A Moment of Truth

By David Phelps, D.D.S.

This was never part of the original plan…

I had laid out my entire life in advance. “I’ve got this – the sky’s the limit.” I was blessed with good intellect and a work ethic to boot. Failure was not an option. I would have a perfect family. A perfect life. A perfect professional practice career.

But there I was, sitting on the small, vinyl, padded bench in Jenna’s hospital room. The IV machine humming, holding several bags of fluids and meds, dripping into the tubes and through the needles that ran into her small, bruised hand.

Jenna, only twelve years old, was asleep, her body still trying to recover from an exhaustive six hours of surgery removing her cirrhotic and failed liver and replacing it with the gift of life – a donor’s liver.

Away from my busy and stressful practice, I had a lot of time to think at that hospital.

No cell phone access. Disconnected from the rest of the world, nothing else mattered. All of the daily “stuff” that had seemed so paramount wasn’t even a blip on my radar.

All of my education, wisdom, and experience; even all of the money I could earn – none of it mattered. None of it could make a difference.

I could only hope.

Hope and pray that Jenna would recover and I would get a second chance. A second chance to be a father – a real father who would be present, not absent. Not preoccupied with “stuff.”

Would there be a “someday?” A day in the future when I could spend quality time with Jenna?

Time is never on our side. It marches on. There is a limited supply for each one of us. Tomorrow is not promised to anyone. Life is a gift.

It was during Jenna’s initial weeks of transplant recovery, while spending day after day at Texas Children’s Hospital in Houston, that I made a critical and life-changing decision.

A moment of truth: I would no longer practice dentistry.

Creating a Plan B. While a senior in college, I began reading books about investments (I always had a knack for planning ahead). I read books about stock market investing and some about real estate investing. Comparing the two, real estate won hands down. It was a tangible asset that I could control.

Investing in the stock market made no sense to me.

During my first year of dental school at Baylor College of Dentistry in Dallas (1980), I talked my dad into being my co-venture partner in acquiring a two-story brick rental house (an estate sale) in a solid Dallas neighborhood. We followed the fundamental rule of real estate; buy the worst house in a good neighborhood.

I learned how to manage this first asset for rental income. After graduation from Baylor in 1983, we sold the house and split about $50,000.00 in capital gain profit (capital gains are taxed at a much lower rate than ordinary active income).

The epiphany for me was in realizing that I made a capital profit of $25,000.00 from this one real estate asset during the same period of time that I worked many, many hours as a waiter at night and on weekends with much less to show in net income.

Why should I work for money all of my life when I could acquire good capital assets that would work for me whether I worked or not?

I began to understand that if I could acquire enough assets, I wouldn’t have to work as hard… maybe not at all.

By continuing to purchase and invest in real estate, I was transitioning from working for money to investing money in capital assets that would produce cash flow, preserve and build wealth. This was my “Plan B.”

Creating a Plan B was the key to my financial freedom. It was there when I needed it or wanted it.

In 2004, with Jenna in the hospital, I decided to pull the trigger.

Hard work, sacrifice, and a disciplined approach to real estate investment provided the foundation that allowed me to give up my good, but very restrictive, career as a dentist.

It wasn’t an easy decision, but I had a real reason to follow through with it.

Today, she is in college working towards an Associate’s degree in occupational therapy. A published author and speaker, she’s got the world by the short hairs. Pretty good for a kid who, at age sixteen, was reading and writing at a second-grade level! She had suffered through intense chemotherapy as a very young child to fight high-risk leukemia and suffered epileptic seizures from age eight to twelve. She missed the first thirteen years of a “normal” kid’s life.

Courageous, driven, tenacious, a fighter. My girl.

Today, David Continues to Be Passionate About Financial Planning for Dentists & Orthodontists

Why Do You Do What You Do?

“David,” other dentists ask me, “why aren’t you retired?”

What they mean is, “If you did so well with real estate and dentistry, why are you still going at it?”

Fair question. It’s true that I don’t need to do… anything, really. For me, I do what I do, because it’s the most significant way I can invest my time.

I have a genuine passion for helping my colleagues break the chains from being slaves to their dental practices. I want to help them overcome their financial fears, so they can create freedom in their lives and the lives of their families. This passion demands my attention.

I love the fact that this gives me a platform and brings some of the best and brightest people in all areas of business, marketing, real estate, and finance, to Dallas four times a year.

This community is my best insurance policy. With the volatility and unknowns in our economy and industry, bringing together a Board of Advisors allows us to stand apart from the fallout and find the opportunities that chaos brings.

Being in the middle of all of the real estate opportunities within our group allows me to put deals together and help our members use various buckets of investment capital in the safest, most efficient, effective means possible.

Having the freedom to retire, and actually doing it, are worlds apart for me. I’ll likely never retire in the typical sense. Remaining significant and relevant until my body and mind gives out, now that sounds like a plan!

My community and relationships gives me the platform to do just that.