Don’t spend what you don’t have

 

Picture this: A stranger walks up to you and asks you to lend him $50,000.

He has no job and therefore no income. And he is in debt for $150,000 (or more). Even if you had the money, would you lend it to him? Of course not! You’d be crazy to lend anyone $50,000, especially if he or she is unemployed.

The science of new-practice financing

Work. Yes, you read it right – work! Get a part-time job as you go through college in order to borrow a lesser amount in student loans. The higher your student-loan debt, the less likely you will obtain working capital. If you are married, have your spouse work, too. This can reduce the amount of your student loans further.

Avoid. Try to not obligate yourself to any additional debt, other than the purchase of an automobile, while you are in college. Remember, the lower your overall debt, the better your chance of getting a start-up loan.

Time. Some student DCs purchase equipment before graduating. This is a mistake in timing. Don’t fall for sales pitches like “Half of what you pay can be deducted from your income taxes.” Any new practice coach will tell you emphatically that you won’t pay any taxes your first year in practice. Therefore, 50 percent of nothing is … nothing.

Takeaway points