May 21, 2025 • 18 mins
Craig addresses the challenges of running a successful therapy practice, sharing insights on setting fees, creating consistent income, and making strategic hiring decisions.
• Setting appropriate fees requires knowing what income you need, how many clients you can realistically handle, and calculating your session rate accordingly
• Consider both personal income requirements and business overhead when establishing fee structures
• Some potential clients will be deterred by higher rates, but those seeking quality care who find the right fit will often prioritize value over price
• Implement a limited sliding scale with clear parameters if you want to serve clients with financial limitations
• Pay yourself consistently as a business owner with a regular salary, not just compensation for client sessions
• Use multiple bank accounts (Profit First system) to ensure stable personal income regardless of business fluctuations
• Before hiring, understand your profit margins and ensure you can sustainably afford additional staff
• Start with administrative support before hiring clinicians to free up your time for revenue-generating activities
• Test your hiring readiness by setting aside potential employee salary for several months
• Consider the pros and cons of W-2 employees versus contractors based on your practice needs and tax implications
Send your questions for future mailbag episodes to info@craigdacy.com or submit them at therapybusinesspod.com.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
My name is Craig and I'm the owner of Daisy Financial
Coaching.
Our team is on a mission tomake your therapy practice
permanently profitable.
If you own a solo or grouppractice, we're here to help you
build a business that createsmore time, makes more money and
serves more people.
This is the Therapy BusinessPodcast.
These mailbag episodes are someof my favorites, because I know
(00:27):
how lonely it can be as abusiness owner.
A lot of us are therapists bytrade and business owner just
because that's what we fell intoand we're trying to navigate
this thing and figure it out.
I was in those shoes myselfalmost a decade ago, when I left
education to start thiscoaching business, I knew I was
passionate about helping peoplewith their finances.
I had never run a business thatI was relying on for my sole
(00:49):
income.
I had been a serialentrepreneur in the sense and I
put entrepreneur very loosely inthe sense of.
You know, I had been a musician.
I'd run a music business.
I toured for multiple years inmy twenties.
I had always had side hustles.
I was always finding other waysto earn incomes and managing
the finances and all those areas, but never had I been dependent
(01:10):
on those incomes to live mylife, and so I was figuring it
out as I go, and I needed peoplewho had been there before me to
lean on.
And now here I am.
I love running a business andI've become so passionate about
it that I'm now teaching othershow to do it as well, largely
because I'm still figuring itout as I go, as I hit new
thresholds in my business.
I'm still learning and adapting, because I'm in the trenches
(01:33):
with you, and that's why thesequestions, I think, are so
valuable when you send them tome, that we are working through
this together, because, likely,when you send a question in,
you're not the only persondealing with it, frustrated with
it, worried about it.
All right, let's talk aboutthese questions.
So the first one I'm going todig into is setting your fees
without scaring people off.
(01:54):
This is really challenging forpeople is setting a fee that is
valuing them their expertise andmaking sure it meets with all
your needs, but also we'reafraid that nobody's going to
want to pay it, that people aregoing to be too afraid to pay it
, and so what often happens whenI see therapists fees is they
are drastically undervaluingthemselves and undercharging.
(02:17):
This can lead to a lot ofproblems because it's really
hard to scale when you're notcharging a lot.
We are in this industry oftherapy where it's one-on-one or
, if you're in physical therapy,it's typically a one-on-one
engagement.
You are capped at how manypatients or clients you can work
with.
You only have so many hours inthe day, and so at some point
(02:38):
you are going to hit a ceilingof what you can do.
Now this can lead into hiring,growing your team, but also at
the same time, if you're notcharging enough, that makes it
really hard because you don'thave a lot of overhead to make
those hires.
You're suddenly hitting thisceiling of what can I afford to
do and you don't have the cashto expand, and so setting our
(03:00):
fees is really really importantand really delicate.
So I always say the first thingyou should do is start with what
do you need to be making?
What do you need to make?
How many clients do youspecifically want to work with,
or can you work with, withoutreaching that point of burnout?
Early on, you might be workingwith more people, and so
whatever number you come up with, it doesn't have to be your
forever.
(03:20):
If you're saying I want to meetwith 20 to 30 clients a week.
That doesn't have to be whereyou are forever.
Maybe, as you expand and growyour team, you can bring that
back.
But right now, if you're lookingat 20 to 30, look at how much
you want to be taking home everymonth.
What's that number?
And then work backwards.
If I need X dollars every month, and here's how many sessions I
can realistically handle everyweek, what does that look like
(03:44):
per session?
So take those numbers, figureout.
How much should I be chargingper session in order to make
that happen?
So if we are looking at let'sjust say, you're charging a
hundred dollars per session andyou're seeing 20 people a week,
right, that's $2,000 a week.
That's about $8,000 a month.
Can you live on that?
(04:05):
Does that work for you?
If not, then we need to makesome changes.
If it works, awesome, then keepit there.
But also you start to run intothat ceiling.
You're like I would rather beseeing 10 to 15, but I need to
be making 10,000 a month.
So this is where you can see wemight need to adjust our rates.
What can we afford to charge tomake sure it's covered?
That's piece number one.
(04:25):
Number two is we got to know inour business what does our
overhead look like?
What is taxes?
What is our operating expenses?
Do we have a office space thatwe pay rent on?
Do we have a team?
Do we have an admin?
All of these things come intoplay and we have to have again
profit margin in order to coverthis.
So if we don't have enough cashon top of what we are once we
(04:46):
have covered all those expenses,that's where a business can run
into trouble.
When we are worried aboutscaring people off is where we
start to run into issues is weare afraid that people are not
going to want to pay us, thatwe're going to quote them and
tell them our rate and they'regoing to run for the hills.
And I'm going to be honest, somepeople will.
Some people are bargainshoppers.
(05:06):
Some people are looking for thecheapest therapist they can
find.
Now, a lot of them it'scircumstances.
They just can't afford to pay apremium.
They can't afford to pay two to$300 per session.
That's just where they are.
Some of them maybe can affordit, but they just don't want to
afford it.
They're looking for who isgoing to be the cheapest, most
affordable person and,truthfully, those are probably
(05:29):
not going to be your idealclients.
Anyway, it really boils down towho do I want to work with.
If you really want to work withsomebody who's going to engage,
who is seeking out the bestquality of care they're looking
for the right therapist, theright person for them then money
most often is not going toreally be a deterrent.
(05:49):
If they find someone who is theright fit, who they feel secure
with, who they feel reallyconfident can help them, then
they're going to find a way tomake that fee work.
Now you can always introduce asliding scale if you want to
make a variable price range.
So maybe you have a way thatyou can serve some people who
would be a great fit.
They just economically don'thave the bandwidth to afford
(06:11):
your fee.
Then maybe you can create spaceto hold three to five clients
in your back pocket that you cangive a reduced rate to.
I would just be very cautiousabout capping that.
What are the circumstancesbefore you even get in there?
What does it look like?
Who would qualify for?
Very cautious about cappingthat.
What are the circumstancesbefore you even get in there?
What does it look like?
Who would qualify for it?
What is the cap?
How many of these can I take on.
And if you've reached that, soif you're saying I can do five
(06:34):
people at a reduced rate of,let's just say, 50%, so of half.
So instead of 200, we'recharging them 100.
I can do five people.
Once you hit those five, ifother people are coming to you
at that point, you can eitherwait, list them for the reduced
rate, or you can refer them out,or you can tell them the rate
is 200 and that's what it is,and they can take it or leave it
(06:55):
.
I always revert back to when itcomes to scaring people off.
You can serve clients withouttaking them as a client.
You can serve people withouttaking them as a client.
Some people just aren't goingto be the right fit and there's
a lot of factors that come intoplay.
And it's okay if finances isone of those factors.
Now, that has to be a piece.
(07:16):
You are a business, you have alivelihood.
What often happens istherapists reach burnout if they
don't price their pricesaccordingly.
So it's really important to goabout it that way, to remember
that it doesn't have to be theend, all be all.
That's not the only factorwe're looking for, but also it's
an important one.
And then, lastly, if you havecertain designations,
(07:37):
qualifications, specialties,things that you primarily focus
on, these can help drive up whatyou can charge and, again, will
make you more appealing topeople and more willing to find
a way to afford those rates, ifthey can.
All right.
Next let's talk about how to payyourself consistently as a
business owner.
This is, truthfully, the mostcommon challenge that we see
(08:01):
when people come to us.
It's like how can I pay myselfa consistent paycheck?
How can I make sure that mybills are covering the business
and that I'm taking home thesame amount every single time?
What often happens is westumble into this business thing
, just like I alluded to at thebeginning.
We are your therapist and younow find yourself running this
therapy business and previouslymaybe you were working with
(08:22):
another practice.
You were one of the therapistson their team and they paid you
a regular paycheck based on howmany clients you saw.
You got paid every other weekor every month or whatever that
rhythm is.
Then we get into our ownbusiness and what we often find
is we are not paying ourselvesthat way.
We are not paying ourselvesthat way.
We're not paying ourselves on aconsistent basis.
It's, I see, a lot where we'redipping into the business to
(08:44):
cover our expenses.
It's I hope I got a bill due.
I'm going to pull money out ofthe business.
Oops, I need my bank accountsgetting low.
I'm going to pull some moremoney out of the business.
What we need to be is on aconsistent paycheck rhythm.
Here's the other piece is ifyou're paying yourself based on
the clients you see, you're notpaying yourself as a business
owner, you're paying yourself asa therapist, as an employee.
(09:06):
Essentially, I'm a firmbeliever that, as the business
owner, you should be on a salary.
Now, if you want to get paidfor the clients you see, plus a
flat rate salary or stipend,that's great.
But you need something to bepaying you for the marketing and
for the managing the systemsand processes and managing the
team members and managing all ofthe things that come with being
(09:27):
a business owner.
Simply paying yourself 50, 60%of client session fees?
You're just a therapist and youhappen to work for yourself.
We wanna move into thatbusiness owner mentality.
So I'm a huge fan of makingyourself on salary, getting
yourself a very consistentpaycheck.
Here's what I get paid everysingle time, the same amount on
the same rhythm, so that wayyou're not worried about if I go
(09:50):
on a vacation, if I'm off for aweek, if whatever.
You know, here in Texas a coupleof years ago we had what we
call snowpocalypse, because wewere not well handled for snow
and ice, so it shut the wholetown down for like three days
and so therapists here weren'table to see clients if,
especially because power andelectricity was all down too so
you couldn't even do telehealth.
It was a mess.
(10:11):
If that happens and you're seton a regular pay schedule,
you're going to get paid thesame amount.
You're not going to take a payhit just because those days off,
and that can help with thatstress and anxiety.
We are big believers in usingmultiple bank accounts.
We allude to it a lot and weeven have a whole episode on
what we, where we teach theprofit first system.
It's episode number two, Ibelieve, if you go all the way
(10:31):
back to the beginning, where wetalk about how to set up
multiple bank accounts to makesure that you're always paid on
time consistently.
So I would go find that episode, listen to it.
It's really helpful.
All right, last question fortoday's mailbag is how do I know
if I can afford to hire orexpand.
So this is for my, my solotherapists, who are maybe you're
(10:54):
reaching that cap, that burnoutpoint we were talking about.
You're running out of hours andyou're going.
I'm either this is notsustainable because I've
overloaded my caseload, oryou're just going.
I want to continue to grow andI'm starting to hit that ceiling
of what I can afford to do.
So how do I know if I can affordto hire?
So first of all, we need toknow our numbers.
So we have to know what is ourprofitability right now?
(11:16):
What are our expenses?
What are we bringing in?
What are our expenses?
What are we paying ourselves?
What are we setting aside fortaxes?
All of those thingsno-transcript, no-transcript.
(12:02):
Open up a bank account,nickname it new employee and
start setting money in there.
Pretend like you're paying themalready.
That's one way to find out ifyou can afford a new employee is
to start paying them on paperbut putting that money into an
account to save up usually threeto six months of expenses, but
having enough to, I would say,three to four payroll cycles,
(12:23):
that you have a cash cushion,especially if there's going to
be some training and some runwayyou're going to need before
they're going to startgenerating an ROI.
We want to have a little bit ofa cash cushion to help with
those growing pains of bringingthat new employee on Now.
Knowing what kind of employeeyou want is really important as
well.
So are we going to start with,again, the admin or the coach?
(12:44):
Typically, it's best to go witha virtual assistant or an admin
of some kind.
They're going to be able totake a lot of stuff off your
plate.
They're going to be able toease into the job and it's a
great way to kind of test thewaters of that employment.
So you can still see it freesyou up to either maybe see more
clients or to focus your energyon marketing or growing leads,
so that you will be more readyto hire a clinician to work
(13:08):
under you.
So a VA is going to be able tooffload all of those tasks that
you are filling your day withthat you shouldn't probably be
doing in the first place.
So there's a lot of admin tasks, background tasks that you can
offload to them.
Free up your time to focus ongrowth, expansion or working
with more clients.
They can also help withretention.
(13:30):
What we often find is maybe youare getting a lot of leads.
You're just not following upwith them because you don't have
time, and what we find in salesis that it takes seven to 12
touch points before a salehappens.
So somebody reaches out to youon your website they want help.
Maybe you email them respondinghey yeah, let's connect and
talk, let's set up a freeconsultation.
And then they never do and younever follow up, not because
(13:53):
you're lazy, but probably justbecause it just doesn't happen.
You get busy, things happen andthey fall between the cracks.
An admin can help with this.
You can set them up, give thema process where they are
following up with leads.
They are calling them regularlythat's seven to 12 times right
To get them on a schedule andthen they get added to a
database where they're checkingin with them every couple months
(14:13):
.
So prospecting is what we wouldcall that where they're
reaching out to a list of old orcurrent leads and just tapping
their shoulder trying to makesure they're getting help.
This will help grow yourpractice tremendously.
So once that process getsmoving, that admin can actually
help generate revenue for youwithout ever seeing clients.
Then, from there, you'relooking at hiring a clinician.
(14:34):
Now there's a lot of differentways to pay clinicians.
We have full episodes on thedifferent pay structures you can
use and there's pros and consfor each one.
I believe it's called PayStructures 101.
Go back through and you canfind that episode it's really
really helpful to look at.
Is commission-based, isfee-based, is salary-based?
Which one is the best way to go?
(14:54):
They all depend, but a lot oftimes for somebody who's trying
to make their first hire,commission-based can be a great
way to do it.
Or a flat fee, meaning whenthey meet with a client they get
paid for that client sessiondirectly, so they're not making
money if they're not seeingclients.
They're making money if theyare, and so that way it's a
(15:17):
lower risk on you.
If you're just paying them, youknow 50 to 60% of what that
client session fee is.
This is where having yourprices marked higher and going
back to that, setting your feesin a way that's scalable, that
makes sure that all your basesare covered, is really important
so that as you pay yourclinician, you still have enough
cash to help offset some ofthose other costs like payroll,
the payroll fees, the payrolltax, any other overhead costs
(15:40):
you might have, adding a simplepractice or whatever softwares
you have to add for them.
So there's a lot of otherfactors that come into play that
we want to take intoconsideration.
The last thing we need to thinkabout is do you want to go with
W-2 contractor?
Which one makes the most senseat this juncture in your
business?
Again, each one has its prosand cons and also there's going
to be some gray area that youneed to make sure that you are
(16:01):
abiding by.
Contractors, in theory, aretheir own business.
They are their own business.
They are not part of yourcompany directly and so, as
you're giving them clients,you're limited on what you can
dictate, what you can require ofthem, of how they do things,
because you're sending businessout to their business on paper.
(16:21):
So there's pros and cons.
However, contractors arecheaper in the tax side, so W-2
is going to come along withpayroll tax, unemployment tax,
all those things come into play.
So there's just a lot of thosefactors.
Whereas a contractor, they'regoing to be in charge of their
own simple practice account,their own softwares, all their
expenses are on them, whereas aW-2 employee, that's going to
fall on you.
(16:42):
So these are all pieces we needto be thinking about as we go
about it.
So I always recommend take yourtime.
I once had a coach tell me tostart hiring before you're ready
to hire.
Meaning start this processDoesn't mean go out hire
somebody to start tomorrow ifyou're not ready for them, but
(17:02):
it means start figuring thisstuff out what can I afford?
Start saving for it and thenalso start interviewing.
Take your time interviewing.
You want to find the right fit,the person who is the right fit
for you, for your clients, sothat when you are ready to hire
you can do it confidently.
All right, these mailbagepisodes, like I said, they're
some of my favorites to do.
So please send your questionsto me.
Go to therapybusinesspodcom.
(17:22):
You can submit questions to mevia email.
Info at craigdaceycom.
You can send me an emaildirectly if you like.
I'm happy to answer yourquestion on a future mailbag
episode.
Otherwise, y'all good luck.
Let me know how I can bestserve you and we'll see you in
the next episode.
Thanks for joining us on theTherapy Business Podcast.
Be sure to subscribe, leave areview and share it with a
(17:43):
practice owner that you may knowIf your practice needs help
getting organized with itsfinances or just growing your
practice.
Head to therapybusinesspodcomto learn how we can help.
My name is Craig and I'm the owner of Daisy Financial
Coaching.
Our team is on a mission tomake your therapy practice
permanently profitable.
If you own a solo or grouppractice, we're here to help you
build a business that createsmore time, makes more money and
serves more people.
This is the Therapy BusinessPodcast.
These mailbag episodes are someof my favorites, because I know
(00:27):
how lonely it can be as abusiness owner.
A lot of us are therapists bytrade and business owner just
because that's what we fell intoand we're trying to navigate
this thing and figure it out.
I was in those shoes myselfalmost a decade ago, when I left
education to start thiscoaching business, I knew I was
passionate about helping peoplewith their finances.
I had never run a business thatI was relying on for my sole
(00:49):
income.
I had been a serialentrepreneur in the sense and I
put entrepreneur very loosely inthe sense of.
You know, I had been a musician.
I'd run a music business.
I toured for multiple years inmy twenties.
I had always had side hustles.
I was always finding other waysto earn incomes and managing
the finances and all those areas, but never had I been dependent
(01:10):
on those incomes to live mylife, and so I was figuring it
out as I go, and I needed peoplewho had been there before me to
lean on.
And now here I am.
I love running a business andI've become so passionate about
it that I'm now teaching othershow to do it as well, largely
because I'm still figuring itout as I go, as I hit new
thresholds in my business.
I'm still learning and adapting, because I'm in the trenches
(01:33):
with you, and that's why thesequestions, I think, are so
valuable when you send them tome, that we are working through
this together, because, likely,when you send a question in,
you're not the only persondealing with it, frustrated with
it, worried about it.
All right, let's talk aboutthese questions.
So the first one I'm going todig into is setting your fees
without scaring people off.
(01:54):
This is really challenging forpeople is setting a fee that is
valuing them their expertise andmaking sure it meets with all
your needs, but also we'reafraid that nobody's going to
want to pay it, that people aregoing to be too afraid to pay it
, and so what often happens whenI see therapists fees is they
are drastically undervaluingthemselves and undercharging.
(02:17):
This can lead to a lot ofproblems because it's really
hard to scale when you're notcharging a lot.
We are in this industry oftherapy where it's one-on-one or
, if you're in physical therapy,it's typically a one-on-one
engagement.
You are capped at how manypatients or clients you can work
with.
You only have so many hours inthe day, and so at some point
(02:38):
you are going to hit a ceilingof what you can do.
Now this can lead into hiring,growing your team, but also at
the same time, if you're notcharging enough, that makes it
really hard because you don'thave a lot of overhead to make
those hires.
You're suddenly hitting thisceiling of what can I afford to
do and you don't have the cashto expand, and so setting our
(03:00):
fees is really really importantand really delicate.
So I always say the first thingyou should do is start with what
do you need to be making?
What do you need to make?
How many clients do youspecifically want to work with,
or can you work with, withoutreaching that point of burnout?
Early on, you might be workingwith more people, and so
whatever number you come up with, it doesn't have to be your
forever.
(03:20):
If you're saying I want to meetwith 20 to 30 clients a week.
That doesn't have to be whereyou are forever.
Maybe, as you expand and growyour team, you can bring that
back.
But right now, if you're lookingat 20 to 30, look at how much
you want to be taking home everymonth.
What's that number?
And then work backwards.
If I need X dollars every month, and here's how many sessions I
can realistically handle everyweek, what does that look like
(03:44):
per session?
So take those numbers, figureout.
How much should I be chargingper session in order to make
that happen?
So if we are looking at let'sjust say, you're charging a
hundred dollars per session andyou're seeing 20 people a week,
right, that's $2,000 a week.
That's about $8,000 a month.
Can you live on that?
(04:05):
Does that work for you?
If not, then we need to makesome changes.
If it works, awesome, then keepit there.
But also you start to run intothat ceiling.
You're like I would rather beseeing 10 to 15, but I need to
be making 10,000 a month.
So this is where you can see wemight need to adjust our rates.
What can we afford to charge tomake sure it's covered?
That's piece number one.
(04:25):
Number two is we got to know inour business what does our
overhead look like?
What is taxes?
What is our operating expenses?
Do we have a office space thatwe pay rent on?
Do we have a team?
Do we have an admin?
All of these things come intoplay and we have to have again
profit margin in order to coverthis.
So if we don't have enough cashon top of what we are once we
(04:46):
have covered all those expenses,that's where a business can run
into trouble.
When we are worried aboutscaring people off is where we
start to run into issues is weare afraid that people are not
going to want to pay us, thatwe're going to quote them and
tell them our rate and they'regoing to run for the hills.
And I'm going to be honest, somepeople will.
Some people are bargainshoppers.
(05:06):
Some people are looking for thecheapest therapist they can
find.
Now, a lot of them it'scircumstances.
They just can't afford to pay apremium.
They can't afford to pay two to$300 per session.
That's just where they are.
Some of them maybe can affordit, but they just don't want to
afford it.
They're looking for who isgoing to be the cheapest, most
affordable person and,truthfully, those are probably
(05:29):
not going to be your idealclients.
Anyway, it really boils down towho do I want to work with.
If you really want to work withsomebody who's going to engage,
who is seeking out the bestquality of care they're looking
for the right therapist, theright person for them then money
most often is not going toreally be a deterrent.
(05:49):
If they find someone who is theright fit, who they feel secure
with, who they feel reallyconfident can help them, then
they're going to find a way tomake that fee work.
Now you can always introduce asliding scale if you want to
make a variable price range.
So maybe you have a way thatyou can serve some people who
would be a great fit.
They just economically don'thave the bandwidth to afford
(06:11):
your fee.
Then maybe you can create spaceto hold three to five clients
in your back pocket that you cangive a reduced rate to.
I would just be very cautiousabout capping that.
What are the circumstancesbefore you even get in there?
What does it look like?
Who would qualify for?
Very cautious about cappingthat.
What are the circumstancesbefore you even get in there?
What does it look like?
Who would qualify for it?
What is the cap?
How many of these can I take on.
And if you've reached that, soif you're saying I can do five
(06:34):
people at a reduced rate of,let's just say, 50%, so of half.
So instead of 200, we'recharging them 100.
I can do five people.
Once you hit those five, ifother people are coming to you
at that point, you can eitherwait, list them for the reduced
rate, or you can refer them out,or you can tell them the rate
is 200 and that's what it is,and they can take it or leave it
(06:55):
.
I always revert back to when itcomes to scaring people off.
You can serve clients withouttaking them as a client.
You can serve people withouttaking them as a client.
Some people just aren't goingto be the right fit and there's
a lot of factors that come intoplay.
And it's okay if finances isone of those factors.
Now, that has to be a piece.
(07:16):
You are a business, you have alivelihood.
What often happens istherapists reach burnout if they
don't price their pricesaccordingly.
So it's really important to goabout it that way, to remember
that it doesn't have to be theend, all be all.
That's not the only factorwe're looking for, but also it's
an important one.
And then, lastly, if you havecertain designations,
(07:37):
qualifications, specialties,things that you primarily focus
on, these can help drive up whatyou can charge and, again, will
make you more appealing topeople and more willing to find
a way to afford those rates, ifthey can.
All right.
Next let's talk about how to payyourself consistently as a
business owner.
This is, truthfully, the mostcommon challenge that we see
(08:01):
when people come to us.
It's like how can I pay myselfa consistent paycheck?
How can I make sure that mybills are covering the business
and that I'm taking home thesame amount every single time?
What often happens is westumble into this business thing
, just like I alluded to at thebeginning.
We are your therapist and younow find yourself running this
therapy business and previouslymaybe you were working with
(08:22):
another practice.
You were one of the therapistson their team and they paid you
a regular paycheck based on howmany clients you saw.
You got paid every other weekor every month or whatever that
rhythm is.
Then we get into our ownbusiness and what we often find
is we are not paying ourselvesthat way.
We are not paying ourselvesthat way.
We're not paying ourselves on aconsistent basis.
It's, I see, a lot where we'redipping into the business to
(08:44):
cover our expenses.
It's I hope I got a bill due.
I'm going to pull money out ofthe business.
Oops, I need my bank accountsgetting low.
I'm going to pull some moremoney out of the business.
What we need to be is on aconsistent paycheck rhythm.
Here's the other piece is ifyou're paying yourself based on
the clients you see, you're notpaying yourself as a business
owner, you're paying yourself asa therapist, as an employee.
(09:06):
Essentially, I'm a firmbeliever that, as the business
owner, you should be on a salary.
Now, if you want to get paidfor the clients you see, plus a
flat rate salary or stipend,that's great.
But you need something to bepaying you for the marketing and
for the managing the systemsand processes and managing the
team members and managing all ofthe things that come with being
(09:27):
a business owner.
Simply paying yourself 50, 60%of client session fees?
You're just a therapist and youhappen to work for yourself.
We wanna move into thatbusiness owner mentality.
So I'm a huge fan of makingyourself on salary, getting
yourself a very consistentpaycheck.
Here's what I get paid everysingle time, the same amount on
the same rhythm, so that wayyou're not worried about if I go
(09:50):
on a vacation, if I'm off for aweek, if whatever.
You know, here in Texas a coupleof years ago we had what we
call snowpocalypse, because wewere not well handled for snow
and ice, so it shut the wholetown down for like three days
and so therapists here weren'table to see clients if,
especially because power andelectricity was all down too so
you couldn't even do telehealth.
It was a mess.
(10:11):
If that happens and you're seton a regular pay schedule,
you're going to get paid thesame amount.
You're not going to take a payhit just because those days off,
and that can help with thatstress and anxiety.
We are big believers in usingmultiple bank accounts.
We allude to it a lot and weeven have a whole episode on
what we, where we teach theprofit first system.
It's episode number two, Ibelieve, if you go all the way
(10:31):
back to the beginning, where wetalk about how to set up
multiple bank accounts to makesure that you're always paid on
time consistently.
So I would go find that episode, listen to it.
It's really helpful.
All right, last question fortoday's mailbag is how do I know
if I can afford to hire orexpand.
So this is for my, my solotherapists, who are maybe you're
(10:54):
reaching that cap, that burnoutpoint we were talking about.
You're running out of hours andyou're going.
I'm either this is notsustainable because I've
overloaded my caseload, oryou're just going.
I want to continue to grow andI'm starting to hit that ceiling
of what I can afford to do.
So how do I know if I can affordto hire?
So first of all, we need toknow our numbers.
So we have to know what is ourprofitability right now?
(11:16):
What are our expenses?
What are we bringing in?
What are our expenses?
What are we paying ourselves?
What are we setting aside fortaxes?
All of those thingsno-transcript, no-transcript.
(12:02):
Open up a bank account,nickname it new employee and
start setting money in there.
Pretend like you're paying themalready.
That's one way to find out ifyou can afford a new employee is
to start paying them on paperbut putting that money into an
account to save up usually threeto six months of expenses, but
having enough to, I would say,three to four payroll cycles,
(12:23):
that you have a cash cushion,especially if there's going to
be some training and some runwayyou're going to need before
they're going to startgenerating an ROI.
We want to have a little bit ofa cash cushion to help with
those growing pains of bringingthat new employee on Now.
Knowing what kind of employeeyou want is really important as
well.
So are we going to start with,again, the admin or the coach?
(12:44):
Typically, it's best to go witha virtual assistant or an admin
of some kind.
They're going to be able totake a lot of stuff off your
plate.
They're going to be able toease into the job and it's a
great way to kind of test thewaters of that employment.
So you can still see it freesyou up to either maybe see more
clients or to focus your energyon marketing or growing leads,
so that you will be more readyto hire a clinician to work
(13:08):
under you.
So a VA is going to be able tooffload all of those tasks that
you are filling your day withthat you shouldn't probably be
doing in the first place.
So there's a lot of admin tasks, background tasks that you can
offload to them.
Free up your time to focus ongrowth, expansion or working
with more clients.
They can also help withretention.
(13:30):
What we often find is maybe youare getting a lot of leads.
You're just not following upwith them because you don't have
time, and what we find in salesis that it takes seven to 12
touch points before a salehappens.
So somebody reaches out to youon your website they want help.
Maybe you email them respondinghey yeah, let's connect and
talk, let's set up a freeconsultation.
And then they never do and younever follow up, not because
(13:53):
you're lazy, but probably justbecause it just doesn't happen.
You get busy, things happen andthey fall between the cracks.
An admin can help with this.
You can set them up, give thema process where they are
following up with leads.
They are calling them regularlythat's seven to 12 times right
To get them on a schedule andthen they get added to a
database where they're checkingin with them every couple months
(14:13):
.
So prospecting is what we wouldcall that where they're
reaching out to a list of old orcurrent leads and just tapping
their shoulder trying to makesure they're getting help.
This will help grow yourpractice tremendously.
So once that process getsmoving, that admin can actually
help generate revenue for youwithout ever seeing clients.
Then, from there, you'relooking at hiring a clinician.
(14:34):
Now there's a lot of differentways to pay clinicians.
We have full episodes on thedifferent pay structures you can
use and there's pros and consfor each one.
I believe it's called PayStructures 101.
Go back through and you canfind that episode it's really
really helpful to look at.
Is commission-based, isfee-based, is salary-based?
Which one is the best way to go?
(14:54):
They all depend, but a lot oftimes for somebody who's trying
to make their first hire,commission-based can be a great
way to do it.
Or a flat fee, meaning whenthey meet with a client they get
paid for that client sessiondirectly, so they're not making
money if they're not seeingclients.
They're making money if theyare, and so that way it's a
(15:17):
lower risk on you.
If you're just paying them, youknow 50 to 60% of what that
client session fee is.
This is where having yourprices marked higher and going
back to that, setting your feesin a way that's scalable, that
makes sure that all your basesare covered, is really important
so that as you pay yourclinician, you still have enough
cash to help offset some ofthose other costs like payroll,
the payroll fees, the payrolltax, any other overhead costs
(15:40):
you might have, adding a simplepractice or whatever softwares
you have to add for them.
So there's a lot of otherfactors that come into play that
we want to take intoconsideration.
The last thing we need to thinkabout is do you want to go with
W-2 contractor?
Which one makes the most senseat this juncture in your
business?
Again, each one has its prosand cons and also there's going
to be some gray area that youneed to make sure that you are
(16:01):
abiding by.
Contractors, in theory, aretheir own business.
They are their own business.
They are not part of yourcompany directly and so, as
you're giving them clients,you're limited on what you can
dictate, what you can require ofthem, of how they do things,
because you're sending businessout to their business on paper.
(16:21):
So there's pros and cons.
However, contractors arecheaper in the tax side, so W-2
is going to come along withpayroll tax, unemployment tax,
all those things come into play.
So there's just a lot of thosefactors.
Whereas a contractor, they'regoing to be in charge of their
own simple practice account,their own softwares, all their
expenses are on them, whereas aW-2 employee, that's going to
fall on you.
(16:42):
So these are all pieces we needto be thinking about as we go
about it.
So I always recommend take yourtime.
I once had a coach tell me tostart hiring before you're ready
to hire.
Meaning start this processDoesn't mean go out hire
somebody to start tomorrow ifyou're not ready for them, but
(17:02):
it means start figuring thisstuff out what can I afford?
Start saving for it and thenalso start interviewing.
Take your time interviewing.
You want to find the right fit,the person who is the right fit
for you, for your clients, sothat when you are ready to hire
you can do it confidently.
All right, these mailbagepisodes, like I said, they're
some of my favorites to do.
So please send your questionsto me.
Go to therapybusinesspodcom.
(17:22):
You can submit questions to mevia email.
Info at craigdaceycom.
You can send me an emaildirectly if you like.
I'm happy to answer yourquestion on a future mailbag
episode.
Otherwise, y'all good luck.
Let me know how I can bestserve you and we'll see you in
the next episode.
Thanks for joining us on theTherapy Business Podcast.
Be sure to subscribe, leave areview and share it with a
(17:43):
practice owner that you may knowIf your practice needs help
getting organized with itsfinances or just growing your
practice.
Head to therapybusinesspodcomto learn how we can help.
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