The dental hygienist's salary is one of the reasons the profession is so popular. Ranked as No. 2 in healthcare support jobs by U.S. News & World Report, the field is expected to grow 19 percent by 2024. The median full-time salary is $71,520. Even so, we all know life likes to throw some challenges our way, such as a sudden wrist injury or a change in ownership at your dental practice. To accommodate curve balls, you need to be strategic in setting goals to make sure you're planning for whatever comes your way so that you can be able to retire on your own terms when the time is right. Here's what you need to know to get started.
Goal 1: Create a Reasonable Budget
Creating a budget and a long-term plan to help guide you to save for the future really helps keep you on track. The first step to sketching this out is to list your essential monthly expenses and multiply by 12 (to account for the 12 months of the year). The sum will give you an idea of what your annual take-home pay needs to be to secure your basic cost of living.
Next, take stock of where else you're spending and whether it's truly necessary. Luxury items like the cost of entertainment (eating out, going to the movies, etc.) and luxury household items can add up quickly, and are easy areas to cut back. Give yourself reasonable limits per month on these treats to avoid overspending.
You also want to pay particular attention to how much money you are spending on those little extras. Are you going to the coffee shop every day on the way to work? Are you eating out for lunch three days a week? Add up the cost of a $5 coffee daily times 4 days a week and it comes to $80 per month that you could be using differently.
If your budget doesn't leave much room for saving, there are some simple ways to help give you some breathing room. Start by eliminating anything you are paying for that does not serve a purpose. For example, if there are unread magazines collecting dust on your coffee table, cancel your subscription. Downgrade your cable package if you only watch a few basic channels.
Goal 2: Make a Debt Management Plan
Next, you'll want to manage your debt. According to an analysis of several statistics by NerdWallet, in 2015 the average credit card debt per household was $5,883, and the average for households with credit card debt was $15,762. There are a few strategies to manage your credit card debt, so first take stock of your credit cards: take a look at your credit cards' balances and interest rates. If the interest rates are the same, it can make sense to start by paying off the card that has the smallest balance to get it to a zero balance as soon as possible. Then move on to the next card. If you have a higher interest rate on a particular card, it may make more sense to start with that one first. You should also consider any other sources of debt at the same time, to determine which source(s) of debt it is best to pay down first.
Regardless of your strategy, you should try to pay at least the full balance for the current month, not just the minimum monthly balance due, so that you are not building up more debt and can start to pay down what you owe. A good goal to keep in mind is not to make purchases using a credit card unless you can pay for the entire purchase within the next month. Limit the number of credit cards you have, and consider transferring your balances to a credit card with a lower interest rate.
You can make some additional changes to help reduce expenses. If you have a mortgage, think about re-financing to a lower rate and, even better, pay an additional $100 on your mortgage payment. Why? It can help pay off your mortgage sooner and save you in interest charges. Although it will not reduce your current expenses, it will reduce your long-term debt and interest payments. You'll also want to pay all of your bills on time to avoid late charges—this will help keep your credit score healthy, too.
Lastly, ask yourself before each purchase: "Do I really need this?" If the answer is no, simply walk away.
Goal 3: Invest in Your Future
With your budget and any debt under control, you'll have more financial freedom to invest in your future both in the short-term and the long-term. It's always wise to put aside some funds each month in case of emergencies. Cars break down, hours in the office may drop, or an injury keeps you out of the practice for a few weeks (or months) at a time. Creating an emergency fund to help cover your living expenses will prevent you from being blindsided by a sudden curve ball thrown your way.
It's also wise to save for retirement, too, so you can choose to retire when the time is right for you. If your employer provides a 401(k), you should look into participating in it. Not only does this offer tax-deferred retirement savings, it's especially beneficial if your contributions will be matched or partially matched.
You can also contact a financial broker to invest in stocks and other financial assets to help your money work for you. Depending on your circumstances, an individual retirement account (IRA) may be a good option. There are different types of IRAs, as noted by CNN Money. Conduct your own research and be sure to get a professional's advice to see which options work best for you.
Achieving your budget and planning goals gives you the freedom to navigate your career with confidence. Working with your patients is rewarding in itself, but the chairside time can be exhausting and is hard on your body. By striving toward financial freedom, you can gain the ability to make decisions about your career on your own terms.
- Create a plan to determine how much you spend and how much extra money you have.
- Control your daily expenses and eliminate credit card debt.
- Contact a financial agent or broker and conduct your own research to see which investment opportunity is right for you.
Why It's Valuable
Start setting attainable financial goals now to have a secure financial future. It can be really hard to focus on enjoying your work if you live paycheck to paycheck. By taking control of your expenses, you can devote more energy and focus to your work in the office.