214 - Profitable But Still Broke: Where Your Practice Cash Is Actually Going

So let's you know, when someone comes to you and they say, I'm making good money in my practice, but there's really not enough.

It always feels like there's not enough in my account.

Where do we kind of start with this conversation of being profitable but still broke? What's usually going on?

Yeah.

So what I've always found, step one is if someone has their books done or not.

So meaning, have they been maintaining their bookkeeping on a monthly basis? Yes.

So normally, and this is extremely normal, people just don't do their books until they have to do their taxes.

And when you do that, you find yourself having to kind of grapple with the decisions you made five or six months ago.

And having this spiral of what I could have done versus where I'm at now.

And so what I always recommend to... practitioners is outsource your books.

Do what you do best and let someone else do your books because accounting is not super intuitive.

I mean, other than the fact like don't spend more than you have.

Other than that, that's about as intuitive as it gets.

But bookkeeping is a lot more strategic in how you set up your chart of accounts, what the numbers mean, all of that.

I always recommend that to be the first thing they outsource.

So then you get good numbers so you can make good decisions because then that also leads into like the first kind of cash leak that I see almost everybody have and it's in their pricing.

Okay.

Yeah, I think that's really good advice.

And just I'm thinking through sort of my history and my business, like it probably took me a good six years before I got a bookkeeper.

And I'm ashamed to admit that.

Because once I did it, it was it was huge, because it really does.

It helps you have somebody number one, you know, setting up those categories for you know, how you for your expenses, and write offs and all that, but also to having somebody who 100%.

Yeah, I feel like that is, you know, awareness always helps with just making better choices in general.

And I think having someone do your books, have them get them to you by like the 10th or the 15th.

You then can make the decisions you need to change if, you know, you're going in the wrong trajectory.