114 AUSTRALASIAN DENTIST FINANCE People love to be paid in cash and people love to save their cash – it’s a bit of a conundrum! When it comes to how you should pay for your practice’s equipment, paying with cash might be your vendors preference and seem like the simplest option however, using tax efficient finance can in fact be the smarter choice. Keep your cash reserves for a rainy day The Covid years really taught us that cash is king – when it’s in your pocket, not someone else’s! For many of our medical clients, having access to quick cash at that time helped them navigate the challenges brought about by the pandemic such as business lockdowns. Medical, dental and veterinary practices often face unexpected costs, from staff-related expenses, marketing your practice, to emergency repairs. If all your savings have been spent on asset purchases, there is no slush fund for a rainy day. Access to the latest technology In the healthcare sector, technology is continuously advancing. Ensuring your practice equipment and tech is as upto-date as it can, will drive incremental efficiencies for your business. Borrowing—whether through loans or leasing—will allow your practice to regularly upgrade your equipment without the significant upfront costs associated with cash purchases. This will not only aid in improving patient outcomes through stateof-the-art equipment but also boost your practice’s reputation by positioning it as a leader in adopting advanced technologies. Keep your options open At some stage in your practice's growth, you will likely need additional funds to take the next step. Whether it's purchasing new equipment, stocking up on consumables, or expanding your space to meet increasing demand. By opting to borrow, you can maintain your practice’s liquidity and cover dayto-day operational expenses without depleting your cash reserves. This financial flexibility ensures that you can respond quickly to any challenges that arise, without compromising on the quality of care that you provide to your patients. Tax benefits Borrowing may also provide tax advantages that cash payments do not. Many financing arrangements offer tax-deductible benefits, such as interest payments or depreciation on new equipment. These tax incentives can make borrowing a more cost-effective option, reducing the overall financial burden and making it easier for you to reinvest in other critical areas of your operations. We recommend you connect with your accountant to discuss options best suited to your needs and growth. Better Financial Management Last but not least, borrowing money for equipment will allow your practice to engage in better financial planning and management. With different interest rate options and predictable payments, you can forecast your expenses more accurately and plan for future growth. This can lead to better budgeting, as your practice would be less likely to face financial surprises that can occur with large cash purchases. The choice to borrow instead of paying cash for equipment finance means you’ll be retaining funds in a bank account and then paying out a smaller amount each month. You may be able to acquire various assets over a period of time rather than restricting yourself to just one, paid for in cash, and with nothing left in the bank. At Credabl, we focus on your growth so you can focus on your patients. With solutions designed specifically for doctors, dentists, and vets, we’re here to help you take the next step with confidence. u Get in touch today or call 1300 27 33 22 to start building the future of your practice. Disclaimer This article is a guide only and does not constitute any recommendation on behalf of Credabl Pty Ltd (ACN 615 968 100) or any of its related bodies corporate (Credabl). The information in this article is general in nature and we have not taken into account your personal objectives or financial circumstances or needs when preparing it. Before acting on this information you should consider if it is suitable for your personal circumstances. Credabl is not offering financial, tax or legal advice. You should obtain independent financial, tax and legal advice as appropriate. Save your cash for the good times: Why financing your equipment can be the smarter choice
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