Financial advice for dentists: Crossing the Rubicon and 'financial death'

As a dentist, figuratively "crossing the Rubicon" is not always a bad thing. But think very carefully about what you are about to do.

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As a dentist, figuratively "crossing the Rubicon" is not always a bad thing. But think very carefully about what you are about to do.

The idiom "Crossing the Rubicon" was never part of my lexicon until recently. It refers to when, in the year 49 BC, Julius Caesar crossed the river Rubicon with his troops, an act of treason punishable by death. At that point, he was committed in his attempt to become emperor of Rome. Failure would mean execution.

The phrase has become a metaphor for those who intentionally cross a point of no return. It's also a useful way for me to think about financial decisions or patterns of financial behavior that do the same, and that may result in downfall from a wealth accumulation standpoint. The challenge becomes identifying these decisive moments as such. Here are some characteristics.

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Rubicon purchases promise emperorship potential. Why build a single dental office building when owning a whole multimillion-dollar office complex can pave the way to tenants who pay your mortgage and real estate riches? Why not build a house that indulges your love of Prairie-style architecture along with your purchase of a building lot that costs as much as your original budget for a home? Why not invest your life savings in a new tech start-up company that promises to become the next Uber?

One of the characteristics of a Rubicon purchase is the allure of a king-of-the-world outcome. What has been helpful to me is the realization that, whenever I have this "emperor-like" feeling about a large purchase, I also need to carefully assess the potential for my demise-from stress, if nothing else.

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One can cross the Rubicon by following the troops across instead of leading them. It's one thing to intentionally cross the point of no return with the desire (and means) to become emperor. It's quite another to barter away a future of financial freedom because of a desire for your children or spouse to live like little emperors. You work very hard to achieve the level of income you have. You deserve to become financially free of the need to work and to live a fulfilling retirement. It's not OK for family members to live like emperors at the expense of achieving this important goal. Following the troops into a Rubicon decision may mean large home or vacation home purchases, large private school or college tuition, large hobby costs, or dependent costs.

Don't cross the Rubicon unless the goal is worth the risk and hardship. Recently, I have been immersed in reflection about what actions would be necessary to convert my relationship with money into a pursuit or a quest, hopefully with a higher spiritual calling than mere accumulation for its own sake. To me, a quest involves an extraordinary adventure with a clear endpoint and a plan to achieve the purpose of the quest. It risks passing the point of no return to pursue a very worthwhile goal. Saving more for retirement is important, but doesn't feel like it rises to the level of a quest, which is defined by a deep sense of calling or mission.

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For most dentists, simply practicing dentistry involves a certain sense of calling or mission. What would it take to elevate a career to a quest? What would be involved in removing what you might hate about the business or financial component of a career and leaving only the practice of dentistry? A relationship with money as a quest would have to involve a deep sense of legacy that would drive a career to a much higher calling. If you were free of the need to work for a living, how would your life change? Is any large purchase more important than the ultimate freedom from your need to work?

Don't cross the Rubicon without great wisdom and deep planning. Since crossing the point of no return with large purchases risks financial downfall, it is incumbent that wisdom and deep planning are involved. So many dentists I have known over the years have crossed the Rubicon as it relates to financial freedom, and they are now risking financial "death" due to inadequate planning, reflection, and wisdom. The classic principles of diversification, financial education, and the habit of operating from realistic financial goals are too often ignored.

All of us will confront at least one Rubicon choice during our careers. Perhaps the most important issue is identifying these decisions as such, and then thoughtfully and thoroughly assessing the consequences.


Brian Hufford, CPA, CFP, is a wealth advisor and dental practice thought leader with Buckingham Advisors, a national, independent wealth and financial advisory firm with a specialty in helping dentists achieve their most important goals. To connect with Brian and Buckingham, visit BuckinghamAdvisor.com, call (866) 545-8816, or e-mail huffordinfo@bamadvisor.com.

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