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Choosing between private practice and a Dental Service Organization (DSO) is one of the most important financial decisions a dentist will make. While both paths offer opportunities, they lead to very different outcomes, especially when it comes to long-term wealth.
Many dentists are drawn to DSOs for stability and simplicity. Others pursue private ownership for control and higher earning potential. But beyond lifestyle preferences, the real question is: Which path actually builds more wealth over time?
Using insights from recent industry data and financial analysis, this blog breaks down the numbers, risks, and long-term impact of each path.
Before comparing income and wealth, it’s important to understand how these two models fundamentally differ.
At a high level, private practice offers ownership and upside, while DSOs offer stability and structure.
Let’s look at average earnings based on industry data:
That’s a difference of $51,000 annually. At first glance, this may not seem life-changing. But when you extend this difference over a full career, the impact becomes significant.
Let’s break this down with a simple example.
A dentist chooses private practice and earns an extra $51,000 per year compared to working in a DSO.
If they:
This means choosing ownership over employment could result in millions of dollars in additional wealth
The previous example uses average numbers. But many successful practice owners exceed these figures significantly.
High-performing practices can generate:
In these cases, the wealth gap grows dramatically.
If a dentist earns an additional $200,000 per year through ownership and invests it:
This highlights the true potential of private practice: There is no fixed ceiling on income
One of the main reasons dentists choose DSOs is the lower perceived risk.
However, in finance, there is a well-known principle:
Higher risk is typically associated with higher returns
This applies directly to dentistry.
Private practice involves more responsibilitybut it also offers:
Choosing a DSO may feel like the safer option, especially early in a career. But this decision comes with an opportunity cost.
While you gain stability, you may be leaving: $2M to $10M+ on the table over your career
Student debt plays a major role in shaping career choices.
Because of this, many dentists:
Many believe: “I can’t afford to own a practice because of my loans.”
But with income-driven repayment programs, debt does not necessarily prevent ownership. Instead, it often creates a fear-based decision mindset.
Another key difference between the two paths is control.
For some dentists, convenience is appealing. But for others, lack of control can become frustrating over time.
One major advantage of private practice is equity.
When you own a practice:
In contrast, most DSO roles:
Even when equity is offered, it often:
Wealth is important, but lifestyle also matters.
The best choice depends on your personal goals, not just financial outcomes.
There is no universal answer, but there are clear patterns.
The choice between private practice and a DSO is not just about income; it’s about your financial future.
Over time, the financial difference can be substantial. Dentists who choose ownership often benefit from:
Understanding these differences allows you to make a decision that aligns with both your career goals and your desired lifestyle.Build your long-term wealth with PracticeCFO. We help dentists analyze ownership decisions, increase profitability, and create financial strategies that support lasting success and financial independence. Listen to Episode 146 of The Dental Boardroom Podcast: https://podcasts.apple.com/us/podcast/146-who-owns-dentistry/id1518344747?i=1000757102884
Wes knows what's best for dental practices. He's been doing this for a long time and he sees lots of practices. He can tell me how our practice is doing, and what we can do to increase our productivity. With past CPA's, there were no ideas. It was all coming from me, saying "I think I can do better, but I don't know how." I come in to meet with Wes and he says "You CAN do better, and I know how."
PracticeCFO is in hundreds of dental offices around the country. They know what numbers should look like. They know what percentages of payroll, rent and supplies should be, and they will hold you accountable to those numbers, which will really help you stick to your plan and your path of growth and savings. That is invaluable
Whenever something comes up, whether it's building or practice related and we weren't sure where the numbers would go, PracticeCFO has been instrumental in helping us figure that out. I can't say enough of how important that is - that it goes beyond that initial partnership. They make sure this business marriage works.
When I go home from work, I don't spend a whole lot of time stressing about what my books look like, or how much I owe in taxes. By using PracticeCFO, the burden of keeping track of a lot of the big financial numbers and metrics are taken off my plate.
PracticeCFO helped me develop a plan for the future. I have colleagues that work with other accountants that don't have a plan - they just look at the numbers of the practice and that's it. There's no plan for 10, 20 years from now. But with PracticeCFO, you get that. PracticeCFO makes you feel like you're they're only client.
(In reference to his practice sale) What could've been super stressful, wasn't! When picking John and Wes, it was from word of mouth recommendations and other people's experiences from the past that really did it for me. And it turns out that those recommendations were right on the line.
Wes knows the business side of dentistry. His comprehensive plan will organize your personal and professional finances so you can focus on taking care of patients. Massive ROI.
I can’t say enough good things about everyone at PracticeCFO. Everyone on the team is professional, organized, knowledgeable, helpful and kind. They also respond to emails and phone calls immediately and are always happy to help. They have helped me navigate year-to-year as a business owner. PracticeCFO gives me peace of mind that my business is in good hands.
I love Practice CFO! They have helped me obtain a practice and maintain a practice. They are incredible people who are on top of everything and make owning and running the business portion of a practice easy. They couldn’t be better for my business and my sanity. They have every detail of the business and taxes taken care of where all I have to do is show up and follow their easy steps to success!
Practice CFO has the best tools I’ve seen for personal tax and financial planning in addition to top-tier corporate tax and accounting services. I have been very pleased with the level of quality service. They manage my monthly bookkeeping and accounts payable. It is a great system and saves me a ton of time, and it allows us to have monthly financial statements within a week of month end.
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