Worthwhile Expenses for Your Practice
We’ve all heard a version of this story — There once was a man who, when he got to the pearly gates of heaven, asked St. Peter , “Is God really listening to all the prayers down there?” St. Peter looked back at the man inquisitively, so the man went on, “I mean I prayed everyday for 50 years to win the lottery, but I never won.”
To which St. Peter replied, “Yet despite every message and advertisement we stuck in your face, you never bought a ticket. Which of you is it that isn’t listening?”
Now I am not saying that every ad in your Facebook feed is a message from God, Goddess, Allah, Buddha, the universe or the like, pointing you toward your answered prayers. What I am saying is that if you want a seat at the table, you have to pay the entry fee. You have to invest in your dreams rather than sit idly by and wait for opportunities to just rain down upon you.
I know I write a lot about saving money and how to be thrifty when opening a private practice. I would like to balance that out by also talking about some worthwhile expenses for your new or growing practice. So, if you’ve ever asked yourself, “what should I be spending my money on to grow my practice?” Here are your answers:
Office Space. Your biggest expense is going to be the space you spend your time in. Even if you are 100% virtual, you are inviting your colleagues, clients, and potential clients into your space. That space and furniture in it should represent the value you have in your services as well as reflect the value you want your clients to see in themselves.
Thanks to the pandemic and hundreds of Zoom meetings over the last 2 years, I have seen the insides of hundreds of work spaces - many of them quite depressing. Your space represents you and when it comes to first impressions, can define you. Make sure your office space is tastefully decorated, uncluttered, well lit, conveniently located, comfortable, and exceedingly welcoming.
The most commonly suggested ratio of gross income to rent is 30%. So, for example, if you are bringing in $4000/mo in gross revenue, your rent will likely be around or just under $1200/mo. Of course, this number changes depending on your geographic area and the demand for office space there. You can bring that expense down by renting by the hour from a co-op or office share company or subletting from another therapist. Do NOT cut this expense down by housing your practice in a cheap, run down, unsafe, or sketchy building/area.
Business Coaching. You do not need an MBA ,nor do you need to spend the equivalent cost of an MBA to get supportive business guidance. However, be prepared to shell out around $200 a session, and often much more, to get expert advice and guidance from a coach. If you want to be on the fast track and skip the part where you make a bunch of “cute” mistakes and learn from them, then invest in a coach. They can help you leap over common pitfalls and fly up to your next business goal faster and easier than you doing it all on your own.
Records Management and Storage. EHRs (Electronic Health Records) apps are everywhere. They have streamlined our industry like nothing else before it. These robust software programs provide you with prebuilt paperwork, scheduling systems, billing services, treatment planning applications, virtual meeting platforms, secure messaging with clients, and so much more. Yes, you could cobble all this together with free apps and do old fashioned paper files, but how much is your time worth now? If you are charging $150 an hour and it takes you an hour a day to schedule your clients, invoice them, collect on that invoice, and write your notes, wouldn’t you rather make another $150 instead?
Website. Number 1 question my practice mentoring clients ask me — “Do I really need a website?” Short answer - Yes. Longer answer - Yes, if you want people to know you exist. There are many ways to get the word out about your services. You can network, bring muffins to the doctor’s office, schmooze the teachers union, create a Facebook Page, and have a profile in an online directory. However, people shop for everything by researching online before they buy. If you do not have an online presence other than that profile page, they can’t get to know you.
Websites can cost as little as $15-20/mo for one you build yourself with easy drag and drop apps like Squarespace and Wix, but it will cost you in time as you build and tweak and build more and tweak more. For upwards of $3000, you can have a developer build it for you. This decision is up to you. If you have little to no tech experience, then leave it up to the experts, bite the bullet, and plunk down the investment. My recommendation here is that you look into companies that specialize in building sites for therapists and NOT hiring your cousin’s roommate who made a site for her band that one time. BetterVision and TherapySites are both great options.
The Necessities. Then, of course, there are the necessary expenses of a private practice:
Malpractice Insurance (don’t be afraid to shop and negotiate or this to get a better price.)
Business license (depending on the requirements of your city)
Business insurance
Online Directories
Business email and phone
Telehealth platform (if you are virtual)
Reliable Wifi (if you are primarily virtual, consider upgrading to fiber if possible)
Computer
Tissues, pens, paper, spare cleaning supplies
Written by Casey Limmer, MSW, LCSW, owner and founder of St. Louis DBT, LLC and Gateway Wellness Associates, LLC. Casey has a passion for helping wellness professionals, therapists, and counselors to access their inner entrepreneur and start the practice of their dreams. If you are interested in Business Mentorship with Casey, click here for more information.