A recent article in Oral Health by CDSPI Advisory Panel member Dr. Sanjukta Mohanta highlights the difficult choices some dentists face when considering whether to leave clinical practice. Her reflections underscore the personal and professional challenges of stepping away after years of demanding and costly training. While Dr. Mohanta emphasizes the importance of open conversations, exploring alternative paths within the profession, and approaching the decision with compassion, it is equally important to recognize the financial implications. As with any major life transition, careful planning for both the immediate and long-term financial impact is essential.
We spoke to Matthew Wright, an Investment Planning Advisor at CDSPI Advisory Service Inc. to get his insight on what strategic, realistic steps you could be taking now to prepare for a potential career change and, for those dentists who have decided on “divorce” and need a focused tactical plan to live without clinical earnings while transitioning.
Why finances matter when you leave
Departing from clinical dentistry is not solely an emotional decision; it has significant implications for cash flow, benefits, business valuation, and debt management timelines. Certain consequences are long-term, such as effects on practice value, retirement savings, and tax strategies, while others are immediate, impacting monthly living expenses, insurance needs, and interim income requirements.
Preparation for both short- and long-term financial horizons enables you to consider whether to remain, transition, or exit the field without undue financial stress. According to Matthew Wright, the key areas of focus should include:
Establishing an emergency fund.
Securing adequate income protection.
Evaluating practice value with exit planning in mind.
Maintaining a well-defined short-term budget.
Engaging in regular financial planning can help mitigate the risk of a career change resulting in financial instability.
Long-term financial moves (start these now)
Whether you stay in dentistry or not, these are the strategic steps that can help protect your future throughout your career.
Build a safety net and keep it liquid.
Often called an “emergency fund”, it should hold accessible funds that cover expenses for at least 3–6 months of essential living costs. High-interest savings accounts provide low-risk, easily accessible funds, while Tax-Free Savings Accounts (TFSAs) allow investments to grow and be withdrawn completely tax-free. Speak with an advisor or specialist at your bank to determine whether a personal or professional line of credit for dental professionals could provide a short-term solution if additional liquidity is needed.
Income protection (disability insurance).
If an injury or debilitating condition is leading you to contemplate leaving your practice, your disability insurance may provide a financial lifeline while you recover or pivot to a new career. Reviewing your policy with an Insurance Advisor who understands the complexities of a career in dentistry can help ensure coverage is tailored to a dentist’s unique needs (such as whether it includes important provisions like own occupation coverage).
Understand practice value and exit options.
If you own or part-own a practice, its sale value can be a major part of your retirement or career-change resources. Valuation methods vary so consult a practice valuation specialist early. Realistically, preparing a practice for sale is often a multi-year effort that should not be rushed.
Address debt strategically.
If you carry student or business debt you will need to determine whether to pay down debt before a career change can improve your options, or if preserving cash is more important. It is strongly recommended that you review these scenarios with your financial advisors before making changes to your repayment arrangements.
Diversify income inside and outside dentistry.
Consider ways to add non-clinical income (teaching, consulting, entrepreneurism, real estate investing, etc.). These streams can help ease a jump out of clinical hours and preserve skills and networks.
Tax and retirement planning.
Working with financial advisors who are experienced with dental practices can help accelerate your planning. They can help you to separate corporate vs. personal structures, realize potential capital dividend opportunities, and implement efficient retirement account strategies. The tax implications of selling a practice or moving to salaried work can be material so planning is crucial.
Succession and legal documents.
If you have practice partners, review buy-sell agreements and succession clauses. Update wills, powers of attorney, and beneficiary designations so a career change doesn’t create surprises.
A few proven, practical tips
When it comes to leaving dentistry, abrupt exits are rarely the most successful. Matthew Wright explained it this way: “The most resilient dentists I’ve worked with didn’t quit cold turkey. They gradually reduced clinical days while building other income streams. That way, they kept cash flowing and preserved their options”.
Financial safety nets matter, too. Practice value is often tied up in leases, equipment financing, or staff costs. That’s why it’s wise to keep some personal funds separate from practice accounts. “If you own your practice, start thinking like a future buyer even if you don’t plan to sell soon,” Matthew Wright recommends. “Organized patient lists, clean accounting records, written protocols, and well-defined staff roles all boost practice value and make a sale smoother.”
Numbers only tell part of the story. Deciding whether to step away from dentistry isn’t just a financial calculation. It’s an emotional journey that can bring up doubt, guilt, or even relief. It helps to remember you don’t have to go through it alone. Reaching out for support can make the difference between feeling isolated and feeling understood.
Where to get help
Talk to peers and mentors.
As Dr. Mohanta reminds us, sharing your experience with colleagues who've faced similar crossroads can be reassuring and may reveal paths you hadn't considered. Study clubs and mentorship programs can offer support and help put things in perspective.
Members assistance program.
If the emotional toll feels heavy, confidential counseling is available 24/7 – at no cost to you – from TELUS Health.
Specialized professional advice.
Financial and legal professionals who understand dentistry can guide you through the practical side of a transition, whether that’s valuing your practice, adjusting debt strategies, or planning your next steps.
Final thoughts
Dr. Mohanta’s message is a compassionate reminder that leaving the profession – or changing the way you practice – is a difficult but valid choice. Ensuring you have the financial wherewithal to feel secure with that choice expands your possibilities. By protecting your income, setting aside a personal buffer, understanding your practice’s value, and leaning on specialist advice, you can step into whatever comes next with confidence and optimism about the future.
The information contained in this article is of a general nature only and should not be considered as personal investment or financial advice. For specific advice about your situation, please consult with your financial advisor.