Financial Planning

Legends of The Great Succession – An excerpt from my book, The $6 Million Dentist


Mark McNulty


February 23, 2017

February 23, 2017

I mentioned at the start of this book that some of the greatest financial minds I know are those of dentists. I have had the benefit of learning from a financially savvy group of dentists during the past 20 years. These experiences have had a great impact on my life, my business, and the families I work with at McNulty Group.

In writing this book, I took the opportunity to ask four of these individuals a series of questions. With so many dentists not able to reach their financial goals, I wanted you to hear firsthand how this group has been able to achieve such a high level of financial success.

Please note: confidentiality is vitally important in my business, so each contributor will remain anonymous. As well, I felt that some of their more specific experiences had to be removed as they might be too revealing.

Each contributor is a client of our firm.

Dr. OneThe first contributor is a client and also somewhat of a mentor for me. He is a classic “millionaire next door” type, humble and not flashy in the least. Dr. and Mrs. One have $3 million in retirement savings, have personal use real estate (home and cottage) worth $1 million and spend less than $100,000 per year after-tax. They are both in their early sixties. They retired in their late fifties.

1. How did you achieve your financial success?I have always been goal oriented – usually with written goals… I fall into the delayed gratification group. I associated for two years and saved heavily for setting up my own practice. The early years of my own practice were financially tight as most earnings went back into the practice. My practice co-owner and I initially relied on the financial advice of the accountant for the practice where he initially associated. I found out within a year or so that the advice from that accountant was quite poor. I began doing more and more reading on my own about money, investing, financial controls, and practice management. Since then, I always have some financial reading on the go.

I began investing through a friend who had achieved a very impressive net worth at an early age through various types of real estate investing. We did very well for several years, but then over a three year period all the real estate investments failed. I began investing again, but no longer included real estate, and no longer invested as part of a group (too many conflicting goals). I had been continuously setting aside savings every year. I started over through a recommended broker at a well-known brokerage house. Over time, I began to see that my buy-and-hold temperament did not fit with his company’s sell-what-is-on-the-shelf-today approach. I was also learning the costs of high fees the hard way.

My goal, financially, was to have enough saved for a very basic rest-of-my-life retirement by age 50, a workable life by 55, and a comfortable life by 60. We track our finances closely, so we had and have a good idea of retirement spending needs. We met our goals.

2. What advice would you give your colleagues about their practice?Start tracking office and home finances better and earlier – planners do better. Prepare, revise, and monitor an annual office budget to point out office problem areas and opportunities early on.

Dr. TwoDr. Two is close to what I would call a “financial activist”. He has very strong views about our society’s desire for consumption and need to “keep up with the Jones”. This passion has done well for him and his wife on two fronts. They are very well off financially, with a retirement portfolio in excess of $8 million and are only in their mid-fifties. When they retire (shortly), they will be able to live off the income the portfolio generates – and live a life most people would envy.

1. How did you achieve your financial success?Working a lot and living conservatively seems obvious, but it’s a big part. Saving using conservative investments, and not losing the savings. I used GICs to save up enough to allow me to utilize investment firms that have low management fees. It was difficult and time consuming to save the first million, but after that the savings came more quickly and seemed easier.

2. What advice would you give other dentists who want to reach your level of financial success?In order to save much of what you make, you may have to look like you don’t have a lot saved. Be comfortable with yourself and avoid the pressures to look well off or compete. Stay away from complex “saving” or tax plans. Much of my savings were in GICs for over a decade, much to my banks and financial planners chagrin. Nobody can lose you money faster than a financial planner. I was lucky I found this out early and with modest sums of money. You may have to look for a good financial planner, the not so good ones will find you.

3. What advice would you give your colleagues about their practice?Very simple advice: Keep the office conservative. Watch overhead. Be friendly, nice, honest and keep the patients’ best interests at heart. Also, to grow a practice you have to be there. PA

My interviews with Dr. Three and Dr. Four, who have combined retirement savings of $12.5 million, will be included in the next issue of the Professional Advisory. Stay tuned. 

Mark is President of McNulty Group, a firm responsible for $300 million of Ontario dentists’ retirement savings. McNulty Group helps professional families transition from a life of successful practice to a stress-free retirement by using a holistic approach of practice and personal retirement planning. In addition to multiple television and radio appearances, Mark is the author of The Transition Coach 2.0–A Canadian Dentist’s Guide to a Perfect Retirement and The $6 Million Dentist: Successful Succession in 7 Modules.