Dear Dangerously in Love with Your Finances,
I am a marriage and family behavioral health therapist in Seattle Washington. After working at a behavioral health group practice for ten years, I decided to take a leap of faith, work for myself, and open my own practice.
As a new business owner, I am eager and prepared for the entrepreneurial journey. However, I am a little worried about the financial side of the business. As an employee, I only had to see patients, and now as a business owner, I need to concern myself with much more. What expenses should I anticipate as a new behavioral health group practice owner?
~ Nervous About Finances
Dear Nervous About Finances,
First, congratulations. Please know that it’s normal to be scared while embarking on a new journey. The truth is that when I launched both of my accounting firms, I was initially apprehensive. I am a bit nervous now, as I reply to your question. But guess what? I embrace the emotion because I am strong and daring enough to pursue something I enjoy.
The financial side of any business can be a bit daunting for new business owners. But it doesn’t have to be, especially if you are proactive in what you need to know and learn about accounting and finance. So, your question is right on point. Because you were an employee, you may not have seen the actual financial picture. To answer your question, the most common expenses for behavioral health practices are:
- Liability insurance
- Business insurance
- Marketing (website maintenance, SEO, content writing)
- Utilities (internet, phone)
- Software (accounting, EHR)
- Billing – if you decide to take insurance
- Continuous education
- Paying yourself
A Closer Look at Expenses
One thing to consider is that in today’s environment, most behavioral health therapists offer remote therapy, however, if you choose to take appointments in-person, rent should be on the list. Sometimes it is nice to get out of your home and go into an office so you can separate your work from your personal life, which could also influence your decision to rent a space.
On a separate note, you’ll notice that I put paying yourself on the list. Why? Because most small business owners forget to do this. You didn’t go into business for yourself, not to get paid. Paying yourself is as important as paying rent and all other expenses.
Set Yourself up for Success
Remember that the exact balance of expenses is different for each and every practice depending on the location of the business, the number of staff, the equipment needs, and so on.
As you begin this endeavor, make things easier for yourself by being intentional to carefully track and observe your expenses from the start, potentially with medical bookkeeping software if desired.
This care will help you keep your books organized and allow you to stay knowledgeable about the financial ins and outs of your specific practice.
By writing to me you are already thinking ahead about developing a full understanding of your medical office bookkeeping, which is great to see. If you want to further your education through financial literacy coaching, please do let me know.