Your business or practice asset is a key asset in your life and in your career for creating active income.
Your active income is the engine that drives everything else.
It provides for your family’s lifestyle, your investment capital, your retirement capital, your special needs, and more.
In the current marketplace, the valuation of practice assets have been at an all-time high.
Why is that? For one, interest rates are at an all-time low.
With low interest rates, the borrower of an asset is able to pay a higher price with a lower cost of debt financing, which is a good thing.
There have been trillions of dollars pumped into the economy by the Federal Reserve.
This money is digitally printed fiat money, and is still circulating.
This causes a lot of money to go directly into Wall Street, which is why they are now looking for bargains.
The medical and dental arena is where Wall Street has put a lot of their money.
The money that was put in the marketplace has pushed the value of our solo practices up, but that is not going to last.
This window of opportunity where our practice values have been at an all-time high will not last forever.
Nothing lasts forever.
If you are in a position to take some equity off the table by selling your practice, or by selling a part of your practice in the form of partnerships, then now is the time to do it.
If you can build a practice and bring in partners, then you will probably get the highest valuation now or in the next year or so.
As interest rates start to go up, and they will, the valuations of any debt financed assets will start to go down.
The banks won’t be lending anymore, since banks lend on cash flow.
If too much cash flow is being sucked up by interest rates, your buyer won’t be able to pay the higher price.
Those values will come down.
As corporate consolidation slows down and big corporations stop acquiring practices, they will start to open up their own.
Currently, insurance companies are combining forces with corporate entities, and they are starting to build their own free-standing clinics.
They are not going to need a solo practitioners’ practice any longer.
If you are in the position to take some equity off the table, then now may be the time to do it.
To your freedom,
David
P.S. Whenever you’re ready, here are some other ways I can help fast track you to your Freedom goal (you’re closer than you think):
1. Grab the first 3 chapters of my latest book:
“From High Income To High Net Worth – For Dentists.” The Ultimate guide for anyone who desires to build sustainable lifetime passive cash flow and net worth through real estate investment without ever meeting a tenant or fixing a toilet. Visit www.freedomfounders.com/free-book-chapters and start reading.
2. Become an Insider:
If you’re committed to Freedom, but still building a practice, paying down school debt, or growing investment capital, Freedom Insider is your entrance ramp onto the fast track! Visit www.freedomfounders.com/insider and click the big orange “Become An Insider” button!
3. Apply To Visit The Mastermind:
If you’d like to join dozens of dentists, docs, and practice professionals on the fast track to Freedom (5-7 years max), visit www.freedomfounders.com/step-1 to apply for a seat.
4. Want to Move to the Front of the Line? Fast Access Insider Group:
If you’d like to work directly with me and a small group of my closest investment colleagues, with direct access to the dealmakers and asset classes that I invest in, just send a message to my Executive Assistant (Lindsey@FreedomFounders.com), and put “Fast Access” in the subject line. Or, call 888-548-5855 and leave a brief voicemail for Lindsey. Let her know you’re interested in the Fast Access Insider Group – we’ll set up a time to talk, find out about your goals, and see if there is a fit.
