According to a recent article in the New York Times, many veterinarians are discouraged about being able to earn enough income to pay off their student loans. The only solution seems to be income-based or pay-as-you-earn loan repayment programs. Is there a real solution? The real solution is to learn what veterinarians never learn in school - the veterinary practice management skills that enable them to build their own profitable practice, says Dr. Joel Parker, DVM, President and co-founder of Veterinary Practice Solutions (VPS), a veterinary management consulting company.
Over the last 12 years, student debt has continued to climb at a rate higher than the growth of starting salaries. The student loan debt load has increased by 223 percent, while the salaries have increased a mere 46 percent, says the American Veterinary Medical Association. The fact that veterinary students are still taking on this level of debt is testament to their strong dedication to their chosen profession. Looking at it from a financial point of view exposes a sobering challenge.
Clearly, the increase in debt is far from commensurate with the increase in salary. And the chances of a new veterinarian being able to pay off their loans in a reasonable time period, if at all, are slimmer than ever. However, if they know how to open, run and build their own profitable practice, the debt is more easily handled, says Dr. Parker.
"Carrying that much debt at the beginning of your career can be very discouraging," he said. "But if the new veterinarian opens their own practice within a couple of years of graduating and gets the training they need to boom that practice, they'll be making the profit they need to pay off debt incurred with the purchase, and satisfy their student loans, in plenty of time to build a practice that gives them a very healthy retirement."
But are veterinary practices that easy to come by?
According to Dr. Parker, this is the perfect time to buy a practice. Many baby boomers are ready to retire and want to sell. And as more and more baby boomers reach retirement age - over the next 15 years - there will be more and more practices available. The financing is also relatively easy to come by, said Dr. Parker, and new veterinarians should definitely take advantage of this market.
"If you don't buy your own practice, and learn how to run it, you'll spend your entire career working for wages," said Dr. Parker. "That just doesn't work when you've incurred so much debt learning your profession."
"But learning how to run the practice and make it profitable is pivotal. There are many veterinarians who run their own practices for the love of animals and medicine but day in and day out suffer severe time and financial stress."
At VPS, Dr. Parker offers a unique training program based on an executive MBA style of learning. "We have a three-pronged approach," he said. "We train you in an executive academy, work with you to develop an exact strategy to build a profitable practice, and schedule you with weekly coaching sessions that help you implement what you've learned and planned - all while you continue to run your practice."
While the training teaches you everything you need to know, the secret is in the implementation. "There's no shortage of great ideas," said Dr. Parker, "but there is a gross shortage of implementation. Our Executive MBA-style program gets over that hurdle. The trick here is to run a successful, profitable practice and live to tell the story."