We all want to retire sooner than later. Many of the decisions we make today will impact tomorrows retirement plans. As optometrists we are provided a profession that rewards us nicely. To best prepare for life after practice, you must consider your financial position post practice ownership. Here are 3 reasons to “take the money and run.”
- Risk tolerance – With the transition of your practice you will lose the day-to-day control of operations. This can directly impact the performance of the office
and ability of the buyer to make their monthly payments. Are you willing to take the risk on the buyer regarding their ability to manage an optometry business? Many consider this a risk they are unwilling to take. You can protect the downside of your risk if you do not finance the complete purchase and a commercial lender is involved. - Remaining Connected – If you offer seller financing, this communicates to the buyer that you believe in the future of the practice. As a buyer, I am more attracted to having a seller willing to finance because the seller remains as a consultant to the practice. If you do not want to remain connected then do not finance the sale of the practice.
- Cost of missing other opportunities – Since you will be financing the sale of the practice, you will not receive all the money upfront. This will limit the amount of capital that you have available for other investment opportunities. Maybe you want to purchase commercial real estate as a part of your investment portfolio or pay off the balance of your home mortgage. Visit with your financial advisor to determine where your greatest return on investment would be before deciding to finance the sale of your practice.
You do want to retire sooner than later. Those optometrists that have a CPA and financial advisor are not the ones worried about deciding to finance or not finance the sale of their practice. They know that a CPA and financial advisor who understand the tax implications and business of buying and selling optometry practices, are going to make all the difference in limiting your risk, freeing you from the practice, and putting your money into the right place for future growth.
