Welcome to the KC CHIROpulse Podcast. This week’s topic: Chiropractic Financial Health.
The KC CHIROpulse Podcast is designed for Chiropractic professionals ready to elevate their practice to new heights. Hosted by Kats Consultants CEO Dr Michael Perusich, both seasoned experts in Chiropractic care and business development, this podcast provides invaluable insights and actionable strategies to help you create a flourishing and sustainable Chiropractic business.
In this episode, we discuss:
Tips to create sound financial strategies in your practice
Ways in which you can invest for financial security
Tips on how much you should save each month
How to monitor the financial health of your practice
…and so much more…
In each episode of KC CHIROpulse, we delve into crucial aspects of building a successful Chiropractic practice, covering topics such as establishing a strong foundation, adopting a patient-centric approach, mastering marketing techniques, achieving financial fitness, fostering effective team building and leadership, integrating technology and innovation, and navigating common challenges in the field.
Whether you're a seasoned chiropractor or just starting your practice, the KC CHIROpulse Podcast offers a wealth of knowledge and practical advice to help you navigate the intricate world of the Chiropractic business. Join us on this journey as we explore proven strategies, share success stories, and connect with industry experts to empower you in your pursuit of building a thriving Chiropractic practice.
Don't miss out on the latest insights and expert guidance. Subscribe now and unlock the secrets to taking your Chiropractic practice to the next level. Your success is our priority at Kats Chiropractic Business Advisors.
DISCLAIMER: The information presented in this broadcast is for educational purposes only and is not intended to offer legal, investment, accounting, or medical advice. Seek the consultation of a professional for advice in those areas.
Be sure to SUBSCRIBE to the Kats Consultants CHIROPulse Podcast When you are ready we can help.
Free Resource: Download What's Your Practice Worth?
Welcome to the KC CHIROpulse Podcast. This week’s topic: Chiropractic Financial Health.
The KC CHIROpulse Podcast is designed for Chiropractic professionals ready to elevate their practice to new heights. Hosted by Kats Consultants CEO Dr Michael Perusich, both seasoned experts in Chiropractic care and business development, this podcast provides invaluable insights and actionable strategies to help you create a flourishing and sustainable Chiropractic business.
In this episode, we discuss:
Tips to create sound financial strategies in your practice
Ways in which you can invest for financial security
Tips on how much you should save each month
How to monitor the financial health of your practice
…and so much more…
In each episode of KC CHIROpulse, we delve into crucial aspects of building a successful Chiropractic practice, covering topics such as establishing a strong foundation, adopting a patient-centric approach, mastering marketing techniques, achieving financial fitness, fostering effective team building and leadership, integrating technology and innovation, and navigating common challenges in the field.
Whether you're a seasoned chiropractor or just starting your practice, the KC CHIROpulse Podcast offers a wealth of knowledge and practical advice to help you navigate the intricate world of the Chiropractic business. Join us on this journey as we explore proven strategies, share success stories, and connect with industry experts to empower you in your pursuit of building a thriving Chiropractic practice.
Don't miss out on the latest insights and expert guidance. Subscribe now and unlock the secrets to taking your Chiropractic practice to the next level. Your success is our priority at Kats Chiropractic Business Advisors.
DISCLAIMER: The information presented in this broadcast is for educational purposes only and is not intended to offer legal, investment, accounting, or medical advice. Seek the consultation of a professional for advice in those areas.
Be sure to SUBSCRIBE to the Kats Consultants CHIROPulse Podcast When you are ready we can help.
Free Resource: Download What's Your Practice Worth?
KC CHIROpulse Podcast. Helping Chiropractors keep their pulse on success. Thanks for listening.
Dr. Michael Perusich:
Chiropractors, how's your financial fitness? Hi everybody. Welcome to the KC ChiroPulse podcast brought to you by ChiroHealth USA and Kats Consultants. I'm Dr. Michael Perusich. I'm your host today, and we are going to be talking about how to create financial fitness for the chiropractic practice, for the chiropractic entrepreneur, And how to do some things to help master budgeting and your investments. As a business owner, we certainly want to be out there producing profits and those kinds of things, but we need to be saving our profits. We need to be spending our money wisely. We need to be thinking ahead, not just for rainy days, but at some point, you're probably not going to be in practice anymore. In other words, you may want to retire. So we have to think ahead on those kinds of things. So I thought today, I just share some thoughts with you. For those of you that don't know, prior to chiropractic, I was actually in the investment banking business in mergers and, mergers and acquisitions as well as direct investments. And so I learned a lot about how to analyze businesses and how investments work and those kinds of things. And so I like to share that understanding with you guys from time to time. When we talk about financial health, I think the starting point is to Our current financial status, where are you with it? You don't sit down and look at your finances Look at your loans, look at your net worth which is your assets minus your liabilities Equals your net worth at least in simplistic terms. So what is your net worth looking like? What is your practice value looking like? So these are Really key things to assess Not only just periodically, but honestly, you should be assessing your practice value every single year. You should be assessing your financial picture about every quarter, and you should be really watching some key metrics in your practice. Now, I know, traditionally, Our profession has tracked statistics like new patients, patient visits, services, and collections. We like to go much, much deeper than that because that, that whole analysis part of your practice is incredibly important because here's the thing, here's the funny thing about statistics, the numbers are black and white, they never lied to you. So because they never lie, they will tell you really. Deep, interesting things about your practice. It'll they'll point out problems before they become big issues. They'll tell you whether you're doing really well or not. So really well and so forth. So we really want to dig in and not just skim the surface by looking at, those top four traditional. Traditional stats, and we can add PVA into that, which Dr. Fox and I did a whole podcast on PVA one time. So you probably already know how I feel about that one, but we need to be really assessing profitability. So we need to be watching our expenses versus our collections. That's incredibly important. We should know what our cost per patient visit is and how much profit we make per patient visit. We need to be tracking our dropout percentages to make sure that we're keeping the practice full of patients and we're not allowing them to drop out faster than we're bringing new ones in. So there's a real fine balance there. So we need to really think about retention. years ago, we used to think that it was new patients that drove the practice. It's really not. Today, we really want to be focused much more on retention. Well, you can tell I got a little bit of sunburn over the weekend because, uh, I live in Florida and so, uh, that's why, that's why I look a little, little toasty today. But anyway, so we want to make sure too that we're really using our business wisely and that we're spending money, not just haphazardly, but we know what we're spending. So we're setting a budget every month. We know exactly what our fixed expenses are, what our variable expenses should be. So what's the difference between the two where your rent, for example, is probably a fixed expense, but your utilities fluctuate every month, right? And unless you're on a flat pay rate. So we want to, uh, we want to really understand what are. All the expenses in the practice and are we driving in enough revenue to make that work? Part of that part of really getting down to the nitty gritty of whether or not you're profitable or not Is really having a good fee steady fee setting strategy We happen to be just a little bit haphazard when it comes to setting our fees far too often and There's really a science to it more than just, well, the chiropractic clinic down the street's charging 49 for a new patient exam. So I guess we'll do the same thing. Your expenses may be much higher and you need to charge a higher rate for new patients, for example. So you really want to dig into your fees and make sure that your fees are set correctly and that you have a good fee strategy in place. That not only brings profitability into your practice, but still looks attractive to, to your patients. And I'm going to tell you something about fees. You don't have to be cheap. You don't have to be cheap. You can make great money in this profession by, by sometimes setting your fees just a little bit higher than everybody else. You don't have to play the race to the bottom fee game. So at least I don't recommend it. We also want to make sure that when we're when we're spending money that we're spending it wisely. So we're not spending money on things that we don't need. We're not buying new tools and toys in the practice that we're not going to use that aren't going to drive revenue that we're really thinking hard and fast about. About tactics and strategies. If you're going to buy new therapy equipment, for example, make sure that you have the strategies in place to make it work. Are you going to use it? Is it going to turn a profit? What is your return on investment going to look like? When do you have it paid off? How many patients do you need to see, et cetera. So you want to make sure that you're really managing money correctly. And I see a lot of doctors being afraid of debt. So they go out, they put. Stuff on credit cards and then pretty soon before they know what the credit card got out of control Go to your bank and get a line of credit line of credit is going to be a much lower interest rate Any money that you're not using of that line of credit you're not paying for it's not these crazy high interest rates Like a credit card every business should have a line of credit and use that line of credit Maybe to buy a new piece of equipment because your accountant says you need to spend some money. So you put it on your line of credit and pay it back over a couple of months when it's only at seven, eight, 9 percent interest. That's way better than your 24 or 27 percent credit card, right? So you're going to pay a whole lot, a whole lot less for it. So we want to make sure that we really apply good budgeting and good cashflow management. And a lot of doctors ask me about things like advertising expense, advertising expenses. One of those variable expenses that should change every month. But yet I see a lot of us getting attracted to these fixed dollar marketing programs where you're spending 2, a month every month. And there's no relation back to ROI and what your collections actually are. You should set your advertising budget. Somewhere between about three to 7 percent of your collections, three to 7%, not 37, three to 7 percent of your collections of your cash collection. So make sure that you're setting your ad budget correctly. And so. and make sure you're spending the dollars correctly and that you're not getting locked into something that, that has a way too big of an impact on your cashflow. So we're talking about financial health for chiropractic entrepreneurs, how to budget, how to, to invest in those kinds of things. So we're going to catch a quick word from our sponsors here. Then we're going to come back and we're going to dump dive into this just a little bit further.
So we all feel it. Rent, or dining out, gasoline, or movies. As a matter of fact, the dollar is not going as far for a whole host of reasons. And it's impacting everybody, regardless of your financial situation. Did you know that 38 percent of the overall population is having to reconsider how they're spending their money just to afford the healthcare they need? And if you break it down further, 26 percent have actually delayed the healthcare that they need. Including going to see you, the chiropractor. So here's what we need to know about the breakdown in demographics. You would think that someone who's making 120, 000 or more would be continuing their care right now. But the actual number is 18%. 18 percent of that group is actually putting off health care. And that's a group of people making six figures. When you take that same information all the way down to a group making 40, 000. That number is much higher. It's closer to 40%. So it's never been more important than now to make sure you've made it easy for your patients to come see you, that you have choices for them, and you understand what they're going through at home. We want to make sure your practice thrives during this time, and we encourage you to learn about what ChiroHealth USA can do for you and your practice, and making it easy for patients to see you and continue care. Hi everybody. Welcome back to the KC Chiropulse podcast. Brought to you by ChiroHealth USA and Kats Consultants. I want to talk a little bit about personal financial management for chiropractors. You know, this is incredibly important. We need to balance our business and personal expenses, but not co mingle them. So work with your accountant. What can the practice pay for? What do you need to be paying for personally? Can you run your student loans, for example, through the business? Can you run your car through the business? So you want to make sure that you have a very strict budget and separation between your personal and your business finances. That's incredibly important. Also make sure that you're saving. We always recommend that you save at least 15 percent of your cashflow every month in the corporation. So get it into an interest bearing account, whether it's a money market account or something, but let it earn a little bit of money for you. But you should be saving 15 percent of your cashflow every single month. And what's that for? Well, it's for emergency funds. It's for expansion. It's for whatever you might need it for when you need it. And of course, if you have a line of credit, you also have extra funds that you can tap into, but we want to make sure we use that line of credit correctly. Also on a personal basis, make sure that you have a good accountant and a good financial advisor and not somebody that just has a bevy of. Mutual funds so they can, they can sell you. You want somebody that actually helps you plan that creates some investment strategies that puts you in a position where you're actually, your, your money's actually earning something. So make sure you set up a Roth IRA. For example, and maximize it every year. If you own the business, you can set up a simple IRA, which is kind of like a 401k. And, and you can put about 14, 000 a year into it. Here's the cool thing. You and your spouse can, if you have, uh, your kids working in the business, they can put money away too. So you can really glean some money out of the practice and get it into savings where it's protected and you're saving for retirement. Also again, make sure that you've got some good investment strategies. If you're young and fairly new in practice and retirement years or 35, 40 years away, you, you may want to really be in, in a high growth mode. If you're approaching closer to retirement, you may want your investments to be spinning off more dividends and more,, cash and so forth in the beginning when it's possible by home, it's a great investment. Your home typically goes up in value over time. It's just a great way to save, and there's, when we talk about investments, there's all kinds of things that are, that are completely suitable for, for doctors, real estate, great investment opportunities, stocks, ETFs, ETFs are, are I think one of the greatest things, because it's kind of this hybrid between a mutual fund. And a straight up stock investment and you get a, you get a lot of bang for your buck without the expense load that most mutual funds have. Bonds can be great for generating income and make sure again that you use those retirement accounts and always make sure that your investments are diversified. Don't let just a bunch of cash just sit there on the sidelines doing nothing. Make sure that you're thinking long term and that you have your money working for you. Now, there's also some financial mistakes that we want to make sure that we avoid. So there are some common financial pitfalls that we see a lot of doctors fall into. One is the shiny thing. What's the shiny thing? Where you go to a convention and you see a brand new therapeutic device and you think, Oh my gosh, I got to have that. And you don't really think it through. You don't think about. Well, do I have any patients that can use this, maybe get attracted to a decompression table, but you forget that you're pediatric practice. So you probably don't have many patients that can utilize. The decompression table. So that might not be a good idea to buy. Right? So that's a financial pitfall that you want to make sure that you avoid. We all get caught wasting money on something somewhere along the way, but I always use this rule of thumb. If you're going to make a decision about buying something and it's over a certain amount, if you're new in practice, maybe if it's more than 500, if you've been in practice, well, maybe it's more than a thousand dollars table, the decision. For 24 or 48 hours or even a week, if there's no burn, no rush to make the decision, don't make it just yet. Think it through a little bit, let your subconscious work on it. Also make sure that you get good professional help, good, uh, financial strategist, a good, family planning attorney, one that can help you set up a will and those kind of things. Very, very important, especially if you're having a family and those kinds of things. Make sure you have a good accountant. Meet with your accountant a couple of times a year, not just a tax time to turn over all your tax documents. Make sure that you're meeting with them and really understanding how to read your. Profit and loss statement, how to put your balance sheet together, how to value your practice. And in fact, at Katz Consultants, we, we help doctors value their practices. We think you should value it every year and hopefully you see it going up. And if it's not, that's one of those statistical measures that. We've got you if you've got time if you're not selling your practice in the next six months You may have time to kind of turn that around And make your practice continue to grow on your balance sheet the value of your practice grow. So Make sure you're getting good financial advice good attorney good accountant good. Investment advisor. Those kind of people can be invaluable to you. To make sure that you have good software in your practice. And what do I mean by that? Well, good software that's tracking your A. R. So that you don't have money falling through the cracks. Make sure you have good procedures in place that you're reviewing your bees if you're in insurance and not writing off stuff that shouldn't be written off and not giving away services that you don't need to be giving away. So really having them. Thank you. Good strategies in place for those kinds of things can really help. You'd be shocked. You'd be shocked at how much extra money just by paying attention you can bring into your practice into your bottom line just by doing some good strategies with making sure that you're not giving away services when you shouldn't be. And this is such an important topic that I think it's really should be second nature that you need to learn So if this is not an area that you're very familiar with learn, there's great books videos learn how investing works It doesn't mean you have to go out and be an investor or a day trader That's not what i'm talking about, but understand because learning is key to success So make sure you do those kind of things and if you're kat's client, you know that we already Put on a lot of classes and seminars and things for you guys about investing and about the importance of those things. So good financial management is again, paramount to your success. So make sure that you're budgeting, make sure that you're investing, make sure that you've got your fee strategy set correctly. Analyze your insurance contracts every year. Are you getting reimbursed? Anything? Is it even worth being on those insurance plans? Maybe it's time to switch patients over to cat, learn good retention strategies, learn how to analyze your practice from a statistical point. Not just the simple stats that we typically do in the profession, but really a deep dive, On your statistics and make sure you're keeping up with that. Also be sure to check us out at Katsconsultants.com. We've got all kinds of free downloads, uh, subscribe to the, to the podcast, make sure you're tuning in every week. Dr. Fox and I like to. Completely dismantled and disrupt how we're managing our chiropractic practices in the profession. We love sharing our ideas with you guys, and we've had huge feedback, uh, since we started this podcast and it's growing like crazy. So be sure to share it with everybody, in the profession as well. Also, be sure to check out our sponsors ChiroHealth USA. They're doing amazing things for practices as well as KATS consultants. That's our consulting company. If you haven't done so yet schedule a breakthrough call with us. We love doing these We love talking to you guys about your practices. It's free. There's no catch we don't strong arm anybody, but we want to hear about your practice How it's going and how we might be able to help you make it even better. So All right, everybody keep helping your patients and, get a good management company behind you to, to consult with you and coach you on making your practice even better. All right, everybody, Dr. Michael Parush here with KC ChiroPulse podcast. We'll see you next time. Kat's Chiropractic Consultants your partner in chiropractic success. We are dedicated with one on one guidance to bring you all your practice management needs. Let's supercharge your practice. Give us a call today.