When I left my job in the accountancy profession to finish my training as a therapist, I was surprised by how difficult I found the transition to being self-employed. I had been self-employed before, so I thought it would be easy to do it again, this time as a therapist. What took me most by surprise was the challenge of feeling isolated. I was lucky to have a close alliance with a colleague with whom I shared a lot of the set up tasks, and this made it immeasurably easier. Nonetheless, there was a deep sense of being on my own, and a shame that with my background and experience, it should be much easier. Read more
Tag: therapy fees
It’s hard to imagine two professions that are less alike than psychotherapy and criminal law. Or so you’d think! After all, criminal law deals with laws and rules, with evidence, argument and ultimately, with winning or losing. Not concepts that you learn in therapy training!
I had the pleasure recently of meeting a group of criminal lawyers. Listening to their stories about their practices and the struggles they are dealing with, I found myself thinking how much the two professions have in common. Read more
How do you know you’re earning enough to pay your bills? You may remember that this was a question I addressed some weeks ago, when I showed you how to calculate the Break Even Point for your practice. (You can read the article here.)
Calculating the Break Even Point gives you an idea of the number of clients you need to see in order to cover your costs. Or if you work a consistent number of hours, it tells you how much you need to charge for each hour you work.
So, having calculated your Break Even Point, and you know what you need to do, then what?
Well, the break even point is what’s known as a Key Performance Indicator or KPI. In other words, it’s used to help you keep track of how you’re doing in your practice, financially speaking, without having to go to the trouble of preparing regular financial accounts. You find one figure that tells you whether you’re roughly on track or not and use that as a bench mark. KPIs vary from business to business, and from practice to practice. They may be stated as we have already seen, in terms of clients, time or money. Read more
Assertive behaviour can help to create a more profitable therapy practice. Often confused with aggressiveness, which is concerned with winning, Assertiveness is stating clearly and directly what you want or how you feel about a situation. It is a both/and position rather than an either/or, and is based in mutuality of respect for ourselves and the other person.
In any given situation, behaving assertively helps ensure the needs of both parties are met, helps you to stay firm in negotiation, and helps recognise the position of the other without necessarily giving ground.
Situations in which Assertiveness supports profitability in a practice include: Read more
How Many Clients Do I Need Or How Much Do I Need To Charge
In Order To Breakeven
Your total income from your practice is affected by 2 main factors: the price you charge, and the number of hours you work for which you get paid. A change in one factor leads to a higher or lower total income. If you increase your price, and work the same number of hours, your total income over a period (say a year) goes up. If you work fewer hours but keep the price the same, your income goes down.
“Breakeven” is the point at which your income equals your expenses. If I earn more than the breakeven I make a profit, or net income. If I earn €100 in fees, and it costs me €80 in expenses, the difference (100-80=20) is profit or money I can spend. If I earn less than breakeven I make a loss, or net expenses. If I earn €100 in fees, and it costs me €120 in expenses, I need to find the difference from somewhere, in order to ensure all my expenses are paid.
Why is breakeven important? Breakeven gives a benchmark for the minimum you need to earn in order to cover your costs.
Remember those bedtime stories you loved as a child? Remember how they made you feel warm and comfortable inside, as you knew every word and every twist and turn of the story? Remember how, even though you knew it was coming, even though you knew it was only a story, you still felt the start of fright at Grandmother’s teeth, “all the better to eat you with,” or the giant saying, “I’ll grind his bones to make my bread.”
I was reminded of this during the week, when I was triggered, and I mean really triggered. I found myself back telling one of those old stories again. Maybe you’ve heard it? It was the one about how someone did something bad, and they did it to me, because everyone has always done those awful things to me…Get the picture?
It’s that time of year again, when those green forms from the Revenue appear in the letter box, and you promise yourself that this time next year it will be a different story. This time next year, you’ll have found a way of keeping track of your practice finances, so that you’re not facing a climb up Mount Everest in order to meet the submission deadline of 31st October.
Except that, this year, the deadline isn’t the 31st October, unless you plan on calculating your own tax liability. This year, for the first time, there may be a penalty for not calculating your own tax liability, unless you submit your return by 31st August 2014. Read more
Someone told me recently that I can make the issues I write about here seem easy and enjoyable, and of course, that’s how I want it to be. However, there’s a saying in therapy, “Don’t mistake the map for the territory.”
I was reminded of this sharply at a workshop at the weekend when the topic under discussion was very alive in the room between the members of the group. As we tried to absorb the theory that was being presented (the map), the real live example was there in the body language of the participants. I found myself thinking that it’s all very well to understand what’s going on, and it’s another thing to live it.
Value for money is so subjective, isn’t it? And it’s also a very personal thing. What is a necessary expense for one of us, is a frivolous luxury for another, and vice versa. Writing about our values and beliefs about money recently left me thinking about the value we place on experiences and on things, and how that varies so hugely from person to person.
Ray Pembroke, Chartered Accountant, of Pembroke & Pembroke, Kilkenny, has some sage advice for those starting their own practice:
“So you have decided to set up as a Self Employed Therapist. In order that you can build a successful and viable Practice I would recommend that you follow this 10 Point Plan:-