New Year Slump? Time to Get Your Affairs in Order!
Many practitioners find their work slow at the beginning of the year. Clients are feeling the pinch from spending too much at Christmas and are full of good intentions to implement resolutions that will change their lives for good. If you are finding that you have time on your hands, maybe it’s a good time to get done all those little tasks that we keep putting to the end of the “to-do” list.
Planning for retirement
Many people have great plans for what they will do when they retire and don’t have to go to work any more; travel, take up a new hobby, go back to college. But will you have the money to pay for these plans? You may not have given it a lot of thought, especially if you’re still under forty. But if you leave it too long, you may find yourself at retirement age with lots of time on your hands, great ideas about what you’d like to do, but no money to enjoy it. Depending on your work history, the basic rate of the state pension may be a maximum of between €219 (non-contributory) and €230 per week (contributory).
So, if you are relying on the state pension to feed and clothe you, and keep you warm, you can imagine that it won’t go very far.
Therapy and counselling practices are income generating rather than capital accumulating mechanisms. In other words, your practice will only generate money as long as you are at work in it. And while there may be some residual value, in most cases there will be none or very little, so you should not depend on selling your practice in order to fund any part of your retirement.
The time to provide for your retirement is while you are at the height of your earning power, and the sooner you get started the better. The earlier you start, the smaller the proportion of your income you will need to set aside, and conversely, the later you start, the more you will need.
If you haven’t made any provision as yet for your retirement, talk to a financial advisor or your bank about the options available.
If you had to withdraw from your work suddenly, through illness or incapacity, what would happen to your practice? Would your family and colleagues know what to do?
By putting in place a few simple processes, you can make life easier for those who might be left to pick up the pieces. And it is especially important if you practice on your own with no partners or colleagues.
Here are a few ideas.
Make a list of people who should be contacted in the event that something happens to you. These should include clients (first name), your supervisor, and the name of another practitioner who is willing to see your clients on a short term emergency basis. Place the list in a sealed envelope and tell someone (family member or colleague) where it is. You’ll need to update it regularly.
An alternate is another practitioner who has agreed to provide emergency holding for your clients, should you be pulled out of your practice at short notice. They may also be willing to be available for working on an ongoing basis with longer term clients, should you be no longer able to do so. While this applies in the event of a sudden illness or incapacity, if you work with clients who are in crisis, it might also be prudent to some arrangements in place for when you take a long haul or extended holiday. (Remember the volcano ash cloud and how many people got stranded abroad?) The time to talk to someone is not when the emergency has happened. The best time to do it is now! You can read more about alternates here and more about what should be in an alternate agreement here.
Personal Affairs Checklist
If you’re like most people, your personal filing is a system known only to you, and incomprehensible to even your nearest and dearest! Would anyone know where to find your bank statements, or where you keep your will, insurance policies or other legal documents? But you don’t need to change what you do or where you keep things, Chartered Accountants Ireland has a great checklist in which you can note down the location of the most common items that might be needed in case of emergency. You can find it here.
Have you made a will? Many people in Ireland grew up with the belief that making a will was tempting fate. However, if you have ideas about how you’d like your estate to be left, you should get it down on paper. Don’t skimp on costs by doing it yourself, it’s a small cost to have it done professionally, and you can rest easy in the knowledge that your wishes will be observed. If you don’t make a will, your assets will be distributed according to law. If you would like to know more about wills and the law Read the Law Society Guide here. Or ask your solicitor or local citizens information office for details.
It might seem daunting, but there’s lots of help out there. So take the issues one at a time, and by this time next year, you’ll be surprised by how much you will have achieved.
If you’d like help with any aspect of running your therapy practice, please contact me, by email (click on the link) or by leaving your query or question in the box below.