4 Steps to Build a Better Budget for Your Orthodontic Practice

How to Improve Orthodontic Practice Profitability with Financial Management Software

• A strong budget gives you more control over profitability, especially when growth isn’t coming from new ortho patients.

• Start by reviewing last year’s numbers to see where your money went and what limited your ability to reinvest.

• Focus spending on what’s driving growth and reduce what isn’t delivering a return.

• Monitor financial performance regularly so you can spot issues early and make smarter adjustments.

• Gaidge’s Executive Membership helps you create a better budget, monitor overhead, and forecast revenue with confidence.

A solid budget is one of the most powerful tools you have to improve your orthodontic practice’s profitability.

And we've seen it play out in the numbers: Our latest Orthodontic Trends + Insights show that production improved last year, but patient starts stayed flat.  

In other words, many practices aren’t growing from higher volume. They’re growing by making better use of what they already have.

That shift isn’t accidental. Between rising costs, insurance delays, and more practices competing for the same patients, growth now depends on how well you manage what’s already coming in.

In this post, I’ll walk you through four steps to build a stronger budget with Gaidge’s Executive Membership—so you can make clearer decisions, stay on track, and keep your practice moving forward.

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Step 1: Assess Your Current Financial Health

Before you plan ahead, you need a clear picture of how your practice performed last year: what you brought in, what you spent, and where the money went.

Ask yourself:

• How much did we spend on staffing, clinical operations (like dental supplies, aligners, and lab fees), equipment, marketing, and admin?
• Did we stick to our budget, or did some areas run over?
• Were we able to reinvest in growth, or did expenses get in the way?

If you’re not sure where to start, Gaidge gives you the numbers. The Overhead Summary report breaks down spending by category so you can see exactly where your money went. And with comparison tools, you can measure last year’s performance against previous years to spot trends and outliers.

Data Tip  
The average contract amount in 2024 was around $5,600. If yours is lower, it may be time to revisit your fees or look more closely at your collections.

Step 2: Allocate Expenses Strategically

With a clear picture of last year’s spending, now you can decide where to focus moving forward.

Start with the four core categories of orthodontic practice spending:

1. Staffing  
2. Marketing
3. Equipment
4. Rent and supplies  

Look at how much each category costs you, and whether that investment is actually supporting growth. Are there areas that could be trimmed without affecting patient care? Are there others where spending more could lead to better results?

Some of the most effective budgets I’ve seen shift dollars toward high-ROI areas, like marketing channels that consistently bring in new patients. Others find quiet wins by reducing supply waste or renegotiating vendor costs. The key is making sure your spending aligns with your goals, not just your habits.

The Overhead Budget dashboard in Gaidge’s Executive Membership helps you track budget categories easily, compare monthly or yearly budgets, and set alerts if spending starts to drift off course.

Data Tip

Industry benchmarks recommend keeping orthodontic overhead below 57% of projected revenue. If you're consistently over that line, it's worth digging into your spending categories and tightening where you can.

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Step 3: Track Spending in Real Time

Creating a budget is one thing; keeping up with it is another. Too often, practices build a budget at the start of the year and never look at it again. But if you’re not monitoring where your money’s going, it’s easy to overspend without realizing it.

That’s where real-time tracking makes a difference. It helps you stay flexible when revenue trends shift and gives you the chance to course-correct early (before small issues turn into bigger ones). It also keeps your team aligned around shared financial goals.

To get a clear picture, your expense data has to be categorized correctly. If dental supplies are lumped in under aligners or marketing expenses get mislabeled, your numbers won’t reflect reality—and your decisions won’t either.

Gaidge’s Overhead Expense Tracker ™ automatically pulls nightly updates from QuickBooks™ and Xero™ to help you track spending. You can assign access by role, monitor spending by category, and catch red flags early instead of waiting for end-of-quarter surprises.  

Data Tip

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Tracking Net Production vs. Net Collection can help you spot financial issues before they affect cash flow. Practices that monitor expenses consistently are often the first to notice seasonal shifts and the fastest to respond.

Step 4: Fine-Tune and Optimize for Profitability

Once your budget is in place and you're tracking it consistently, it’s time to look for small improvements. These adjustments don’t need to be dramatic, but they do need to be intentional.

Start by reviewing how your spending has shifted over time. Are certain categories trending higher than they should? Are you over budget in places that aren’t supporting growth? Or are there areas that deserve more investment? When you understand those patterns, you can make intentional changes that actually reflect what’s happening in your practice.

The Overhead Reports dashboard in Gaidge’s Executive Membership helps make that process easier. You can drill into categories, track spending over time, and make smarter decisions as you move forward.

Data Tip

Retention rate has increased slightly, giving you more chances to stay connected after treatment. But with repair rates still sitting around 8%, it might be worth taking a closer look at your clinical systems to spot any gaps in efficiency.

Turn Orthodontic Financial Management into Practice Growth

Budgeting plays a bigger role than most practices realize. When you understand where your money’s going, it’s easier to catch problems early, stay on track, and make smarter reinvestment decisions.

With Gaidge’s Executive Membership, you can track revenue in real time, forecast with confidence, and manage your budget with the clarity your practice needs to grow.

If you're ready to make better financial decisions and take control of your growth, let’s talk. Book a demo and see what’s possible with Gaidge.

About the Author

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Mallory Boyd is a consultant with Gaidge 360 Consulting, where she works with orthodontic teams to improve profitability and bring more structure to their financial systems. She has an MBA and a strong background in practice finance, helping doctors and staff build smarter budgets, clean up reporting, and make decisions with clarity.

Orthodontic Practice Budgeting FAQs

How often should we update or revisit our practice budget? Most practices build an annual budget, but it shouldn’t stay static. Reviewing your numbers quarterly—or even monthly—can help you adjust more quickly when revenue or expenses shift.

What percentage of revenue should go toward staff, marketing, or clinical costs? There’s no universal formula, but benchmarking your spending against industry norms (and similar-sized practices) can reveal where you may be overextended or underinvesting.

How do I budget when my revenue is unpredictable month to month? Use your historical data to identify seasonal patterns and create a rolling forecast. This helps you plan ahead for leaner months and avoid overspending when revenue dips.

What’s included in Gaidge’s Executive Membership? Gaidge’s Executive Membership includes advanced tools like the Overhead Expense Tracker™, Practice Projections™, and Overhead Reports. It gives you real-time financial visibility and lets you track, compare, and plan with confidence.

How does Gaidge 360 Consulting help with budgeting? Gaidge 360 Consulting gives you one-on-one access to experts who work directly with your practice to clean up reporting, restructure budgets, and align financial goals with industry benchmarks.