Welcome to the November edition of The Paper Point!

I hope your residency or new practice life is treating you well. We enjoyed seeing so many of you at APICES and want to thank each of you for coming. A huge thank you to the residents and faculty at University of Pennsylvania for hosting, as well as to the AAE staff for all they did to make the weekend so terrific. It was a fantastic meeting and our largest turnout of attendees to date! Thanks to all of you.

We are excited about The Paper Point's direction for the next several issues. We know all too well the financial stresses and strains that you face today – from a down economy to a more competitive practice market, to massive student loan debt and a tighter lending market. We know you love endodontics, but you want to be rewarded financially for your work. You want to be able to have the practice you've dreamed of, pay back your debt and retire young enough to enjoy it!

So, the Resident and New Practitioner Committee is devoting the next several issues of The Paper Point to this topic of finances, both personal and professional. Throughout this issue, our committee members have pooled together perspectives to the topic "Financial things I wished I had known, but no one told me." Read and take heed! From those of us in the trenches, we wish you the best as you learn from our mistakes. Happy Fall!

Best Regards,

Kerri L. Lawlor, D.D.S.
Chair, Resident and New Practitioner Committee

The Abundant Leader
Submitted by Joel C. Small, D.D.S.

Joel C. Small, D.D.S.

"People with a scarcity mentality tend to see everything in terms of win-lose. There is only so much; and if someone else has it, that means there will be less for me. The more principle-centered we become, the more we develop an abundance mentality, the more we are genuinely happy for the successes, well-being, achievements, recognition and good fortune of other people. We believe their success adds to...rather than detracts from...our lives." - Stephen R. Covey

The details of budgets and balance sheets are important to running a productive business, but the practical aspects of management should never distract you from the big picture. Although there are times when you'll need to restrict expenses, you should never limit your vision for success.

I love the idea of abundance. I don't see abundance as a philosophy; I see it as a lifestyle. People who lead an abundant lifestyle view their universe as infinite. They demand win-win scenarios in their personal and professional lives. In their world it is not just acceptable for everyone to succeed... it is an imperative. Compare this to a lifestyle of scarcity, or what some call a zero sum philosophy, in which the universe is viewed as finite. This particular outlook requires that for every winner there must be a loser.

A scarcity or zero sum philosophy is not compatible with effective leadership, because effective leaders are those who are committed to assuring that everyone they lead is given the opportunity and resources to succeed. To an effective leader, realizing one's dreams is a universal goal.

Taken a step further, leaders who embrace a scarcity philosophy believe that their role is to judge others by their weaknesses rather than their strengths. This is a lose/lose scenario, because dwelling on weaknesses seldom creates a positive result for anyone.

Abundance-based leaders are the antithesis of scarcity-based leaders. They understand that each of us has weaknesses, but they choose to judge others by their strengths. Their dental practices are always more successful because they know how to identify talent and position their people so that they are able to successfully develop and utilize their abilities. The result is a culture that benefits the practice while providing the employees with a sense of accomplishment and empowerment. Also, it is my observation that in the abundant culture weaknesses are likely to spontaneously disappear I believe that this is the result of a working environment that is accepting of failure and deemphasizes weakness as a means of developing strength.

An abundance leader, who focuses on what people do well creates a very different kind of culture than does a scarcity leader who continually tries to correct problems. The scarcity-based culture is an overall negative environment. The staff is always afraid to make their own decisions or try new ideas, because failure in itself will be viewed as a weakness. In an abundant culture, the staff is comfortable making creative suggestions and trying out new concepts because they know that failure will be viewed as a necessary part of the growth and development.

The contrast between the two lifestyles becomes most obvious when applied to a business model or, in our case, a dental practice. Imagine a practice culture in which the doctor/leader attributes achievements to their staff and is the first to accept the blame for failures. What would it be like to work in an organization in which the leader was fully committed and engaged in assuring that everyone reached their full potential and realized their individual dreams? This is an organization that will prosper.

Now compare this to a practice culture based on scarcity, in which recognition is coveted by the doctor and seldom shared with the staff. Compare it to a culture in which the leader has an emotional need for control. This scenario—quite different from the abundant culture—will lack spontaneity, creativity, and member development. This is an organization that is in trouble. It will likely crumble because the burdens created by the leader's scarcity mentality cannot be supported by the weakened cultural infrastructure.

Abundant cultures are participative as well as being creative and adaptive. They tap into the vital stream of human potential which is a prerequisite for a highly productive and culturally mature organization. They promote self-development and self-direction. Such organizations are the icons of their industries.

Herb Kelleher, the untraditional CEO of Southwest Airlines, said this about his organization's culture: "A financial analyst once asked me if I was afraid of losing control of our organization. I told him I've never had control and I never wanted it. If you create an environment where the people truly participate, you don't need control. They know what needs to be done, and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchs and control mechanisms you need."

Is it any wonder that numerous studies have proven that organizations that create cultures based in abundance are significantly more profitable than those organizations whose culture is scarcity-based?

Financial Responsibility

What are the most important things residents should know about navigating finances after school is over? Committee members offer some of their best insight to help residents remain financially stable.

A Budget Will Help
Steven L. Richardson, D.D.S.

BudgetStudent loans for graduate students don't seem to go as far as student loans for pre-doctoral students. This is especially true if you have worked prior to residency, as your lifestyle and obligations (house, kids, etc.) are much greater than as a dental student transitioning directly into endodontic residency. Use a budget and keep track of your expenses so you can make the most of your dollar.

Have you considered riding a bike to save $4/gallon on gas and $10/day parking? Remember to live within your means right now so you can enjoy your life in the future. Endodontics is still great despite all the struggles of being a resident.

Plan a Realistic Lifestyle
Justin McAbee, D.M.D.

"Live like a doctor when you're a student, then you'll end up living like a student when you're a doctor."

I don't think students realize that higher loan amounts accrued during school make life much more difficult when you have to pay the bills while in practice. I think this also applies to the first couple of years after graduating from a residency program. If you try to continue to live frugally for the first year or two, you are much more capable of figuring out what you can really afford. If instead you buy the big house and car right out of the gate, and bank on having a large income, you may not really be able to afford it.

Deal with Reality, Not Hope
Kerri L. Lawlor, D.D.S.

FancyCarFor the first full year you work, live as though you are still a student. Continue renting or stay in your modest home, drive your same car, eat on the same budget – keep the fancy meals at big restaurants to a minimum. Have ramen more often than steak. Keep your travel to a minimum.

I know it's hard and you want to live it up – but don't. Here's why: you're going to make less than you think when you factor in taxes, insurance (disability, life and health), professional association dues and commitments, travel to meetings and to see family, the dreaded student loan payment, etc. Trust me. You'll do well, but it's so easy to overextend yourself before you even realize you are doing it. If you wait a year to spend, you'll have a better idea of what you actually bring home every month and what your expenses are. Then, you'll be dealing with reality instead of hope.

Here are examples of two budgets which may help you understand the benefits of living modestly early in your career. The samples were created to show how living "in the black" is feasible and beneficial. Look closely at the detail of these mock-ups to see how you could make some internal adjustments.

If I would have just done that, I wouldn't have had to spend the second year of my practice life dialing in my budget, reigning in expenses, cutting back and feeling miserable because I was supposed to be making some serious dough by now. It's much harder to give stuff up once you've become accustomed, so hold off for just one year.

You can't have it all. You need to set your sights on five to 10 things you want for yourself in the future and focus on those. Revisit your list several times a year, adjust it as necessary and make sure it always meets the goals you and your family have discussed. Realistically, you won't make enough money to have everything, but you will make enough to have everything you want if you narrow your focus. What I'm getting at is that you can't have a monstrous dream home, a mountain home, a beach home, a boat, several cars, money for trips several times a year, a golf club membership and still manage to pay off your debt as fast as possible and save like crazy for retirement.

We make good money, but we don't make enough to live like that, and neither did our endodontic ancestors. They were a bit more thrifty, had less debt to begin with and didn't run around "keeping up with the Joneses" quite like our generation does. Choose right away what you want to spend your money on. It keeps you from getting the envy bug and doing something irrational when your neighbor pulls up in his brand new sports car. Remember? You decided you'd rather spend your money on a larger home or vacations than a car. There's nothing wrong with the car, if that's on your list. But if it's not a goal, it's not getting your money. Be selective about where you put your money and you will quickly feel like you are making millions because it's getting you where you want to be!

Consult with the Experts
Cameron M. Howard, D.M.D.

There is a big difference between the "usual customary rate" for a root canal treatment and the "billed" amount for a root canal treatment. The variance between the two amounts is often quite staggering. Insurance companies can contract numerous patients under their collective umbrella. The more insurers the company is able to claim, the more power they have to negotiate rates with endodontists. If you are considering joining an insurance plan, you need to assess the value of how many potential new patients the plan might generate versus the compensation the plan offers you for each root canal treatment. It's often a delicate balance. An insurance company might boast hundreds of millions of possible patients, but if they only compensate you $450 for a molar root canal, joining the plan may not be a wise decision.

Packages that offer high compensation and have many potential patients are few and far between. Residents often come out of school believing that every root canal will generate $1,000 or more. The reality is that, depending on the type of practice you set up, this pay structure is rare.

My advice – get a financial planner. Mine has been wonderful for my personal financial circumstances. A planner not only helps you square up life/disability/malpractice insurance, but they also think of things you may not have considered (insurance umbrellas, emergency funds, living wills, etc). My agent has not only helped me immensely, but he has served as a wonderful sounding board on all endodontic topics. Find a planner who already works with numerous endodontists in the area and will have a beat on the happenings concerning business trends, things that work or don't work, etc. The small investment in setting up a financial plan was well worth the decrease in stress and questions about what to do with my new paycheck (other than paying back loans, of course)!

It May Get Worse Before It Gets Better
Bruce C. Justman, D.D.S.

FinancesI graduated and entered practice in different economic times, but there are some similarities. I was busy from the first week, and production looked very good. It took four to six weeks to see the income as insurance checks started coming in, but that money was already spent. It is amazing that electric bills and rent are due even though you haven't gotten paid yet. And employees don't understand waiting six weeks for the paycheck they've earned.

Even when you've planned for the lag in insurance reimbursement and patients paying on installments, you need to remember good old Uncle Sam – and his cousin, state unemployment. Why do they need to have monthly deposits for withholding and unemployment taxes? Can't they wait until you have some reserves built up? Nope, those start coming due as soon as you start working. Well, it is a good thing you have that line of credit and can use that for the first few months. Gradually, expenses will start to level out and you can plan the monthly deposits and struggle through the maze of redundant paperwork. Now some of that income will actually be yours... sort of.

Uncle Sam has this thing called income tax and most of the states have some variation of that. That is alright because by now you have been working eight or nine months, and January, February and March have been good production/income months. So come April you will have income taxes due for the previous year. Got that covered because you have always had some sort of income tax filing. But guess what? You're also going to have to make your first quarter deposit for the new year – and now your income level has increased so it's going to be a sizable chunk of money. Oh, and one more thing – you need to make a deposit into to your individual retirement account? That's right, that retirement deposit is due April 15 so that you can take the credit on the previous year's taxes. Tax day used to just be depressing. Now it's become scary. Without very careful planning, you may come to April 15 without enough cash flow to pay all the taxes and deposits. I know more than a few endodontists who have had to take short term loans in order to adequately fund their retirement plans by the cutoff date.

I was in practice two-and-a-half years until I actually felt as though I was making a decent income and could afford to buy the luxuries I had heard about. By my third year in practice, I could go to Best Buy and see a TV I liked and buy it without hesitation, and that felt good. Now, I am pretty conservative because I don't like outstanding credit card bills. My card is always paid, but sometimes that means giving up some of my wants, or at least delaying them.

My advice is to always be looking far enough ahead to see what might loom around the corner. You won't always be able to avoid uncomfortable situations, but you will be able to manage them successfully.

Learn to Be a Business Person
Kimberly A. Lindquist, D.D.S., M.S.D,

PiggyBankI wish someone would have explained to me how the business aspect of an endodontic office works – just the simple things like production, collections and overhead. This is so important when looking at the "big picture" of paying off student loan debt and paying off the practice debt.

The idea that "I am going to be a specialist, so I will have money to make these payments" is a misconception. I am not a good "numbers" person, so I need to see an amortization schedule and some different scenarios.

This information is not only helpful for your business but for your personal life as well. It seems to me that Americans have become dependent on debt and living outside of our abilities to repay this debt.

Invest in Disability Insurance
Mike Reynolds, D.D.S.

The one piece of advice I would give to any new practitioner would be to invest in disability insurance when you are young and healthy. It is easy to get insurance when you are in good health, but if something happens before you are able to get a policy in place, it can be a nightmare trying to get coverage.

Once you begin looking for disability insurance, go with a reputable company. It is beneficial to look at a company's ratings by independent services. After deciding on a company, read the policy carefully and make sure that you find a policy which specifies coverage for "own occupation" rather than "any occupation." As an endodontist, you have spent a lot of time and money to become a specialist, and you need a policy that will cover you in the event you are injured and unable to work. Bottom line is you need disability insurance and the time to get it is now.


APICES 2011 - University of Pennsylvania

Residents from across the country descended on the historic University of Pennsylvania campus in Philadelphia. Scroll down to take a look back at the two-day event.

AAE President Dr. William T. Johnson welcomes residents to the University of Pennsylvania for the eighth annual APICES, with words of advice and guidance.
Dr. Kerri Lawlor, chair of the Resident and New Practitioner Committee, thanks residents for joining AAE staff and leadership at the Welcome Reception. She shared many of the committee's newest initiatives and projects to benefit AAE resident members.
Residents from across the nation gathered to hear some of Philadelphia's finest endodontists, as well as other guests speakers, present a scientific program over a day and a half.


Dr. Frederic Barnett presents a session on "Etiology and Pathogenesis of Apical Periodontitis" during Saturday's portion of educational sessions.
In between sessions, residents visit with corporate sponsors and learn about endodontic products.
Without valued corporate sponsors, residents would not be able to enjoy APICES free of charge. Attendees spend time talking with sponsors between sessions.
APICES 2011 took place in the University of Pennsylvania's state of the art Wharton School of Business's Huntsman Hall.
Residents board the Spirit of Philadelphia for a cruise along the Delaware River with dinner, drinks and dancing for the Saturday Night Social Event.
AAE Foundation President Dr. A. Eddy Skidmore and a resident attendee are the first two on the dance floor with a show-stopping performance.

BUCome On Back to Boston for APICES 2012 at Boston University

APICES 2012 will return to its roots at Boston University from August 3-5, 2012. BU was the original site of the first Advanced Program in Clinical Endodontics Symposium in 2004. The resident planning committee at the University is currently putting together another impressive scientific program with great events. Use this opportunity to gain knowledge of clinical endodontics and meet your colleagues from around the nation.

Please plan now to attend the symposium next summer. In order to offset the current economic condition and constraints, there will be a $150 travel stipend available for all those that attend. Watch for more details to come in the February 2012 issue of The Paper Point.

Volunteer for an AAE Committee

The AAE Educational Affairs Committee encourages residents to consider volunteering to serve on an AAE committee. By serving on a committee, you will become involved with the specialty and help positively move our Association forward.

There is typically one resident who serves on each standing committee for one member year. Consideration has now begun for committee appointments beginning in the 2012 member year. Your program director can nominate you or you can nominate yourself. If you are interested in serving on a committee please visit the AAE website to learn more about the opportunities available, complete a recommendation form and return it to Kara Brockman at kbrockman@aae.org, by November 25, 2011.

Do You Have News to Share?

The Resident and New Practitioner Committee is looking for fun news about your program to include in the next issue of The Paper Point, the quarterly e-newsletter sent to all residents and new practitioners.

  • Have any exciting happenings in your program?
  • What were your residents up to this summer and fall?
  • What types of groundbreaking research are happening at your institution?
  • Any famous alumni?

Please direct all questions or send any news items to Alyson Hall, AAE development coordinator, at ahall@aae.org, or by calling 800/872-3636 (U.S., Canada, Mexico) or 312/266-7255 ext. 3008.

© 2011 American Association of Endodontists. All Rights Reserved.
American Association of Endodontists
211 E. Chicago Ave., Suite 1100
Chicago, IL 60611-2691
Phone: 800/872-3636 (U.S., Canada, Mexico) or 312/266-7255
Fax: 866/451-9020 (U.S., Canada, Mexico) or 312/266-9867