Speaker 1: Welcome to the BiggerPockets Money Podcast, Finance Friday edition, where we speak with Amy and talk about entrepreneurship.
Guest: And for the last few years, I’ve really been wanting to start my own practice and, um, I was just doing a lot of research for years, kind of planning, and then finally I was like, okay, I’m going to do it.
Guest: So I have a specialty. I, uh, do pelvic health physical therapy, so it’s a little bit of a niche.
Scott: What would be your, your maximum potential revenue in a week?
Guest: 165.
Scott: So I’m going to average that out to 15. So we have, uh, 15 patients times $165 times four weeks in a month because this is February, brings you $10,000 in income.
Mindy: Hello, hello, hello. My name is Mindy Jensen and with me as always is my charming co-host, Scott Trench.
Scott: Thank you, Mindy. Today’s episode was very therapeutic.
Mindy: Scott and I are here to make financial independence less scary. Less just for somebody else. To introduce you to every money story because we truly believe financial freedom is attainable for everyone, no matter when or where you are starting.
Scott: That’s right. Whether you want to retire early and travel the world, go on to make big-time investments in assets like real estate, or start your own physical therapy business, we’ll help you reach your financial goals and get money out of the way so you can launch yourself towards your dreams.
Mindy: Scott, I called you charming in our introduction. You’re not the only charming trench that I have seen recently. I saw your charming wife Virginia and your adorably charming baby Katie. I am so excited to have met her in real life. Finally. And holy cow she’s tall.
Scott: Yeah, she’s a 95th percentile for length or height. I’m not sure which which is the the official term for infants there. But yeah, we have a great picture of uh, Aunt Mindy uh holding her. So, that was that was wonderful and her future future real estate investor onesie.
Mindy: Future real estate investor baby Katie. Yes, she is an absolute doll and she had some beautiful gummy smiles. So I’m very excited that you brought her in to see me, only me. Other people got to see her, but I got to hold her and she’s an adorable.
Scott: That was a wonderful moment. So, it’s great great for her to meet everybody and yeah, she’s doing, she’s a wonderful, happy, healthy baby. We’re very very, very lucky.
Mindy: Yes, you are very lucky because she is, she’s a good sleeper too, isn’t she?
Scott: She was.
Mindy: You just cursed you. Or jinxed you. I just jinxed you. She’ll become a good sleeper again. You know what the key is? Consistency and schedule and when she wakes up, stick her right back in the bed.
Scott: Mindy, how are your girls doing?
Mindy: Uh, they’re doing okay. Today, uh, everybody’s a little bit sick. Um, there’s some nasty bug going around, but they are doing well. Claire’s in high school now, which is shocking. I can’t believe I have a high schooler and Daphne’s in middle school.
Scott: Mindy gets on in pre-recording and she says, I’m really sick today. But at least my girls are sick too.
Mindy: Yeah, so it’s a great, it’s a great day all the way around.
Scott: I hope you feel better, Mindy.
Mindy: Thank you, Scott. Thank you, Scott. Thank you, Scott. I’m excited for today’s episode because we are talking to Amy. Amy runs her own physical therapy very specialized physical therapy business and we ended up focusing a lot on how she can improve her business. And I’m really excited to check back in with her in a few months and see what changes she has made to how she’s running her business. But before we bring her in, let’s talk about today’s money moment. We have a new segment of the show called the Money moment, where we share a money hack tip or trick to help you on your financial journey. Today’s money moment is, do you want to travel for cheaper, strategize the days that you’re booking. The cheapest days to travel are Tuesday, Wednesday and Saturday with the most expensive being Friday and Sunday, which makes sense if you think about it. You’re going away on a vacation, you’re going to leave on Friday and come back on Sunday. But if you can change the days that you’re leaving, you could say big bucks. Do you have a money moment for us, email us at moneymoment@biggerpockets.com. Before we bring in Amy, let’s take a quick break. And we’re back. Joining us today is Amy, who is married with one teenage son and recently started her own business. Things are starting off a little bit slow, but they have huge potential. But she feels like her spending is a little bit wild. So we’ll be focusing on that as well. Amy, welcome to the Bigger Pockets Money podcast. I’m so excited to talk to you today.
Guest: Thank you Mindy, I’m so excited to be here. And Scott, hi Scott.
Scott: Howdy.
Mindy: Let’s run through your numbers really quick. Amy, I show a salary of 5,400 with additional income of approximately 1,000 a month for your husband’s side hustle and 400 for your side hustle. I show debts of $9,700 of deferred student loans, but which will be around 7% when they come back to active. Two mortgage payments instead of PMI. So, that’s a really smart move, by the way. We’ll talk about that in a moment. Uh $245,000 at 2.8% interest. Yay. And or 2.875 and $21,000 at 4.875. Uh, expenses, mortgage is 1700, utilities around 333, gasoline 286, car maintenance $25, household 200, groceries 700, phone bill 125, restaurants 150, subscriptions 80, gym 75, clothing 200, gifts 210, entertainment 45, insurance is both life and car, 94, spending on child activities 100, pets 120, miscellaneous 150 for a grand total of $4,594. So it looks like there’s a bit of a delta between what’s coming in and what is being spent, which is awesome. We have investments of $26,000 in a 401k, $24,000 in Roth IRAs, $15,000 in your husband’s retirement account, and cash savings of about $10,000. So Amy, what can we talk to you about today? What can we help you out with?
Guest: Yeah, so, um, I’m mostly, I mean, I would love to be financially independent. I don’t feel like I, um, am am shooting for a really fast financial independent. I’m okay with going a little slower. One of my big things is that, um, I started my own business so I could spend more time with my son, just especially through COVID and everything. I felt like those years flew by, and now he’s 13 and I’m like, oh, I need to spend as much time with him as possible. So, um, I would like to find a nice balance of making sure me and my family are on the right track. Um, I want us to do well, but I also don’t feel like we need to be cranking super hard to get there.
Scott: And what what is what is your uhm business?
Guest: So, I’m a physical therapist and so I started my own practice about a year ago.
Scott: And you mentioned a salary of 5,400. is that pre-tax from your husband?
Guest: That is post tax. So that is, uh, that is after, oh gosh. That is.
Scott: That implies like a $65,000 salary.
Guest: Yes. So my husband actually, he makes $40,000. So he takes home, so I’m sorry, that’s not pre tax. He takes home about $2,000 a month and then the rest is me take home. So that is not, so yeah, that is after all the, you know, insurance and all that sort of stuff with health insurance and all that.
Scott: Okay, so the goal is kind of, uh, uh we’re fine with the slower path, but kind of figure out how to, how to, how to make this situation work with the, um, um, the, physical therapy business, your husband’s income, and accumulate and move towards fire while still, while not busting it at a, at a, uh, any hour work week.
Guest: Yeah, exactly. Yes. I want to be able to pick my son up from school and to be able to go to his activities, be able to take him to his Kung Fu classes, all that sort of stuff.
Scott: Awesome. Could we also hear about your husband’s side hustle?
Guest: Yes. So he, uh, he makes, uh, wooden jewelry. And so he sells at local growers markets and um, those sorts of things. And it’s seasonal. So, uh, it’s mostly active during the summer, and there’s some smaller, um, holiday markets and stuff like that. So, and that fluctuates. This last year it was quite low because there was a lot of family stuff going on, but usually it could be anywhere, so I averaged it out per month, and so it could be anywhere from like $10,000 to if he really cranks on it, he could probably get to closer to like 20,000.
Mindy: You said he sells that at local markets. Does he have an online presence? Has he started selling on Etsy or does he do anything like that?
Guest: So he has his own website, but he has a really hard time keeping up with it. But that is something he wants to do, is have like a stock of jewelry, um, that he can, he just kind of has a basic set and have that, you know, being able to manage inventory and stuff like that. So, he, uh, has not spent time on that more recently. Oh, and also he’s supposed to be getting a $15,000 raise, hopefully, in the next couple months.
Mindy: Okay, so when you say he has a hard time keeping up with his website, does that mean that orders are coming in too fast or that the website hasn’t been updated recently?
Guest: It hasn’t been updated. So every once in a while and he also has not been marketing it. So every once in a while he will get a couple orders and then um, he’ll kind of scrambled like, oh, I hope I have, you know, I hope I have those, uh, particular styles in stock. And then usually he makes it work, but he also isn’t marketing it that much, so a lot of people don’t know it exists.
Mindy: So that is the problem that I see with with the small crafters who aren’t on a larger site like Etsy is, I don’t know Bob’s jewelry.com exists, but I know that Etsy exists. And it can be very difficult to be found on Etsy, but it’s impossible to be found on Etsy if you’re not on Etsy. So, I think that he should explore the the selling market of Etsy. And of course, it’s always changing and it used to be better and whatever. Um, I don’t sell on Etsy because I am not creative like that. But that could be an opportunity to grow his business, um, just by being on a place where people are already looking for handcrafted items. Um, so that’s something to think about, something to explore. And just even having a presence there could be, you know, you never know what’s going to hit.
Guest: Yeah, that’s a really good point. Um, yeah, I’m not sure. I think he was thinking about Etsy for a while, but he just hasn’t done too much with it this last year. So, yeah, I’ll have to tell them about that.
Scott: Well, it sounds like he has great product and it’s in demand and I love Mindy’s suggestion of Etsy and I think um, you could also consider um, doing selling it on Amazon and selling and shipping it yourself.
Guest: Yeah, that’s a really good idea.
Scott: So let’s zoom back out for a second here. Where do you think are the areas that we should be diving into or or thinking through to help you? What what specific questions do you have for us?
Guest: So, I think raising our income is going to be a big part of this. Um, back whenever I was had a salary position, I we were much more comfortable and I felt like we were able to put quite a bit more away in our Roth IRA and our 401k. And so now, I I sometimes I look back because I didn’t do what you guys recommend where you say start off your own little side hustle and um, get that growing a little bit before you quit. I I just saved, we stock piled some money and then I was like, I’m going to go do it and then I quit and then started my own practice. So there was a big we’ve had a big dip in income and even now where we’re at now, I’m proud of even though it’s not, it’s not very good, I feel like, right now. But, um, so I, I kind of feel like everything kind of fell apart, like our spending, and so I feel like we’re scrambling getting our budget in line, getting our income up and finding a path forward of what to do next cuz I’m ready to not, I’m ready to work on the next thing.
Scott: Well, the thing the thing that stands out here from what you just said and, you know, I I wonder if you guys are feeling very uncomfortable because the base salary for your husband is 40,000 and your spending is 4600 a month. So a that means that you have to have these variable income streams covering that and it averages out and looks good, but that can create some some problems there. And one thing that I’ll I’ll note on your budget is, I, you know, yes, we can go line by line and think through some items, like maybe there’s some percentage to shave off on your groceries, maybe there’s some things to do on the phone bill, um, maybe there’s some other things in clothing or whatever that you could, you could cut back, but this is not a outrageous budget. You’re not doing anything unreasonable here. Um, it seems very, very, you know, in line with what you’d expect for a three-person household. Um, on on the, um, uh, on the income front, let’s go through those, I I think the goal in the next year should be, how do you consistently get to a place where you are easily covering these expenses plus, let’s call it a $1000 buffer because you don’t have things in there for the car, uh, you know, you have $25 for car maintenance. No, the capex in your life is gonna be more than that and I think that’s also a factor here that we we have to acknowledge and be cognizant of, I think. So I I think we should go through these income sources one by one, um, and and think through some items. We already talked a little bit about your husband’s woodworking uh side hustle. What is his job?
Guest: So, he he has a a position at a uh local university here and it is a, um, he helps run what’s called a Maker space. So they have different machines to help, uh, where makers come and can make different things, like 3-D printers, laser printers, those sorts of things. And it was after COVID started, it, uh, you know, we just got super slammed. We were, the hospital system took away some of our benefits and are started pushing productivity a lot more. So, uh, I, you know, we were just working a lot. And for the last few years, I’ve really been wanting to start my own practice and, um, I was just doing a lot of research for years, kind of planning, and then finally I was like, okay, I’m going to do it. And, uh, in March, last year. So around August, gosh, I think it was August 2021, I I stopped contributing to retirement and just started saving money in our saving’s account. And then, um, put my notice in. I did say on PRN, which is that little bit of money I’m getting through my PRN job, um, at the hospital system, but I quit and then just started renting a room and seeing patients out of that room.
Mindy: So, how are you getting clients now?
Guest: So right now, I’m I’m getting, it’s a mixture. So I’m getting clients based off of my Google, my business, so people are finding me online. And, um, I, oh, so I have a specialty. I, uh, do pelvic health physical therapy, so it’s a little bit of a niche, and, um, I’m, so that is, kind of nice. I’m not just doing, you know, regular ortho PT. So, uh, I’m getting quite a bit of patients from a birthing center and also from, um, some other chiropractors, acupuncturists that I’ve just built connections with. Most of my people are coming for me like Googling pelvic floor PT near me. And then, um, I also am finally starting to get some more word of mouth people. So, you know, people being like, oh, I went and saw Amy’s and she helped me after I had my baby or, um, after my hysterectomy, uh, Amy helped me. And so, I’m finally getting more of those, which is really good. So, it’s a little bit of a few different places.
Mindy: Is that the only thing you do, is that super specialized? Or do you do a variety of physical therapy?
Guest: Yeah. So, I market pelvic health, so I mostly, but I like will see someone if they have, you know, a neck problem or a back problem. Like one of my patients, I’m seeing her dad for his shoulder. So, uh, I do accept other people. Unless I feel like they would be better going to someone else.
Mindy: Okay. I wonder if there’s an opportunity for, um, I’m I’m assuming you have a website yourself as well.
Guest: Yeah.
Mindy: Um, I’m wondering if there’s an opportunity for like networking with other PTs so that they know that you’re out there, so that when somebody comes to them with this issue, and also with um, obese and I mean it kind of with obese and birth centers and like the whole birth Doulas, you know, connecting with doulas and midwives and everybody in the birthing process. Hey, just wanted to let you know, I do this. Here’s a, do you have a brochure? Do people hand out brochures anymore?
Guest: Yeah, I have brochures still. Sometimes it’s, I usually try to have my cards, my brochures with me and like spread the word, you know.
Mindy: Because it seems like a a little bit of outreach like that could yield so much back because it’s a specialized thing. I would imagine that you don’t have a lot of competition.
Guest: There are, so there are in my area, there are some other pelvic floor PTs in my area. And so, um, but there’s not that many of us, you know. It is quite a huge need. A lot of people don’t even know it exists. And so, um, but I think it’s starting to become a more of something more common that people know about, that they’re looking for.
Mindy: On your website, do you educate people for why they would need this. Not only do people not know what this is, I can imagine. I mean, there’s a lot of women who don’t even know like all the things their body does and don’t know about the birthing process and like that there could be an opportunity for this afterwards, you know, writing blog posts about this what you can do for people could be really, like an educational piece on your website, YouTube videos, just talking into a camera, this is why you need physical therapy or hey, are you having these symptoms. Um, just getting the word out there that that this is a thing and that you can help them.
Guest: Yes. That is also, that’s always the challenge of telling people that there’s help for what they’re dealing with. And so, um, typically on my website, I’m like, if you’re experiencing, um, uh, urinary incontinence, pelvic pain, um, prolapse, you know, any, I, I’m usually I’m just listing all those things out, and then in another part of my website, I say I treat these conditions. Um, it is hard though to get. I’ve I’ve started, one of my goals this year is to do more workshops, so I’ve been contacting, um, yogurt studios, those sorts of things, seeing if I could get in there, see if I could get in front of their clients to host workshops. It’s a little harder than I thought, and I’m also a little introverted, so it’s definitely this year I’m like, I need to get out there in front of more people more. Um, and then I’ve been working, I think the YouTube videos are a good idea because I think that also helps with my website SEO, is having them connect back to my website.
Scott: Yep. Any sort of social media presence, Instagram, Facebook ads, um, just getting the the word out there that this the the symptoms that you’re experiencing are not normal, there is help, there is a cure, or like whatever phrasing you want to use. I’ll leave the messaging up to you. But just having that out there because there are women who are like, well, I guess this is just how I am now, after having a baby, this is just what it’s like. And it doesn’t have to be. Um, yeah, that’s that’s interesting. I would love to see you brainstorm different places like yoga studio, what a great idea. Um, brainstorm different places to network, and then like once a week, send out an email or twice a week send out an email to 10 companies. Hey, this is what I do. This is how I can help your clients. I’d love to come in and chat.
Guest: Ooh, I like that. One thing and one thing that I do, I’m uh, self pay, so I don’t accept insurance, so that is has a lot of potential. Um, it allows me to see a lot less people and to spend more time with them and have what, you know, so I’m part of it is telling people like why they should not use their insurance to come see me, which is tough. Uh, so I’ve been working on that too. It’s just explicitly telling them like when you work with me, you’re not working with anyone else. You’re spending, you know, this whole thing, like the benefits of working um, from a not in network.
Mindy: Yeah, and it can be beneficial to have someone, uh, like a writer help you craft that message because it is difficult to get over the whole, oh well, I can’t use insurance, forget it and I’m done. Like that’s a big hurdle. So, here’s why it’s a good idea or here’s why that’s beneficial to you and having somebody who can help you craft that message could be really helpful, really powerful.
Scott: Amy, how, um, how many hours, what hours, how many hours per week are you willing to work and what is your hourly rate that you charge?
Guest: Are are you asking how many patients am I going to see a week or how many hours total not including patient care.
Scott: I I’m wondering how many, um, what I’m I’m trying to figure out the ceiling for revenue for your business. If you were to fill up every available slot, if you were to optimize your business, what would be your your maximum potential revenue in a week?
Guest: Yeah. So I’m willing to see around up to 20 patients a week and I charge on average, and I mean on, well, I charge a little bit more for the evaluation but then the follow-up visits are 165.
Scott: And, so you could do 20 $165 appointments per week.
Guest: Mhm.
Scott: And your schedule would bear that and you would be you would be able to pull that off. And how many hours would that take you to do that? Is it 20 hours? Is it that simple? Or plus the administration overhead?
Guest: Yeah. So it would probably be about 40 hours total, if I was just with all the admin work and all because I’m doing all the marketing, doing all the, um, I have to do documentation and, um, admin, like calling people back, emailing people back, those sorts of things. So, I’m not exactly sure if it would be 40 hours, but I’m guessing it would be about double including all the extra admin work.
Scott: Okay, great. Um, so we could see, we could see a we could see a maximum of $3,300 per week in revenue for this business, uh, if we just do 20 times 165. And how many patients do you see on an average week? How many did you see last week or will you see this week?
Guest: Yeah, so last week I saw 16 patients and this week I’m going to see 14 if I don’t get any cancellations.
Scott: Okay. Um, so 14, so I’m gonna average that out to 15. So we have, uh, 15 patients * $165 * 4 weeks in a month because this is February, brings you $10,000 in income. Are you gonna see $10,000 in income in February?
Guest: Um, no. I I’m not. It’s I, well, in my expenses, I don’t feel like are huge, but and I have them, I wrote down some of my expenses since September, because it kind of fluctuates. Like last month I had $5,000 worth of expenses, which is the most I’ve ever done, but that’s because I had to pay sales tax for the last two quarters because I got behind. And then, um, but this month I’m going to have $2,700 in expenses.
Scott: Okay, so I can say that I I can say that we’re bringing in $5,000 a month right now in revenue and your business is, this is, it’s not like you’re not getting, so, so when I, your husband brings in 50, uh, $2,000 a month and you’re bringing in, you brings in 40 grand a year and you’re bringing in close to 60 grand a year on top of that, likely in a kind of a normalized state. So we’re actually in a pretty good spot here with that. Let me ask you this, if you were to take care of administration, if I could wipe that problem out for you, how many patients would you be willing to see in a week?
Guest: Oh, I probably, I’d probably be able to see like 25.
Scott: Okay.
Guest: Around, I don’t know if I’d necessarily want to see more than 25 or 27. Definitely no more than 30, but it would be a huge, it would be much easier.
Scott: Okay. So, I I love the things on marketing. We do want to fill this up to 20 patients a week and there should be some of that. But you are not far away from being full on your plate here. And so I think that um, you know, this is this is this is how I think about every server, every like solo-preneur, um, service business is, is volume times rate. How do I fill up all my volume? What is my, what’s a competitive rate, and then how do I make sure that essentially every moment that I’m working is spent on the actual revenue driving activity of seeing a patient and there is zero cuz your time is worth $165 an hour. An administrator’s an administrative assistant’s job is $15 or $20 an hour. You wanted to see, spend more time with your son. I see an opportunity there. Um, can your son book the appointments um, for for those things? Can you pay him $15, $20 an hour to help you with all of that stuff. Maybe he can’t do marketing. that sounds a very difficult challenge uh for a 13 year old boy to handle in your business. But perhaps he could uh set the appointments and and do those types of things.
Guest: That might be it. The only thing, I think he would have a hard time booking new appointments or new patients uh trying to talk to them about leaking and know. No. Yeah, and that’s the another thing is we even thought about like maybe my husband can step in and like try to help out with some of this admin stuff more and maybe that would be worth more than him if he can still keep his current job and you know, find ways to help me out, maybe he would be able to uh it would make sense to uh we could make that work. But um I have thought like I don’t know if uh I do work mostly with women, but I I don’t know if they would be okay with talking. My husband’s very approachable and very nice, so maybe it would work out. But uh I thought they might
Mindy: I’m gonna say that you’re biased because he’s your husband. And if I was your client and I called up and or I’m a potential client and a man answered the phone, I may not continue calling or continue talking to him. I may say wrong number or just hang up. Um, in your field, like I don’t go to a male gynecologist. No uterus, no opinion. Um, I just go to women. So I can see, sorry Scott, I would, I would want you to have a female receptionist to do the the bookings.
Scott: I think that, I think I completely agree with that in this business.
Mindy: That doesn’t mean that there’s other jobs that they can’t do and I completely agree with what Scott’s saying. if you can make 165 an hour, then you should not be spending your time on $15 an hour jobs and I think that there’s a lot of um even high school students come in after school and work for three hours calling patients back and scheduling appointments. Um, you know, work from home and call people back. There could be a lot of opportunity to uh to do, you know, things like that where you’re spending a lot less money, even though it’s money going out, you’re now able to do more $165 an hour jobs.
Guest: Right now, I do have one of my friend’s daughters who is a senior in high school and she is doing my laundry for me. So that’s been really nice to not be taking five bags of laundry home every two days. That’s been really nice. So, and I have been thinking about maybe using her. So maybe I could talk to her about it. She is, she’s kind of like Gen Z scared to talk on the phone type of a person, but I might be able to train her. I don’t know. We’ll see. We could role play.
Scott: And this might be a great opportunity for, um, a retire or something like that as well, um, who wants to make some side income in in that. Um, but yeah, I I agree now, you know, I I’m obviously with this business, I think that, uh, that makes sense to have a a female receptionist, perhaps someone who can empathize to some degree with the patients might be good, really good requirements for for this one. But, um, yeah, I think you should I think you should sit down and say what is the amount of, how long is a session in your business?
Guest: Uh, I have one hour sessions and two hour sessions. Mostly people coming from out of town that they might have a two hour session.
Scott: I would I I would potentially suggest and I I’ve seen a lot of physical therapist because I’ve gotten injured in rugby so many times um with this. But I would I would potentially suggest a 50 minute time slot, which I think is very probably consistent with what you see with a lot of folks that will give you 10 minute times between sessions or 55, even 55 minutes. Um and I think it would be kind of a game of Tetris and from scheduling. How do you optimize? You your you should be like by the end of this year, I’m going to be working 25 hours a week or 30 hours a week and and it’s going to be or 35 or whatever it is, and 90% of that is going to be seeing patients. Boom boom boom boom boom boom boom. I’m going to set up, I I’m going to be going in and in between, I’m going to wash my hands, take a sip of water, have my 20-minute lunch break, and I’m going to crank this thing out while my son is at school, for example. And that is going to fill up my entire day and I’m going to optimize for that. Everything that is not seeing patients or getting new patients, at least at first, is eliminated. There should be somebody at the front who is booking my my patients. There should be somebody who is, um, ideally in in in marketing. If, one one idea as well is and I this is the chiropractor um that I go to, so I don’t know if it’s it’s sort of similar, but they have like three chiropractors in their practice. They all own the practice and that allows them to share marketing and overhead costs with that kind of with that kind of stuff. So maybe you said you have competition, maybe those other folks are also struggling with that, but together, you could essentially book up your entire schedules because it’s really just the amount of hours you’re working times the rate and maximizing it um and if you just share the overhead you you could you could you can get an office or something like that um to do something like that with with two or three partners.
Guest: Okay.
Scott: How are those for ideas?
Guest: Yeah, I think, I think that’s a, I love that goal, just saying by the end of this year, I will be working 25 hours just seeing patients. That sounds amazing. I hate, I hate all the admin stuff. Uh, one thing I was considering, um, is eventually, once I am full, is hiring like another PT. So I don’t know how that would go, um, uh, you know, versus having like a partnership with a couple other PTs and sharing the overhead or would it be more beneficial maybe to hire someone to also see, you know, patients at at rates.
Scott: My my instinct is this is going to be a very difficult business to scale and sell because it is a service. And why did you leave your role and go out a your own, right? How are you going to solve that problem for the next for for the next excellent PTs with that.
Guest: It can it can be done, but I think that uh, I think that will be a big challenge in this line of work.
Scott: Yeah, I think that the the partnership versus the the hiring somebody, how hard is it to train somebody in this? Like is this a a specialty, like, uh, doctors have specialties or is this something that you would train them kind of on the job sort of thing?
Guest: So, it is a specialty. You don’t have to do a residency like MDs do to do this. Um, it’s something that generally takes a few continuing ed education courses that to become pretty good at it. And then just the experience and then I would be doing training on top of that as well because if if I did hire someone, I would want them to be providing like similar, very quality care. Uh, so it would be kind of there would be a lot of training involved.
Scott: With something like this that is so personal and so specialized, I would almost want to hire to partner. Like you hire me to come in and work and you discover, wow, Mindy does not have the same bedside manner and all of the people that are coming here and seeing her don’t come back. She’s not a good fit. Or Mindy is amazing. She’s the exact same person that I am. She is such a perfect fit. I want to approach her for a partnership. But I would start with hiring because it’s easier to fire an employee than to separate a partnership. I would even consider a sharing of the office space rather than a partnership with other people that are in a similar field just to, you know, kind of, uh, gather up everybody in one location and then if you aren’t available, but Barb is, you can say, oh, I’m not available right now, but Barb has an opportunity to see you today, um, because you need to get in or whatever, uh, as opposed to an an actual partnership because maybe Barb has a very different bedside manner that, you know, works great for her clients but not yours. Um, partnerships are, I think you should be very slow to enter partnerships.
Guest: Yeah, that makes sense.
Scott: And I mean this is all like homework and things to think about and you know, what does an ideal partnership look like to you? And what does an ideal, uh, employee look like to you? And really think about this because I don’t think right now is the time for you to jump into a partnership, but maybe by the end of the year. So start thinking about what you would want out of this. Um, I I see a lot of people, especially in the bigger Pockets forums, which is, you know, not related at all to this, but they they talk about their partnerships and they’re like, hey, I have this terrible partnership and you read a little bit more and you’re like, well, because you jumped in with both feet and you met this guy at a bar yesterday and you like went into a partnership with this person and you didn’t know anything about them. So I think it’s like a your business partner should be absolutely like your like relationship partner. You don’t get married after meeting somebody for five minutes. You don’t you shouldn’t be in a partnership with somebody after meeting them for five minutes. But just like think what do you, what do you want in a partner and you know, go from there.
Guest: Yeah, that makes a lot of sense.
Scott: And I think if you if you want to go the business business route, I it’s not impossible. I don’t want to completely turn you off to the idea yet. It’s just you would need to solve the problem. what what would I join right now? some someone offered this to me, what would solve my problems and why would I stay with them for for 5, 10 years because they’re gonna have you’re gonna want to make money off of your your, you know, off a physical therapist, right? And so that that is how you’re you’re gonna have to take that out of their margin. Therefore, you have to make it. If you can create a system that keeps them fully booked all day long, their overhead’s there and they’re able to make 80, 90% of what they, what they charge with that, okay, or some some some high enough percentage where that that’s worthwhile. They don’t have to worry about anything other than just like treating patients and having them come back and like them. Um, maybe maybe you can get there. Uh, and that that has been done and could be could be repeated by you. But I think I think it would be you have to solve that for yourself first, and then in and if you can solve it for yourself, maybe you can solve it for the next person and then begin scaling there. But I I think you have a very I think it’s it’s about if you can get the patients and you can have somebody else handle the admin, so you’re just treating folks. If you can get there by the end of this year, you’re going to be bringing home 150,000, 160,000 a year. That’s a tall order. That’s a great project for this year and you’re not that far away from it. That’s that’s almost that’s less than doubling your current patient load, and I think it’s very achievable if you make the right connections and do the right marketing. One last thing on my my spiel here, I kinda, I kind of wonder if social media is gonna be an effective marketing tool in this context. It might be helpful to have a social media and a website that looks professional, so folks can can check it out, but you know, you’re your clients are gonna be regional and they’re gonna be having a very specific set of of of issues that they’re dealing with that are likely gonna come from referrals, I think, from the local hospital or friends and family or a network that’s gonna come in there. So I I wonder if if from a marketing perspective, that those would be the places to try. How do I get, how do I become friendly with the nurses, because those are the ones, you know, uh, that that you spend all the time with, um, uh, that that can maybe help me with that. Is there a referral fee I can pay? Is there can I just be nice and have have relationships? What what is the what are the ways I can get tapped into the right networks that will give me a flow of clients instead of maybe, um, I don’t know, whatever. So yeah, uh, Caitlyn, our producer gets 100 bucks for every time she refers someone to her dentist. Is that something that uh, that can happen with your, your patients? Yeah.
Guest: Yeah, and I’ve been, uh, I do have an OBGYN who knows me from my old hospital, uh, system job, and she does send me a pretty like quite a bit of referrals. The only problem is that a lot of times I find those referrals are wanting to be in network with their insurance. So I’ve been trying to get a little bit more in with other practitioners in town who work with people that I want to work with who have a similar business model to me. So that’s something I’ve been trying to do. I, I mean, the state I live in is not a super wealthy state. It’s a quite a poor state actually. So, um, it’s it’s kind of like I know it can be done, but it’s just not, you know, it’s not like a one of the bigger cities that people are used to having a little bit more money and paying out of pocket for stuff like that.
Scott: That’s another vote for a partnership, right? If you have a partnership, then whatever costs are associated with dealing with the insurance company, um, from an admin perspective can be shared by one person at the front desk who can take the calls and then when they’re not coming in, handle all of the issues that go along with with with taking insured clients. So.
Guest: Um, well, has this has this been helpful?
Guest: Yeah, it really has. Um, I do have one more question and this is, uh, it didn’t, this happened just, uh, two weeks ago, and that was before. So, uh, we had to, unfortunately, take out a car loan because my husband was in a minor car accident that, uh, his car is away. So now he used that excuse to get a old Toyota Tacoma. So now we have a $13,000 car loan, which I’m really bummed about cuz we’ve been pretty much debt free besides these student loans for a long time. And so, uh, I, it’s about 350 a month. Uh, so, I don’t know, should we be really just paying that off as soon as possible?
Scott: What’s the interest rate on that?
Guest: Uh, it is 13,000 at 6%.\Mindy: 6% is that squishy area where Scott is is unsure. Do you like having debt, or are do you hate having debt or are you not so upset about it? It sounds like you don’t really love having debt and if you have extra money to throw at it, maybe you do that or maybe you put it into a bank account and have it there to pay down, but also it’s available if you need it.
Guest: Well, yeah and that’s the other thing because our emergency fund is about 10,000 right now and I’ve been trying to build that up as we’re finally, I think more cash positive this, these last couple months. So it might, I I like that idea of putting it in a bank account.
Mindy: Because bank accounts are paying like four four and a half percent now. So there’s it you’re still paying more on the loan than you are earning on the bank account. But you have the ability to access that bank that money if you need to. Um, if the debt keeps you up at night, then pay it off.
Guest: Okay.
Scott: Yeah. I I think there’s no right answer. You’re a no man’s land where it’s high enough where it’s like, uh, that is that is kind of tough. 6% is tough, um, at least especially in the context of what we’re used to seeing for the last 10 years, but it’s not so high that you couldn’t beat it if you wanted to invest, for example, in even like long-term index funds, you might, I don’t know what they’re gonna do for the next couple of years, but historically, you can often get 7 to 10% returns in there. Um, yeah, I think it’s as my mom used to say, six of one, half a dozen of the other.
Mindy: Okay. Well, Amy, I think we gave you a lot of things to think about. I would love for you to reach back out and check back in with us.
Guest: Yeah, definitely. Thank you guys so much. Hopefully I’ll be 25 patients. It seems it I know it doesn’t seem like that much, but it just seems like an insane amount to me even though it’s not actually that much. So.
Scott: It’s a fantastic living if you can, if you can, if you can uh, max that out and set up those systems. And you’ll like it more, I bet, if you just, if you’re just doing what you’re wonderful at.
Guest: Yeah, yeah.
Mindy: And one last thing, you don’t have to go from everything doing everything yourself to only doing patient clients or seeing patients, like you can slowly remove things out of your, out of your, off of your plate. Um, you know, as as you get busier, take things away and, and, you know, find a really great receptionist, pay that receptionist well so you don’t have to constantly be training them. you’re, you know, saving a dollar on their, their annual, their hourly salary, but then you’re training them every six months because they keep leaving.
Guest: That’s a really good point.
Scott: I here here I’m gonna change something. I would definitely experiment with an administrative assistant, a receptionist who can help you with this before paying off your car loan. That’s a that that is likely to be a way better return for your business if you’re able, you don’t have to hire them full-time because you don’t need them full-time yet, but if you can get a part-time person to come in a few days a week when you’re booking all your appointments and stack them. If you can just get to Monday nights are totally full for the hours that you want to work with clients back to back and you can do that by the end of the quarter. That would be absolutely fantastic. It might and then you can fill out Tuesday, then you fill out Wednesday, and then you can hire this person there’s whole days when that gets going, they can start taking on all of that stuff because they’re going to have time. Um, that would be that would be a much better investment I think than, um, paying off the car loan early.
Mindy: Yes, I agree completely.
Guest: Yeah, definitely. I I like that a lot because I feel like there’ll be a lot more benefit. Uh, yeah, it’s just kind of scary. I don’t know why. It kind of freaks me out a little bit to hire someone.
Mindy: baby steps.
Guest: Yeah, baby steps.
Scott: Make it a contract at first and and hire and hire and and give it get really clear on what you want what you want them to do from from a duty standpoint. see how it goes for a couple of days, um, or maybe a maybe a month or two, and then make it a part-time employee or full-time employment, um, deal. But that would be that would be how I would start and it’s a little risk there. If it doesn’t work out, you just don’t renew the contract.
Guest: And so I could do a contract for like four weeks?
Scott: Sure. You could do a contract that’s hourly.
Guest: Oh, okay.
Scott: Amy I’m gonna I’m gonna pay you $30 an hour and you might be paying a little bit more than you would like a full-time rate, um, but you could pay for example $30 an hour for for one eight hour day that’s 240 bucks. that’s two patients um so see how see how that goes, and then um, see if you want to keep doing that.
Guest: Okay, great.
Mindy: Yeah. And I like the way Scott just framed that. That’s eight hours of work for for one person and two patients for you.
Guest: Yeah.
Mindy: So start looking at it in how many patients am I going to have to see in order to cover this cost? Oh, one more patient and now half of my, I have a four hours of work and all of my documentation is done for today, or all of my billing is done for this week, or all of my, uh, booking is done for this week.
Guest: Yeah, that sounds, that’s, that sounds great. That’s a really good idea. And then, cuz sometimes I don’t call people back fast enough because I’ve been in with patients all day and then they said, oh, I booked somewhere else or, you know, so I feel like it might even get my schedule more full cuz I’m not, people aren’t waiting as long to hear back from me.
Mindy: Exactly.
Scott: If you try booking with like the folks that have been in business for a long time in your area, that would also be really good customer research and say I want you to answer the phone exactly like this. I want you to do or or go, you know, if if you want to even look in another city because you don’t wanna, um, you know, you feel like they know you, uh, just call them up and and say, hey, I’m I’m trying to book here. How does that work? I I bet you that, uh, you’ll find somebody that has a really good system set up a calendar software, uh, a receptionist who’s gonna pick up the phone in the first ring or if not has a really friendly voice, you know, especially during business hours, um, we’ll put you on, and that will be a really good easy way to learn and you can now you can write your one or two page contract and job description in a way that is more prescriptive, that’ll be the hard part for you is learning how to describe exactly what you want and enforce that with with a contract hire and then ultimately a part-time or a full-time employee.
Guest: Yeah, definitely. I think I will have to come up with some sort of script, like very, um, cuz it’s, you know, it’s not easy to find people to book.
Mindy: All the work you’re putting in upfront is going to make their job easier. They’re going to be less frustrated. And when you’re not frustrated at your job, you’re not thinking of quitting.
Guest: Yeah.
Mindy: Okay, perfect. Well, Amy, thank you so much for your time. This was a lot of fun, and I’m, I’m serious. I want to check back in with you in like six months and see what has happened.
Guest: Yes, definitely. Thank you so much Mindy and Scott.
Mindy: Thank you, Amy, and we’ll talk to you soon.
Guest: Yes, I’ll talk to you soon. Bye.
Mindy: All right, that was Amy. Scott I think you had some really great advice for her. I think that entrepreneurs are either too quick to hire or too slow to hire, and I think she’s in a really great position right now where she can start to think about hiring and I think we had a lot of great advice for her on what to look out for and you know, gave her some homework to to consider.
Scott: Yeah, I thought you had really good advice as well, Mindy. I think this was a a good discussion here and and the the term I would love folks to take away from the discussion. The tool that I used to kind of, uh, uh talk through some of those points is called unit economics, right? So a patient charges 165 bucks. There’s a cost associated with that. Some of it’s administrative, some of it’s this special specialized care that only Amy can give, some of it’s the rent that she’s paying either for her house or the office space that she’s leasing, all that kind of stuff. What are the unit economics there and how do you maximize them? Some of those are fixed like rent, right, that you have to pay every month and you spread it accross the more patients you see the lower it is per unit. And some of them are variable like her time with that. Um, and the the key to a services-based business is to maximize the volume and minimize the overhead and spend as much of your time as possible on patient care.
Mindy: Yep, absolutely. I think that sometimes, I mean, that’s the whole point of the finance Friday is to give our guests a different way to look at things and I think that she has been, I think you’ve opened her eyes with that and now she’s going to be thinking about, oh, how many hours is this going to take off my plate? so now I can see more clients.
Scott: And there are hundreds of people in her local market, I guarantee you, that would be absolutely thrilled and delighted to have a 30, 25, 20, 250 dollar an hour job. um that was in an environment like that that’s helping people achieve good outcomes and I’m sure she would be thrilled to have all a lot a much greater income only doing the thing that she loves doing and is trained to do.
Mindy: Yep, absolutely. When you first start out, you have to do it all yourself, but you can quickly shed responsibilities, those $10 an hour jobs, $15 an hour jobs so you can focus on the high dollar jobs.
Scott: All right, Scott, should we get out of here?
Scott: Let’s do it.
Mindy: That wraps up this episode of the Bigger Pockets Money podcast. He is Scott Trench and I am Mindy Jensen saying, top top lollipop.
Speaker 1: If you enjoyed today’s episode, please give us a five-star review on Spotify or Apple. And if you’re looking for even more money content, feel free to visit our YouTube channel at youtube.com/biggerpocketsmoney.
Speaker 1: Bigger Pockets Money was created by Mindy Jensen and Scott Trench, produced by Kalyn Bennett, editing by Exodus Media, copywriting by Nate Weintraub. Lastly, a big thank you to the Bigger Pockets team for making this show possible.
