Dentistry to Real Estate Investing? Am I crazy?

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Dentistry to Real Estate Investing? Am I crazy?

Jeff Pearson
Las Vegas, NV · Member since 2018 · 2 posts · 2 votes

Hey everybody!  First time posting after spending a couple years browsing the comments section.  I have worked as a dentist for the last 8 years.  Dentistry pays great but it can be a real grind and you don't get paid unless your butt is in the seat.  I trade my time for dollars.  For the last few years I've really been interested in real estate investing and passive income.  I've listened to the podcasts, read the books, etc but either didn't have the time because I was so busy running my dental practice or didn't have the testicular fortitude/confidence to really get started.  COVID-19 provided me with some extra free time.  

I decided to study for the real estate licensing exam in hopes of getting me off the sidelines and to gain some valuable knowledge, experience and confidence in the process.  My hope is to work part time as an agent to get my feet wet and gain said knowledge, experience and confidence.  Am I crazy to approach my journey into investing in this way?  Any advice?  Has anybody else left a job with golden handcuffs to pursue investing?  

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Account Closed
Investor · Singapore · Member since 2013 · 1k+ posts · 3k+ votes
6y

I think the vast majority of the highly paid professionals should stick to what they are trained to do. There is a huge barrier to entry to become a dentist. There is zero barrier to entry to becoming a real estate agent. You will be throwing away years of schooling, hundreds of thousands of dollars worth of education and earning potential worth millions in the next few years. Do you really think buying rentals with $100/door cash flow is a reasonable plan? Or flipping houses? If I was you (and I kind of was except different high income career) be a dentist, earn big bucks, invest and if you hate dentistry then retire in a few years on passive income. Now if you have your career so much that you want to kill yourself every day, then disregard the above. Nothing is worth being that miserable for. But you chose to be a dentist for a reason right?

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  • Ryan Hill
    Denver · Member since 2019 · 44 posts · 17 votes
    6y

    @Jeff Pearson you aren't crazy - you're smart for thinking this way! Curious what the moment was where you decided you were done trading time for dollars? Are you missing out on something by being in the dental chair?

    I didn't do the realtor path personally although the folks who have done it that I've talked with at length tend to say there is no real correlation to getting your real estate license and investment success. If being an agent is a true passion for you, great. Do it. But it likely won't be the reason you kill it on the investment side. There's a chance it may take valuable time away from your investing and limit your growth. Just a thought. Which means you'll be doing good work on the realtor side, but again, that's trading time for dollars in the end. 

    Do you know where you'll be investing? How you'll be finding off market deals? Some of the more important questions you should work on getting answered in the beginning. 

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  • Jeff Pearson
    OP
    Las Vegas, NV · Member since 2018 · 2 posts · 2 votes
    6y

    @Ryan Hill That moment happened while I was sitting on the beach in Hawaii and calculating how much money the vacation was costing me.  The missed opportunity costs were huge!  I had to still pay my team, rent, utilities, etc.  And that was also my first vacation in 4 years!  My priorities were all sorts of turned around.  I sold my practice right before this pandemic and have relocated to Las Vegas, which is where I would want to invest.  Still working dentistry part time though. 

    I figure that, while it isn't my ultimate goal career wise, becoming a real estate agent could allow me to gain real world experience.  I'm not risk averse by any means but this industry feels very intimidating.  So many rules and regulations.  So many moving parts.  So much to know. I am hoping for some sort of advantage and competency in a competitive environment.  Does anyone else feel similar? I mean, I was in dental school for 4 years before they turned me loose on the general public ;-)  My thinking is that getting experience showing homes, learning the sales process and all the associated components, learning how to identify value, etc would be extremely valuable in the face of stiff competition.  Suggestions on a different approach?

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  • Terrell Garren
    Rental Property Investor · Concord, NC · Member since 2016 · 1k+ posts · 3k+ votes
    6y

    I started RE investing as a hobby 12 years ago.  It allowed me to retire early 3 years ago.  You make good money but you have to work long and hard to accumulate wealth.  Ref Kiyosaki's cash flow quadrant. I was once like you.  Now, I work when I want and my money work's when I'm not (which is often).  I would never spend time on a RE license. My opinion - buying and selling for someone else does not teach investing.  Learn what a good investment deal looks like, how to find them, how to estimate and make repairs, self manage, develop administrative systems, and build a network of trusted professionals - everything from an attorney to a tree guy. Once you have these things in place, it's just too easy. Life is good. Clocks and calendars are for kids. 

    2Reply
  • Jesse Daconta
    Rental Property Investor · Newport News, VA · Member since 2018 · 264 posts · 130 votes
    6y

    Have you thought about earning money as a dentist and investing in apartment syndications? This way you can keep making great money until the syndications can replace your income entirely without worrying about tenants, toilets and managing property managers. Let's connect if this doesn't make sense.

    Best,

    0Reply
  • Michael Thach
    Member since 2019 · 144 posts · 93 votes
    6y
    Originally posted by @Jeff Pearson:

    @Ryan Hill That moment happened while I was sitting on the beach in Hawaii and calculating how much money the vacation was costing me.  The missed opportunity costs were huge!  I had to still pay my team, rent, utilities, etc.  And that was also my first vacation in 4 years!  My priorities were all sorts of turned around.  I sold my practice right before this pandemic and have relocated to Las Vegas, which is where I would want to invest.  Still working dentistry part time though. 

    I figure that, while it isn't my ultimate goal career wise, becoming a real estate agent could allow me to gain real world experience.  I'm not risk averse by any means but this industry feels very intimidating.  So many rules and regulations.  So many moving parts.  So much to know. I am hoping for some sort of advantage and competency in a competitive environment.  Does anyone else feel similar? I mean, I was in dental school for 4 years before they turned me loose on the general public ;-)  My thinking is that getting experience showing homes, learning the sales process and all the associated components, learning how to identify value, etc would be extremely valuable in the face of stiff competition.  Suggestions on a different approach?

    Hi Jeff, 

    I am from Vegas too and completely understand you. I own a restaurant or should I say the restaurant owns me ? :-D 

    I currently own 2 houses in LV and got 5 properties in Texas. 

    Let me be clear on 1 thing. As a realtor you might still not know what a real estate investor knows and vice versa. I meet many realtor who don't understand the math behind real estate and the math is what you will rely on. Just because a house looks good to a realtor does not mean that it will be a good investment. So I don't think being a realtor will help you. 

    I think the easiest way to get started is understanding the math and those moving parts behind a real estate. Build a Excel Spreedsheet and start analyzing properties, you will see that things like property tax, downpay size, ammortization period, interest rate, HOA and all those moving parts can effect a property. After that you will build a simulator and and project into the future your investment strategy and optimize your plans with new ideas. You will run into question like is BRRRR right, or just 15% downpay on each property and sell them after 5 years of appreciation and repeat ... ect ect...

    I think in Real Estate there is a lot of self study and a lot of experience. 

    Also check on your current situation, maybe there is a very low risk to get involve in real estate. Maybe you own your home clean and clear, than you can think about cash out refinance it, use the cash buy another property, rent out your current one and maybe you will have a positive cashflow even after he is paying your mortgage. You have the benefit to live in a new house for free. This would be an investment too. Many creative ways for every life situation this is what makes real estate investing so interesting. 

    What I think help you more than being a realtor is being a Loan Mortgage Officer. There you learn more about the products to finance real estate, know how your paperwork need to look like to qualify for those products and you get a idea of the market trends. 

    1Reply
  • Irving Casas
    Member since 2020 · 66 posts · 43 votes
    6y

    @Jeff Pearson I'm trained as a respiratory therapist for my first career. Working 50 hours week and 2 positions I was able to make over 100K however I'm also grew tired of having to trade my time for money. I got my real estate license in Oregon September 2016. Real estate agents also trade their time, showing proprieties, learning contracts, marketing and advertising their services. Since you make a high income and I presume you can borrow more money, than perhaps hiring a team of processionals is a better use of your time. BP suggest a investment oriented realtor, property manager, lender, title rep(escrow) and contractor. Learn to use the skills others have perfected to meet you goals. Best of luck in you REI journey.

    1Reply
  • Account Closed
    Investor · Singapore · Member since 2013 · 1k+ posts · 3k+ votes
    6y

    I think the vast majority of the highly paid professionals should stick to what they are trained to do. There is a huge barrier to entry to become a dentist. There is zero barrier to entry to becoming a real estate agent. You will be throwing away years of schooling, hundreds of thousands of dollars worth of education and earning potential worth millions in the next few years. Do you really think buying rentals with $100/door cash flow is a reasonable plan? Or flipping houses? If I was you (and I kind of was except different high income career) be a dentist, earn big bucks, invest and if you hate dentistry then retire in a few years on passive income. Now if you have your career so much that you want to kill yourself every day, then disregard the above. Nothing is worth being that miserable for. But you chose to be a dentist for a reason right?

    7Reply
  • Kiera Underwood
    Real Estate Agent · Oklahoma City, OK · Member since 2019 · 956 posts · 600 votes
    6y

    @Jeff Pearson getting your license wouldn't have been my go to suggestion, but I'm curious to see how it plays out for you. I know dentists that didn't stop dentistry to invest, but that do both. No question that's what I would try do. 

    0Reply
  • Whitney HuttenPro Member
    Investor · Boulder, CO · Member since 2016 · 1k+ posts · 1k+ votes
    6y

    @Jeff Pearson I agree... there is a high and best use of your time.  Have you done the opportunity cost calculations of staying in your job, hustling to build a portfolio on the side, and redirecting your income until you reach your FI numbers?  Also, you could think about investing passively in syndication deals and building wealth that way, and staying in your current job.  

    Also, do you have your own practice or are you on staff?  If you are on staff, what would it take for you to open your own practice, and hire staff?  My dentist is in the office 2 hours day it seems... he team takes care of everything else. You have a very unique talent... I'm just trying to think of ways you could leverage that to invest and meet your goals. Either way... you are on an amazing journey.

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  • Account Closed
    Member since 2019 · 1k+ posts · 1k+ votes
    6y

    @Jeff Pearson

    So you’re currently trading time for money and have recognized the difference between owning a job and owning a business,.. and now you want to own another job? ... why? Are you hoping to leave your current profession to be a professional realtor? Or professional landlord? OR,... own real estate that provides as passive of income as possible?

    You’re in an excellent position to leverage your wealth and someone else’s time to free up your time. 10 years from now there is no reason you couldn’t be financially independent & free from the requirement to trade time for $. And that’s if you’re an associate making 45% of your billable. If you’re a partner, that timeframe compresses significantly.

    Unless the goal is to continue to trade time for dollars I feel your additional efforts are better placed elsewhere.

    0Reply
  • Ian IppolitoBusiness Member
    Investor · Tampa, FL · Member since 2015 · 1k+ posts · 1k+ votes
    6y
    Originally posted by @Jeff Pearson:

    @Ryan Hill That moment happened while I was sitting on the beach in Hawaii and calculating how much money the vacation was costing me.  The missed opportunity costs were huge!  I had to still pay my team, rent, utilities, etc.  And that was also my first vacation in 4 years!  My priorities were all sorts of turned around.  I sold my practice right before this pandemic and have relocated to Las Vegas, which is where I would want to invest.  Still working dentistry part time though. 

    I figure that, while it isn't my ultimate goal career wise, becoming a real estate agent could allow me to gain real world experience.  I'm not risk averse by any means but this industry feels very intimidating.  So many rules and regulations.  So many moving parts.  So much to know. I am hoping for some sort of advantage and competency in a competitive environment.  Does anyone else feel similar? I mean, I was in dental school for 4 years before they turned me loose on the general public ;-)  My thinking is that getting experience showing homes, learning the sales process and all the associated components, learning how to identify value, etc would be extremely valuable in the face of stiff competition.  Suggestions on a different approach?

    Jeff, I am retired and live off of my passive income. And I'd say that if you're tired of working in dentistry and completely burned out and simply looking for a new work career then that is one thing. Then perhaps it makes sense to make a switch to being a broker.

    However, in my opinion, you can't justify a switch from being a dentist to being a real estate agent as a means to stop "trading time for money". You're still would be doing the exact same thing.

    And becoming a real estate agent only trains you to continue to be a real estate agent (i.e. facilitating real estate transactions for others). That's completely different than active real estate investing for which completing the transaction is the quickest and easiest part (and which can usually be outsourced to others more economically). You would still have no knowledge of the bulk of the things that are vital to learn.

    For someone who already is an active investor, it can be nice icing on the cake to have a real estate agent license, because you can save money on commissions. But, for someone who isn't an investor already, it's putting the cart before the horse in my opinion.

    Also, being an active real estate investor might work for you and may ultimately put you in a situation of not trading time for money.  But it generally takes a lot of hard work and time to get there (and probably making mistakes and backtracking too). So you may want to keep that in mind.

    It sounds like you already have a decent nest egg after selling your practice. If so, then you could supplement your active investing with passive real estate investing. And right away you would be truly using your money to do the work rather than you. 

    To do that you would need to start looking at lots of deals (go to CrowdStreet for example to start), join an investor club to learn from people with more experience, learn how to do due diligence etc.. In my opinion this would be a much better investment of your time towards getting out of the situation of trading time for money, than a real estate broker's license.

    In my portfolio I have a combination of directly owned real estate and passive. Since both have their advantages and disadvantages, this gives me the best of both worlds. Good luck.

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  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    6y

    @Jeff Pearson  Why not take a break from dentistry and get started investing in real estate, then go back?  Most investors have a regular job which allows them to get a mortgage and buy rentals.  If you don't want the hassle of running the business, why not fill in for other dentists so they can take holidays? or share a practice with someone and work part time? Being a real estate agent is different than investing and most successful agents, put in long hours.

    1Reply
  • Matt Groth
    Contractor · Grand Marais, MN · Member since 2016 · 249 posts · 417 votes
    6y

    Skip the agent thing. Work as a dentist for 40 hours, live on half or less of your income, spend another 20 to 40 hours per week investing in re. Do that for 5 years. If the goal is to not work, imo, you won't achieve nearly what you envision.

    1Reply
  • Stephen KeigheryBusiness Member
    Rental Property Investor · New Orleans, LA · Member since 2018 · 717 posts · 555 votes
    6y

    @Jeff Pearson since dentistry is a hight paying profession it might be smart to make some initial moves while you still have the income. You should be able to have access to bank financing so perhaps use that borrowing power to house back a Duplex or 4 Plex. Repeat this process and as you become comfortable buying house and being a landlord then jump in full time.

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  • Terri Haley
    Real Estate Agent · Las Vegas, NV · Member since 2016 · 32 posts · 31 votes
    6y

    Hi Jeff! I completely understand jumping out of the Golden Handcuffs and into RE investing. I also understand the pathway you've chosen through studying for the RE License. I've practiced nuclear medicine for over 27 years. I have an S Corporation and provide coverage for offices when needed. 15 years ago, I heavily studied RE investing because I wanted out of the medical field (it is brutal). After a lot of studying books, CD's, REIA meetings, etc...I acquired 15 properties across four states and managed them all myself. I also got a mortgage license so that I would know the details about how that worked. Long story longer... I lost all the properties around 2009. The properties were working me, while I was working 60+ hours per week in Nuc Med and property management (my own). I stayed in Nuc Med in order to qualify for the loans. That was the school of hard knocks and I paid hefty Stupid Tax.
    After the initial crash, I bought a foreclosure (irony at its best). Fast forward to today. After several years of picking myself back up, working more Nuc Med, and selling that foreclosure that I rehabbed, I obtained my RE license. Not only to learn and know that process, but to have access to the MLS, Realtor education classes (there are several investor classes offered), and with my background as an investor, to help others obtain investment properties. All that being said, I understand why you'd want to obtain the license. But, being an active Realtor is not easy. Plus, if you need mortgage loans to purchase good investment properties, you'd most likely have better chances of qualifying with your occupation of Dentist. I agree with some others here about let the Realtors deal with all the regulations, paperwork, and transactions. You make sure you know how to run accurate numbers. That being said, I have learned a lot having the RE license. I was investor 1st, Realtor 2nd. I'm also in Vegas.

    1Reply
  • Josh Walker
    Investor · Norman, OK · Member since 2017 · 75 posts · 53 votes
    6y

    @Jeff Pearson - it has been said a couple of times within this thread, but I would definitely consider passively investing in syndications.  I have personally invested in almost 40 separate deals. It has been a great option for me to work toward replacing my W2 income with passive income while still working.  Shoot me a DM if you would like to discuss further. I wish you luck!

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  • Andrew HoganPro Member
    Rental Property Investor · Indianapolis, IN · Member since 2016 · 560 posts · 463 votes
    6y

    Way to recognize where you're at and want to be on the right side of the Rich Dad Cash Flow Quadrant. 
    Now it's time to get that money working harder for you -- keep soaking up info like a sponge and networking with experienced investors/operators.

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  • Steve Morris
    Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
    6y

    "My hope is to work part time as an agent to get my feet wet and gain said knowledge, experience and confidence. Am I crazy to approach my journey into investing in this way? Any advice?"

    First off, if the goal is to gain experience by selling, part-time won't work.  You have a short runway and going half-throttle ain't going to help.  If you think being a dentist is hard, resi RE is 24/7.  Think the main question you need to answer is can you talk to a lot of people and take a lot of NOs?


    "Has anybody else left a job with golden handcuffs to pursue investing?"

    Sure, electrical engineer and had my own rep firm.  Changing economy forced me to do something else.  I knew I know numbers and finance better than 99% of brokers - Very little help.  Calling people cold and building your list is about it.  On investing, all I can say is with each deal I made fewer mistakes.

    1Reply
  • Chris Levarek
    Real Estate Syndicator · Phoenix, AZ · Member since 2018 · 903 posts · 1k+ votes
    6y

    @Jeff Pearson My dentist actually is a realtor and has been for last 6 years. I say do both. As others have mentioned, having multiple streams of income is the true path to wealth creation. I would recommend not trading in one job for another but rather build a wealth portfolio with multiple streams. 

    So have one stream from dentistry practice, 1 from 1-2 houses sold a year as a realtor, 1 from passive investments into other real estate, etc.

    With a lucrative career, you can easily spend that 5-10 years building multiple streams and then choose to pursue one or the other when one stream eclipses the other. On the other note, life is about being happy so not everything is logical or clear cut all the time. 

    Do what makes you happy. 

    0Reply
  • Craig Anderson
    Member since 2020 · 87 posts · 35 votes
    6y

    Please pay attention to what Terri Haley has posted to your thread, as her comment as to your idea to end being a dentist, & go into real estate. She tells of losing all her money, in 2009, as part of the U.S. financial crash in that year, s she was invested in Rentals. And you could end up in the same place, as her, in the next few months, if you go whole hog into real estate. And I think you best keep doing denitry, even if it's part-time, due to it might be your one true way, to get a dependable income. (Terri Haley is involved in Nuclear Medicine, according to what she posted as her comment, & she found that she had to return to it, after 2009, just so she could get a dependable income.) It might be better to sit out the next few months, learning what you can about real estate, & see if what some predict, will take place, a crash in real estate prices, due to the U.S. is already in a Recession in 2020, due to the COVID-19 virus is invading the U.S. And if these prices do crash, then would be a good time to buy into Rentals, at reduced purchased prices.

    1Reply
  • Kevin McGuirePro Member
    CTO of BiggerPockets · Seattle, WA · Member since 2019 · 178 posts · 178 votes
    6y

    @Terri Haley and @Anish Tolia made great points, as did others here. My question is: are you systematically building a future or are you escaping dentistry? As others said, if you're miserable than do something else for sure. But my tendency is to be more methodical around such a big change. My advise in short is to build your REI skills and portfolio while maintaining the safety net of the dentistry.

    My story is around working in high tech, great income but getting burned out. Four years ago I started buying rentals so that I’d “have an out”. I now have 12 doors, left my W2 job in the new year. In time I may go back to it since I do like the discipline just not crazy about the industry and the stress. Or, not: my days now start with coffee in the backyard listening to the birds and watching the dog run around. The point is, I now have a choice, and that in itself is hugely valuable in instilling a sense of control over your life which contributes to lower stress. But I built that while I had the security of the W2 income and ability to qualify for loans.

    As others advised, I wouldn't bother with a real estate license as a path to REI, it's not needed. If you're a continuous learner then by all means, but I think your time is better spent reading and analyzing deals.

    Best of luck! Change is hard and only the brave attempt it!

    1Reply
  • Terri Haley
    Real Estate Agent · Las Vegas, NV · Member since 2016 · 32 posts · 31 votes
    6y

    @Kevin McGuire "my days now start with coffee in the backyard listening to the birds and watching the dog run around."    ---> YES!!!  

    That's what it's about. After good planning, work, diligence, and certain sacrifices. THAT ^^ is the goal. Our lives are not meant to be miserable. Through all of my research and even failures, REI is still (IMHO) the best means to financial freedom. Learn; Do it; Fail, but learn; Do it again.

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