Defining Debt
If you’ve felt like the economics of running a dental practice have only moved in one direction lately, the latest ADA data offers a reason to pause. For the first time since 2020, average net income for general dentists didn’t decline.
It’s not the start of a boom. Increasing practice overhead, reimbursement pressure, and tighter patient budgets are all still very real. But after years of erosion, holding steady is something to build on.
The Debt Picture for Your Patients
Behind that encouraging news sits a more complicated picture: debt continues to climb. According to the Federal Reserve Bank of New York, total U.S. household debt reached nearly $19 trillion by the end of 2025, including credit card balances that rose 5.5% year over year, according to CNBC. More concerning, overall delinquency climbed to nearly 5%, with severe delinquency topping 16%.
That pressure lands directly on your schedule and your collections. Practices that invest now in reducing barriers to case acceptance, tightening accounts receivable and insurance collections, and negotiating reimbursement rates more effectively are better positioned to weather economic pressure and come out ahead when conditions improve.
Across more than 2,000 practice valuations completed over the past five years, we’ve consistently found that practices with strong collections, efficient insurance processes, and disciplined operations are better equipped to maintain profitability during periods of economic uncertainty. For practices looking for additional support, solutions such as eAssist Dental Solutions can help improve insurance follow-up, collections, and cash flow, while Unitas PPO Solutions can help optimize PPO participation and strengthen reimbursement rates. The same goes for the basics: consistent recall and reappointment processes, stronger verbal skills to reduce cancellations, and active short-notice lists to fill last-minute openings.
The Debt Picture for Future Buyers
Patient debt isn’t the only kind shaping your practice’s future. Dental school student debt is rising too, and new pressure just arrived: legislation that took effect July 1 caps first-year federal student loans for professional degrees at $50,000. Average dental school costs run about $83,000, and fewer than 10% of programs fall under that new cap. That gap means more students turning to costlier private loans, if they qualify, or walking away from dental school altogether.
Fewer dentists entering the profession, or graduates carrying heavier debt, could shift the balance between buyers and sellers over time, creating more competition among sellers and putting greater emphasis on practice quality.
Practices that maximize collections, control overhead, and keep technology and aesthetics current continue to stand out, not only because they’re attractive businesses, but because they’re easier for qualified buyers to finance with confidence. We’ve seen buyers become increasingly disciplined in what they can afford to finance and this has been consistent over the 1,000+ transactions we’ve completed in just the last five years.
Good News on the Financing Side
The other side of the debt picture looks considerably better. Interest rates on practice and equipment loans remain reasonably favorable, with a deep, competitive lending market keeping capital available for qualified buyers. Despite broader economic uncertainty, financing continues to support healthy transaction activity, particularly for practices with strong fundamentals and documented financial performance.
One note of caution: some firms are leaning hard on a “transition now, before debt forces your hand” message, promising less stress and more stability in exchange for selling sooner, often well before your ideal retirement timeline. That trade can make sense for some owners, but it rarely aligns with maximizing long-term value.
Where This Leaves You
Dentistry has historically held up well through economic turbulence, and stronger, better-run practices consistently outperform, day to day and at the negotiating table. The clearest next step is a formal practice valuation. It gives you a real baseline and a roadmap for where to invest, whether that’s productivity, collections, technology, or facility improvements, so you can build value before you transition. Our network of more than 36,000 active dental buyers nationwide continues to generate strong interest in well-positioned practices, even in more challenging market conditions.
