Written By Jake Courtney, CFP®, CSLP®
Updated on November 13, 2026
Burnout pushes more dentists into bad investments than anything else I see. It starts after a full day of crown preps, when you're wiped out and scrolling a dental Facebook group. Someone has posted about a real estate syndication, a crypto meme coin or a franchise that changed their life, and part of you wants to hang up the handpiece and try it.
That pull makes sense, because in dentistry the more you work, the more you make. Add a day a week and your income goes up, but so does the burnout, until the whole thing feels like a hamster wheel. Stack a mountain of student loans on top, and it's easy to feel like you're falling behind.
Those bets might get you rich quick, but they can get you poor quick as well. The better approach is less exciting: own a globally diversified mix of low-cost index funds, and manage it with taxes in mind. Here are the two mistakes I see most often and what I'd do instead.
The trouble with picking single stocks
Single stocks are really hard to predict, and the ones dentists buy tend to be priced for perfection. About 95% of the single stocks I find in new client accounts are tech or crypto, usually something like Nvidia or Tesla. Those clients keep buying more until 75% of their wealth sits in one to four stocks. One number, the P/E ratio, explains why that's risky.
What a P/E ratio tells you
Take a company that trades at $100 a share and earns $20 a year per share. Its price-to-earnings (P/E) ratio is 5, and that's the most common apples-to-apples way to compare stocks. When the number climbs, investors are paying today for earnings they expect years from now. Nobody expects a boring, low-margin grocery chain like Kroger to grow its earnings 10 times in five years, so investors won't pay a big premium for its stock.
SpaceX went public before earning a profit, so you have to use price-to-sales instead. Picture a dental practice that collects $1 million a year. If it were a SpaceX dental practice, at its peak it would have been worth about $100 million. That gap is what the old saying gets at: “In the short term, the stock market is a voting machine. In the long term, it's a weighing machine.” People buy vibes and stories in the short term, but over decades, the fundamentals (a company's actual earnings) always win.
Cisco took 25 years to get back to even
Cisco sold the networking gear behind the internet revolution, and on March 27, 2000, its stock closed at $80.06 with a P/E above 200. The whole index usually trades at a P/E between 20 and 30. Then the dot-com bubble burst, and the stock didn't close higher until December 2025, so anyone who bought at the top waited 25 years just to break even. I think about that every time someone calls Nvidia, up more than 900% in the five years through July 2026, a no-brainer.
The top 10 companies keep changing
J.P. Morgan's quarterly “Guide to the Markets” charts the 10 largest companies in the S&P 500 by decade. The names keep changing:
- 1985: IBM, Exxon, GE, General Motors, AT&T
- 2005: GE, Exxon, Microsoft, Citigroup, Walmart, Pfizer
- 2025: Nvidia, Apple, Alphabet, Microsoft
None of the 1985 top 10 made it to 2025, and only Exxon and GE held on for 30 years. Sometimes leaders get complacent, the way Blockbuster ignored Netflix. As of March 31, 2026, the top 10 made up about 38% of the S&P 500. So who's to say you should bet your retirement, your Roth IRA, on one of them? Based on history, that's crazy to me.
That's why I'd rather own entire asset classes: U.S. large and small companies, international companies and emerging markets. I have no idea which technologies will still matter in 30 years. I do know that as long as people keep waking up, going to work and producing more than they cost, the economy grows, and an index lets you bet on that.
“VTI and chill” ignores your biggest expense: Taxes
If you added up everything you spend out of your gross income, taxes would probably be your No. 1 expense. You just don't see it on your paycheck, and that's the blind spot in “VTI and chill,” the idea that you can buy VTI or VTSAX, add to it for decades and sell shares in retirement.
Dentists usually land in the top 10% of earners and pay a higher tax rate than almost everyone. If you're going for forgiveness on an income-driven repayment (IDR) plan, your student loan payment adds a second charge on that same income.
A single fund works fine at $10,000, or even $100,000, in a taxable brokerage account. Unwinding one VTI or VTSAX position gets really, really hard once it's worth $1 million and you're 40 years old, though. Build with many asset classes from the start, and you'll have far more room to manage taxes, which can make a big difference over your lifetime.
2 Ways I lower the tax bill on your investments
Tax efficiency comes down to two tools: asset location and tax-loss harvesting. Both matter more when you have an IDR payment and a combined tax rate that can reach 50%, as it can at the highest incomes in a state like California.
Asset location
Dividends are forced taxable income. You pay the qualified dividend rate of 15%, or 20% for high earners, plus a 3.8% net investment income tax once your income passes $200,000 ($250,000 if you're married filing jointly). That same income can raise your IDR payment. So I put the higher-yielding asset classes in tax-sheltered accounts like pretax 401(k)s, Roth IRAs and Roth 401(k)s, and keep dividends low in your brokerage account.
Tax-loss harvesting
When a position drops, you sell it at a loss and reinvest in something similar that tracks a different index, like swapping an S&P 500 fund for a total U.S. stock market fund — that’s tax-loss harvesting.
The IRS won't let you buy back the same fund and claim the loss. Up to $3,000 a year in net losses can offset your ordinary income, and anything above that carries forward to future years. A global mix gives you more chances to do this, since emerging markets might drop on a day when U.S. large companies are up. It only works in brokerage accounts, though, because Roth IRAs are already tax-sheltered.
That $3,000 can look tiny when you make $250,000, but the carryforward adds up, especially if you own a practice. Say you buy a practice for $1 million and sell it at 55 for $4 million. Improvements along the way add to your cost basis, but let’s say your gain comes to $3 million, and you owe capital gains tax on all of it. If you’ve harvested losses every time the market dropped in the 20 years before that sale, your carryforward could reach six figures and offset part of that gain.
When it makes sense to hand this off
None of this is as exciting as a meme coin, and it takes steady work. Asset location and tax-loss harvesting need attention day in and day out, and the market is open while you're with patients. A lot of dentists see the sticker price on an advisory fee and decide to handle it themselves. Doing it yourself has costs that are easy to miss, because they show up along the way and at the end, when you sell your investments to live on them.
That's the work we take off your plate at SLP Wealth. Our goal is to get you to financial freedom faster. Book an onboarding meeting, and if a dentist friend keeps calling some AI stock a no-brainer, send them this post.
