Reaching out for help from coaches helps us gain the needed insights for the development of our practice. In this episode, we are following up on the owner of Druid Hills Physical Therapy in Atlanta, Georgia, Dr. Avi Zinn, PT, DPT, OCS, about how he has developed his business. Although he has been successful in the development of his practice to this point, Avi reaches out because he recognizes that he needs to gain more business knowledge as the CEO of the business. He shares the importance of the stuff they did not teach in PT schools, such as tracking KPIs, leadership development, culture creation, and more. Learn how he is managing as a PT business owner and get a real-life look into what a business coach can do for you and your practice.
This is the first episode that I have with an individual PT owner in which I'm going to follow along with him as he receives coaching and implement some of the coaching programs into his independent PT practice. Avi Zinn is a Physical Therapist out of Atlanta. He reached out to me to get some coaching and see if maybe we could work together to help him achieve his goals. Full disclosure, he didn't end up going with me as we talked a little bit about what I could provide and if that might fit for him. I actually offered him a couple of friends that he could call and talk to about getting coaching and consulting services with them and he decided to go with a friend of mine, which I'm excited about. Avi’s ready to grow and he needs to take the next step. I wanted to bring Avi in order to not only follow his path but also because Avi is pretty unique. He hasn't followed the typical entrepreneurial path. He didn't go through the burnout, the crash and burn stages that many of us may have gone through before. He did something different. I want to share his story with you.
I've got Avi Zinn, Owner of Druid Hills PT in Atlanta. I'm excited to bring on Avi because he reached out to me in regards to getting some coaching and we've talked a number of times about his needs and how I could help him out, but things changed a little bit. He is looking for some coaching and consulting help and I want to follow his progress essentially and see what the coach or consultant has done for him to forward his clinic and to achieve his goals. This is the first introduction of that series of interviews because I imagine that down the road I'm going to do some follow-up interviews with Avi. I'm going to show you what it's like and what you can expect out of coaches and consultants and how they can help you as an owner. Let's get to know Avi a little bit and some of his influences and what got him to the point where he was reaching out. First off, thanks for coming on, Avi. I appreciate it.
Thanks a lot, Nathan. I’m happy to be here.
Tell us a little bit about you. Tell us a little bit about your professional path. How long have you been a physical therapist? How long you've been an owner? All that stuff so we can bring everybody up to speed on.
I went to PT school in New York. I finished in 2009. Shortly after finishing school, my wife and I moved to California and we went to the Bay Area. We were in Berkeley. I started my PT journey there. I’m looking for places to work, trying to see what was there. I found a cool PT practice based off their website. They’re more independent. The pictures of the clinic looked personal. They had a good vibe. I reached out to them and they hired me on, which was cool. Starting there was a good experience for me in a lot of ways, which ultimately led me opening up my own clinic.
Did you always have aspirations of having your own clinic?
No, not really at all. When I first started there, they had just done some coaching and consulting. They were in the process of transitioning their whole business model. I soon found out that when I started on, there was a huge turnover right before I came. I didn't realize that at first, but after being there for a few months, the remaining people that were still there were starting to talk about the old days or how things were different and not necessarily bad, but I think the change of the business structure led to other people just didn't agree with what they wanted. From following your show and all the people you've had on, it seems like that's a pretty common thing. You guys talk about your culture and your team. If you're changing your business structure and you're changing your team, then you’ve got to make sure that people are in line with that. I would assume if they're not, then they're going to leave or they're going to get told to leave. That led me to start my own clinic because it was an independent clinic. It wasn't a chain and it was two owners and they had a few locations at the time. I started seeing what it was like from the owner's side of things because they were at the clinic all the time.You have to take risks in order to have something you desire to create. Click To Tweet
Whereas later on when I started working for chains or hospital systems, you don't see the owners at those clinics. You just see clinic directors or whatever. Being there, I saw that the community and the PT practice had a great reputation. People knew about it but at the same time, the employees, the staff, the PTs weren't saying the same things that the people in the community were saying about the PT practice. It was interesting to see how there could be a different perception that the patients are loving it, but the PTs aren't. That probably happened because of the change in the business structure and however that played out. I started realizing that there could be different ways of going about this business. Clearly, we're providing good service because people were talking about it and people knew about it but the staff wasn't happy. That was interesting to see. That's what really started me thinking about like, "Maybe I could do this." Everyone thinks, "I could do this." I thought, "If I am going to do this, maybe I'd make it so people are happy at their job."
There are a couple of different reasons why people open up their own PT clinics. Either they have an entrepreneurial spirit and they want to own the job and that's something that they have a burning desire to do. I'm sure there are many other reasons, but the two that come to mind are the second one being, "Maybe I can do this better or maybe I can create something that I can fill a need or I can create some value that I don't see in my current position. I can treat the way I want to and expand on that.” There are a number of different reasons in your situation, in particular, you're thinking, "The owners are doing great. They've got a great connection with the community, but the internal structure and culture could be improved. Maybe I could do that myself and create my own thing." Is that about right?
Yes, that's right, Nathan. You have to remember, I was in the Bay Area, that's a hotbed for startups and entrepreneurs. I do think that was a part of it. I remember a good friend at one point. I was talking about a startup and entrepreneurs. He even said something to me that I could be an entrepreneur if I started my own PT clinic. At that time, I didn't know what that meant to be an entrepreneur. I didn't realize that starting a PT clinic would be the same thing. Getting that entrepreneur bug, that's what I'm sure we'll end up talking about pretty soon in The E-Myth what Michael Gerber talks about. I think doing it better though and realizing that maybe I can do this in a way that would provide that service and also have the people that work there happy as well. What I was seeing at that clinic that combined with getting that entrepreneur bug, those two started the process of me thinking about at one point starting my own clinic.
You eventually went to Atlanta and decided to do that?
My wife is from Georgia. She grew up in Savannah and I'm from St. Louis. We were in California and we didn't know totally, but we started thinking that we would want to be closer to family. Atlanta seemed like a pretty good city. My wife did an internship in Atlanta and that was when I stopped that job. We went to for the summer to Atlanta to do the internship, but also see if Atlanta would be a city we'd want to move to. We liked it and when we went back to the Bay Area, we knew we were going to move there. I knew I wanted to open up my own thing or start my own clinic, but also knew we were going to move at some point. I never really wanted to do it in California. At that point, I started doing other jobs and experiencing different types of PT. I did work comp for two years. I started doing home health, which was interesting. I did that for a bunch of years.
Eventually, we did move to Atlanta and started doing home health when we got here to learn the city also. It was a good opportunity that I learned the city, but I was driving around for home health. I was trying to get a sense of where I would want to start a practice. It all happened at a time where I was ready to do it. This location opened up right in my neighborhood. Literally, a four-minute walk from my house. It's on the main street. It's across the street from this big shopping center on this road where they say 50,000 people drive by every day. It was perfect. Everything worked out. That's when I started to get things going because we found this place and I had been thinking about this all these years. It was time when this place opened up.
How long ago was that?
That was the end of 2017.
During this time, had you been reading any books about business ownership or accessing any resources?
When I was doing home health, I was driving all the time and I stumbled upon Paul Gough's podcast. That was really the first one that I started listening to. That was talking about owning a business and how to run it. I don't know if this is exactly what he said, but this stuck. He said, "You don't have to have the best PTs, you just have to have good PTs. You can hire the good PTs and you have to be the one who's working on the business.” The truth is I could be combining that with some of the other, like Michael Gerber, your show, but I believe he did say that stuff and it started making me think about how I was going to set up a practice and what that meant.
The cool thing is that it set up a mindset for you, knowing where you are. You don't have to be the best physical therapist. Soft skills are more important than hard skills. You already had an idea that you were going to bring on some other physical therapists anyways. It wasn't going to be the obvious in a physical therapy clinic and a one-man show. You had aspirations for more right off the bat. You've opened up your clinic and how did you start working in it? How did you start developing it, so that it wasn't obvious in physical therapy clinic?
When I was trying to figure out what to call it, I was really against calling it my last name, Zinn. A little back story. My father-in-law has his professional experience. He opens a lot of businesses. He was able to guide me through a lot of this in the beginning. Helped me set up the LLC. When I was looking at this place to rent and lease it out, he guided me through with creating a pro forma and talking to the landlords about having my financials in order, even though we didn't have the financials in order. Getting that set up and he was set on calling it Zinn PT. He wanted me to do that and I was like, "I don't want to call it Zinn PT. I don't want it to be about me." Maybe because of listening to the podcast and knowing Paul Gough’s podcasts, knowing that I wanted to bring people on and I didn't want it to be about me because maybe had a little foresight knowing that I would have to do the business stuff at some point and not always having people wanting to go to Zinn but to the PT practice.
What did you start doing initially to make it so that it was not Zinn? You ended up developing Druid Hills Physical Therapy, you were the initial physical therapist. How did you start the progress? This is an important part of the introduction of you. You did things a little bit differently and I'll highlight that as we go through the story.
First of all, I was still doing home health, which was a huge help because home health is super flexible and I was able to bring in some income while setting up the practice as a group. There was no other way to do it. I took out a loan. I could've taken out a loan three times the size and lived off of that for a while. That would have been a little overwhelming. Setting it up, I started getting things in order. I don't know if it was from the podcasts or not. I wanted to experience every part of the business at first to know what it was like so that I could start putting people in those places. When I started, I did everything. I was a PT but I was also running back and forth to the front desk to answer phones and schedule. Instead of a front desk person, I had an answering service, which was helpful and they would email and text anytime someone called. I had a doorbell. That was my front desk person. If someone came into the office, I knew someone was there and I could run back and forth to the front to greet them. I started getting things in place. Aside from the business things, I had to start getting patients.
I tried doing all that I thought would have been the normal way to do it, which was called doctors but that didn't work. It started with that. I was lucky that a third-party work comp insurance called me and they were like, "We want to give you a contract and send some people to you.” I was like, "I need people to send patients," which was also cool because work comp authorizes a certain amount of visits, they pay the rate, whatever it's going to be. You don't have to fight with the insurances. They're not going to like deny certain code, which was a great way to start. Because I got those patients, I knew those visitors were coming in and I knew they were going to pay whatever they paid. That was also a little bit of a hard part, to begin with, was the money part. How you charge people. All of it was hard. I didn't know how to do anything.
How long did you go like that before you took on your first hire and eventually before you got your next physical therapist?
I started at the end of 2017. We had our third kid in March of 2018. It was a great idea to start a business and have a kid the same year. Right after that is when I hired on the first PT. The business was growing slowly. Knowing that we were going to do this, I started looking back at the schedule and tracking what was happening. The schedule was pretty light. Looking back, I don't know how I was confident enough to even hire someone on.
That's the question I have for you. How many visits were you at per week before you hired that physical therapist because you went against the grain?
I don't know. At that point, I was doing three days a week at the office and still doing two days a week home health.
You brought on your PT at that point. This is why I wanted to bring you on is that you hired a physical therapist, what most people would consider is too soon. Based on my training experience and if you were to ask me, "When do I bring on my next physical therapist?" I'm going to tell you, you bring on the next physical therapist when you're meeting at least 90% of your slots that are scheduled out in a given week on average. That's the time when you know, I'm working hard or my other PTs are working hard. It's time to bring on someone else where these people are going to get overwhelmed. Maybe you even have a waitlist, but you went against the grain and you don't necessarily know why. You brought on a physical therapist because this is the thing, the typical entrepreneur story is we don't do anything until we get overwhelmed. Sometimes there's a crash and burn element to it. If you read to some of my previous shows and the successful entrepreneurs but you didn't get to that point, so you brought on the next physical therapist. You must've had some faith that things were going to go in the proper direction or maybe you had some real intent out there in the universe that things were going to grow?
It was a little bit of both, Nathan. I was thinking about starting a business, in general, is a huge risk and I've maybe realized that you have to take risks in order to have a business. That was the same move. I saw the trajectory and patients, it was growing slow but it was steady growth. It looked like things were going in that direction. It was time to hire someone on and keep it going.
During this time, were there some resources that you fell back on that might have stoke that faith or inspired you to bring on someone else so that it wasn't on you? Did you also maybe see that there were some aspects of the business that you needed to work on so the PT would take the treatment side of things off of you so you can focus on those things? Was there a combination of some of those?
Because of how busy things got, I realized that I had to do more of the business stuff. That was what it was. It was the beginning of 2019 or it must have been earlier when I started following your show. I remember in January of 2019 is when I started reading The E-Myth. I don't remember exactly when I found your show or how that happened exactly. Even before that, I realized that I had to be able to step away to do from treating, there were only so many hours in the day. I didn't want to be working all day long and then going home and working all night long. I realize that the only way to do it was to step back a little bit. It wasn't a lot, but it was by hiring another PT that I was able to step away and do a little bit more of the business side of things.You have to take risks in order to have a business. Click To Tweet
The common fear when someone makes that first step is to bring on another PT. The biggest fear is, how am I going to justify that salary? I'm going to be paying somebody $70,000, $80,000. What if they don't work out and they don't produce? Somehow you overcame that fear. How did you do that?
After that first job in California and when we came to Atlanta, I did a traveling PT job. When we went back to California, I started doing PRN. When I learned about what PRN meant, that is ultimately when I hired my first PT, I didn't hire her on full-time. I hired her on PRN and it just happened that I found someone who wanted to do it. She was in a different job and she wanted to switch it up a little bit. She started doing two days a week with me. That is why I was able to not be so overwhelmed because essentially instead of making it five days a week for me, since I was only doing three days a week in the office, I made it a five-day PT but split between two people. I was able to have the patients coming in on all day, every day and then still have two days a week where I wasn't treating and doing some of the business stuff.
You were still running the front desk and taking all the calls and some of that stuff?
I was still doing that stuff and the billing, the front desk. Shortly after that, I got someone two days a week at the front desk. Gradually we started getting more patients, so that part-time PT ultimately wanted to switch all for hours over to this place. It worked out well because I didn't need to look for another person. She was already there. We were organically growing and filling those hours on the schedule without having to hire on a new PT and then have to be scared that you're not filling up their schedule for three months because we did it gradually anyways when she first started by two days and then added on more days.
She started taking on more hours. You started treating less it sounds like and you're working on the business during this time.
I don't think I really started treating less because for the most part, I was still treating the same amount, but it had blocked off certain times from the beginning to do billing, networking, calling people and driving around.
That's a huge part right there and I don't want to overlook that. You blocked off time on your schedule. As I'm talking to PT owners that are treating full-time, that's probably one of the biggest hurdles is to get them to commit to blocking off chunks of time, whether it's four days or 4, 5-hour blocks to work on the business. That is to look over your financials. That is to put together a pro forma like you're talking about. Consider what the future might look like. Do some networking. Even start developing some policy and procedures and hiring the right people to fill the spots that you either have open or are going to have open in the very near future. What you started doing maybe someone told you to or maybe you inherently knew you needed to do was to keep that time sacred for admin work.
Around the beginning of 2019 is when I read The E-Myth. That was transformative. I've heard people say it on your show a million times, working on the business and not working in the business. I think he came up with that. It made so much sense and you can't do it any other way. There's only so much growth you can have if you're working in the business. When I read the part about what a lot of people do is they create a job for themselves. That part was like, “I’m not trying to create a job. I'm sure I didn't try to create a business." I did somehow realized that I needed to keep that time separate to work on the business. Once I read that, it was when I started realizing I need to do more of this and if I want to grow, I need to not just hire more people. It would actually start taking more time to work on the business because once you start getting busier with more and more things going on, you need to have more time to figure out all the things that you had mentioned, which I still have not done yet.
We have to give it proper credit. The book that we're alluding to and referencing is The E- Myth Revisited by Michael Gerber. He does layout a lot of this stuff. When we say you working on the business, what are some of those things that you're doing? I have even some owners say, "If I'm not treating and I'm not catching up on my notes and I'm not paying bills, what am I doing?" What do you do in those admin times?
First of all, I still do the billing. That's part of it.
That's going to change soon. What are you going to do when the billings off your plate?
We'll find out soon. You did mention about policies and procedures. That's what I started doing was creating systems, which is what The E-Myth is all about. I created an organizational chart, which is another thing that they talk about in the book. Even though every single job in the organizational chart was me, I still was breaking up what created the business, all the different parts and all the different jobs that make up the business. I started writing out what happens under those positions, what one does for that job. Basically, I use Google Drive and Google Docs and I have a nice organized folders system of docs for every one of those job positions. Every time something happened that day that I had to troubleshoot or figure it out, I would put it in that doc and then I would try to create a system to make sure it didn't happen again or t try to delegate some tasks to the front desk person or the PT so that they can do it so that we wouldn't have to keep on going through the same mistake every time. We would know what to do every time.
You wouldn't have to learn the same lesson twice.
Yes, we don't have to learn the same lesson twice. Also, we wouldn't have to be where someone had to knock on my door and asked me what to do for it.
This is why I love having you on. You're at a place in your ownership that I would say a majority of PT owners are not. I'm including the guys that have been out there for 10 to 20 years. They haven't taken the time to write up their policies and procedures. I can say I was in that boat 10, 12 years after opening up my first clinic. Didn't take the time to write down policy and procedures. I didn't have an organizational chart. It doesn't matter if you are in each position. At least know what the structure of your company is and what it should be and what it will look like when other people start filling those positions is huge. That comes as naturally to some people more so than others, but you're organized enough with your Google Docs to have everything written up underneath each job with a job description, the responsibilities and the tasks that are given to each position. That's huge and that is the reason why you are where you are is because you've done some of those things. How many therapists do you have?
We have three therapists besides me. They're all about 30 hours or so. Part-time but full schedules. One is actually reducing hours the same original one who wanted to take on more but also step out of her first position and try something different. She's going to try something different and reduce her hours, which is fine. Everyone wants to do different things. There's nothing wrong with it. We're about to hire another person and she's going to be my first full-time. We'll have one full-time, two pretty full-times, one part-time and then me.
Being less than a few years into your ownership. That would be unfathomable for some people. I'm talking to some owners who are one-man shows and they're overwhelmed and they're three years into it and they don't see a way out because they're treating 50 hours a week and not working on their business. Whereas you've set yourself up such that you have multiple providers and you're already experiencing some freedom that most PT owners don't have.
Nathan, you probably would agree with this, but for the people that are working crazy hours, I made sure I did this in the beginning, I worked at the office. I did some stuff at night, but for the most part, I was in the office 9:00 to 5:00, and that was it. I made it a point to stop at the end of the day. Of course, you do some stuff at night, you answer emails or you work on the website.
You had some intention behind putting an end to the day.
I think that's what it is. That has allowed me to keep going. It prevented me from burning out and I didn't get so overwhelmed because I was like, “This is the end of the day. We're going to stop, we'll pick it up the next day.” If I work an extra five hours, it's not going to be any different. You need to put a brake on it every once in a while.
There's some power to that. Number one, the time that you do have is limited. There's going to be an urgency to get things done. If you don't have that end stop, you're like, "I can work until 7:00 and I'll take my time getting things done.” Inevitably there’s something called Parkinson's Law that, "The amount of things to do will end up taking up the time that has allotted to do them." If you're available to work until 7:00, you'll have plenty of tasks to keep you busy. If you put that hard stop at 5:00, you've done two things. Number one, you've set a deadline, but also, you were concentrating your efforts on doing the admin work. You can get more done for the benefit of your company by focusing that time on your business than trying to get tasks done. Instead of trying to get payroll down or pay bills. I'm sure you were focusing on what some people call the MIT, the Most Important Thing of the day and that is developed policy and procedures. Get my organizational structure in place. You're doing the billing, but that's a separate chunk of time. The fact that you spent that time on the policy and procedures and the organization of the structure of the company means you've developed solid integrity around that and you've accelerated your growth as an owner and as a business to the point where you are.There's only so much you know how to do. You need to reach out and ask people for help. Click To Tweet
To be clear, I still have a lot more work to do on the policy procedures and all that stuff. That's ultimately what we're getting at with coaching and consulting. In March of 2019, I hired on the second PT and then that's when I drastically reduced treating time down to twenty hours a week of treating.
Was that a scary transition or something that you're, "I need to do this?"
It wasn't scary at all. It was, "I need to do this." Partially because at that point I had read enough of your blogs and also had probably read to The E-Myth again for the second time or maybe even third time that I realized that it doesn't even matter if it's scary. That's what you have to do. There's no other way around it.
You recognize the need of the company was to go in that direction, right?
Yes and it was my business. If I'm treating, who else is going to work on the business? I have to be working on the business. There's no other way.
You talked to me about doing some coaching and consulting. What led you to that point?
Where I've gotten myself have been a lot of working on the systems and policies, but at the same time, there's only so much I know. As the business grows and when we're getting more patients in one of the main things that I've noticed is there are cancellations and why are we having 30 new patients in a month. We had eighteen new patients in one week and that was awesome. That was the most we had. The following week the schedule was half empty and it was like, "How is that happening?" I started running analytics, WebPT. I called them up asking, "How do I find out how many times each patient is coming in?" I’m trying to see what their plan of care and how many visits per week? I find that a lot of patients are only coming once a week or they schedule two visits and then they're gone and no one was tracking that. I run this lost patient report from WebPT and then all of a sudden, I look and there are 50 to 100 people on this report of people that came in and we never got them back on the schedule. That was a huge thing.
You recognize that you need to start monitoring your metrics and if you haven't taken the time to do that, then the metrics will control you and sink you.
On the analytics and WebPT, they have their main KPIs. There are six KPIs on there and that was cool. I realized I don't know. I feel like I've done a lot to get myself here, but there are people who know a lot more to take those numbers to who've already gone through this, who can tell you how to use those KPIs, those metrics and what to do with them. How to affect them and also, one of the biggest things through all this realizing that I am not just the owner, but a CEO of the company. I need to learn how to do that. I need to know how to manage my employees, train them and set up different structures and have certain people responsible for different parts of the business. I realized that there's only so much I know how to do. That's when I was time to reach out and ask people to help me along that.
You realize that you are the final word. People are going to come to you because you need to have the answers for the company. I don't think a lot of physical therapy owners who are relatively new don't put on that hat per se. They think that the ownership somehow is not as separate from them. They know that they're the owner, but they don't act like the owner and that they should be monitoring all the metrics and the financials. They should have some idea of what to do when a statistic goes bad and how to look and investigate issues in the clinic. It sounds like you had that realization that you need to take on that hat.
Nathan, that part is hard. I went to PT school, I learned how to become a PT. I didn't go to business school. I don't even know if you learn how to do that in business school either. I don't know how to run a company.
We're all in the same boat.
To answer your question, that's what it was. I realized that I needed to be the CEO essentially and I needed to learn what that means and how to do it.
You reached out to me and we had a conversation. I actually gave Avi some recommendations of other coaches to also consider outside of me and he has decided on another consulting company and I'm excited because he's going to do amazingly well. You can see that he's already set up the foundation. I want to follow you along this journey. How will you know if you've been successful with a coach or consultant? How will you know that they've met your goals? Is there a statistic that you want to see? Maybe gross revenues and net profits or is it more freedom for you? Is it growth?
I'm starting to understand financials and understanding gross revenue. I'm at the point where I can look at a P&L and understand it and gross revenue, of course. Let's get that up.
You need a return on your investment to the coach. You expect a multiple of your investment on the coach.
Having the patient drop-off, go away or at least get better. Maximize the utilization, which is something you were saying. If there's so many hours that the PT is treating, they should be treating patients that whole time or at least let's say 85% of it and figuring out how we can make sure that happens. Training the front desk also is the best way to take part in the patient's experience. Also, making sure that they're following through with their plan of care when the PT comes and brings them up to schedule. Making sure that they schedule it and making sure that they understand what it means and the cancellations are detrimental not to their progress but to the whole business. Probably a million other things at the front desk can do but hopefully, they'll help me out with all of that.
Are there some particular goals that you have then over the course of the next year or two? I'm sure the coaches will help you along with this, but what are some of your goals that you have?
As far as freedom goes, I don't need to be not in the office 200 days a year, which is great. Maybe one day. I like being in the office. I like working, but I don't want to work all day, every day. First, producing the treatment hours, that was key. I've done that myself, which is talking to you and talking to other coaches. That's what ultimately is going to set me up for success quickly with these coaches is because I've already done what a lot of people have to do initially once they start with the coaches is to back out of the treating.
You're a step ahead already.
That ultimately is going to allow me to focus on some of the goals a lot quicker. In 2020 who knows? Maybe this will happen in two months. If we have twelve hours of the day in the office, 7:00 to 7:00 and we have five PTs, I want to be able to fill up that schedule, which is ultimately going to bring in more revenue.
You're going to have to expand.
Yes, hopefully. These could be long-term goals. I remember early on Paul Gough that he’s talking about how he owns some of his own real estate and some of the practices. That could be a cool goal. I don't know so much about that on the numbers side. I imagine at some point it's beneficial, but maybe it's not always. That could be five years from now. I want to grow this space location that I have to maximize it. If I have to work twenty hours a week still treating patients, that's fine. I like treating, but I also recognize that I have to do other things. If I need to not and I can get someone else to do it, great. Maybe later on, in a few years, I can start treating again. Wherever the business needs, that's what I'm going to do.
That your decision matrix has to be exactly that. Whatever the business needs. If you're not wanting to set aside time to work on the business and want to treat full-time, then go work for somebody and work full-time. Don't spend the stress and energy to own the business on top of it. If you're going to commit to owning a business, you need to put the business first. That comes first. What a lot of PT owners don't recognize is the clinic needs them to treat less, needs them out of treatment because it's a distraction to treat patients as an owner. You need to set aside times to work on the business and eventually what happens is they work themselves out of treatment because the needs of the business become greater because they were expanding and growing. I'm excited for you and what you're looking. From my perspective, looking at where you're at, you're looking to gain more knowledge so you can confidently and securely wear that CEO hat and become more efficient. You're recognizing that there is a lack of efficiency maybe in your company and you don't necessarily know how to affect it.
That's what I think when I pulled up that last patient report that one time and I realized, that's why our schedule is not full, even though we're getting all these new patients. We need to figure out how to make sure that doesn't happen.Work on the business and not work in the business. Click To Tweet
That's a dagger to the heart when you find stuff like that.
That was hard.
It goes through a couple of things. That is a whole few pages, maybe one or two pages full of lost revenue. More than that, if you're looking at from a higher level, these are patients that didn't get the full complement of care. These are the types of patients that go back and say, "Physical therapy didn't work for me. I've been to Druid Hills Physical Therapy and it didn't help." You don't want that. That can happen unless you're focused on getting them to complete their plan of care. I said this in an interview that I did. I found out about it a couple of years ago when I interviewed Heidi Jannenga of WebPT, and they did their annual survey that most small businesses lose on average $150,000 a year because patients like those on that lost patient report don't complete their full plans of care. That's a detriment to you as a business owner. It's a detriment to them as patients because they're not getting better and the chance of recidivism or the chance that they didn't even get better is significantly higher.
It is a detriment to the profession as well.
We'd become a commodity. They say, “Physical therapy didn't work for me.” They don't say, "I'm going to try a different physical therapist." Like anybody would maybe with a dentist, they say, "Physical therapy didn't work, so I'm going to try something else." It's unfortunate. I'm excited for you and I want to follow along with you and see what you learn along the way and so we can share with the audience essentially the benefits of coaching. I wanted to share your story number one, because it's amazing that you haven't gone through the typical cycle of an entrepreneur that's even spelled out in The E-Myth Revisited. It's not in the physical therapy space, but I think she was a baker of pies and she had that burn out and she's like, "I can't do this anymore. I'm not seeing my family and I hate my job." You never experienced that because you looked ahead and started planning and started acting forward in faith that things were going to continue to grow and it's worked out well for you. You're going to continue to grow that you develop that foundation.
I want to say one funny thing that happened. We're in the process of moving houses. We're going through a bunch of things and I find a box of all my notes from PT school and I open up a folder from my business admin class, the one day that we spent on and pull out the handouts. There was right on the top was The E-Myth Revisited. I don't remember the professor ever talking about that back in the day. If anything, they were doing a good job teaching about business because they talked about The E-Myth. I'm sure there are other ways to look at it, but following that way of setting up systems and organizing the business and working on the business. That is what has allowed me to get to where I am.
What's different about you Avi compared to a lot of entrepreneurs, whether it's physical therapy owners or not, you've had it on the one book and I'm sure you've read other books, but this one's been influential for you. There are people out there that have read the book and I've read hundreds of others and aren't in the position where you are. The differences that you've actually taken action on what you learned. I read The E-Myth Revisited 6, 7, 8 years ago, but I didn't implement it to the level that you did it either. I would submit that people who are reading the business books, if they read The E-Myth Revisited, don't read it as a nice, good story, but to actually implement what he recommends.
The only way to implement it is if you take time away from treating and work on the business.
You've actually put those principles into practice and that's what I separated you from somebody who is simply read the book. I'm excited to see your growth here as you get some greater insight and knowledge on how to improve your stats and become more efficient. We'll follow up with you and do another interview and see what you've learned and what's been influential for you. Maybe there are some pitfalls, maybe there are some things that happened along the way, who knows? You might experience for yourself what your initial outpatient company did in San Francisco. Maybe not everybody's aligned. That or everything is going to go in a great direction because you have your ducks in a row already. I'm excited to see what happens. Is there anything else that you want to share, Avi?
For anyone, if they are reading for the first time, reading your blog has been helpful also. I talked a lot about The E-Myth, especially because I've set aside some time to work on things. I'll read your blog whatever interview person you have on and then try to implement those things that day or that week. It's been also helpful to know other people's stories.
That makes me feel good. Not only a resource but an inspiration to you. Thank you for that. We will stay in touch and we'll come back around to the story that is Avi’s in Druid Hills PT.
I'm looking forward to it.
Dr. Avi Zinn, PT, DPT, OCS is the owner of Druid Hills Physical Therapy in Atlanta, Georgia. He opened his practice at the end of 2017 and has slowly built it up—transitioning from a staff of one (himself) to a team of administrative staff and treating therapists. He continues to grow the practice gradually. Avi’s main mission for Druid Hills PT is to provide high-quality, personalized care to each and every one of his patients.
Avi has his doctorate in physical therapy from Touro College, and is a Certified Orthopedic Clinical Specialist. He lives with his wife and three children in Atlanta.
Love the show? Subscribe, rate, review, and share!
There is nothing more comforting than knowing that you are financially secure for the future. Bringing in a trusted expert from Econologics Financial Advisors, Eric Miller gets into the mindset, attitude, and strategic plans you need in place to secure your wealth for the future and for your household. Eric and Econologics have been working as financial advisors to hundreds of private practice owners over the past decade. Thus, they know some of the pitfalls that we share when it comes to our finances and what it takes for owners to become financially free. Eric goes beyond the investments and portfolios and sets you up with the right mindset and financial purpose and goals that are in line with your retirement plans. Secure your household and make your clinic the vehicle by which you achieve your financial goals in this episode.
I get to talk about money, one of my favorite topics. One of the reasons why I got into business was to have more freedom and security for my future. I decided to bring on Eric Miller of Econologics. If you remember, we had Christopher Music of Econologics on. I've been working with them for a little over a year. I do have to have full disclosure that I have an interest in their performance. I've also been a happy client. The reason why I like Econologics is not only do I like their perspective on financial planning but also the amount of communication they provide. If you follow my episode with Frank Cawley, we talked about important financial indicators like KPIs, reports and developing a financial team. Those things are all important. What I get into with Eric is more the mindset, attitude and strategic plans that you need to have in place in order to secure your wealth for the future and for your household. Important items to consider, this is all about securing the household and making our clinics the vehicle by which we achieve our financial goals. Let's get to the episode.
I've got Eric Miller, Chief Financial Advisor of Econologics joining me to talk about one of my favorite topics, money. Thanks for coming on, Eric. I appreciate it.
My pleasure, Nate.
Can you share with us a little bit about your experience as a financial advisor and your practice or work with private practice owners? What's got you to this point?
Long story short, I am a financial advisor and I've been in the financial industry for about twenty years. I grew up in Toledo, Ohio. I moved to Columbus, Ohio in 1990. The funny thing is I get so jealous of practice owners because a lot of you knew what you were going to do when you're 8 to 10 years old. I was 29 years old before I knew what I wanted to do. I always had an interest in money. For some reason, it was an area that always attracted me. I didn't study the subject when I went to college. When I got out of college, I worked for a mutual fund company selling 401(k)s and managed accounts.
I started to get introduced to what financial advisors did. By and large, what I found out was although they were benevolent and they wanted to do a good job, it was mostly an accumulation of assets. That's what they did. They didn't focus on, “How do we change someone's financial condition?” It was, “How much money can we manage?” I met a friend that said, “I'm going to start a financial planning company down in Florida. Do you want to join me?” At that point, I had a house, a dog and a girlfriend. I knew that was my purpose at that point in time. Like many people, I was like, “If I'm going to do it, I better do it right now,” and I jumped. I drove down there and got rid of that life. This was in 2008. Do you remember what was happening in 2008?
Bad timing.Your practice is what drives your personal wealth. It is the main money artery that most private practice owners have. Click To Tweet
It was a global meltdown. The stock market was down 50% and banks overlent to everyone. It was chaos. It was the worst time you could think of to start a financial planning company. We were thinking to ourselves, “We have to do something differently. We can't rely upon all these financial institutions for people to get financially independent.” We had to come up with a system where the business owner himself could be put back into control of his financial destiny. That's what we worked on. We started working with private practice physical therapists. It was the first type of clientele that we worked with. We developed our system of showing a business owner how he can be in charge of his financial future as opposed to putting it in somebody else's hands. How does he do that? How does he use the business as the engine to do that? We focused a lot of our efforts on that. We started working with veterinarians and other private practitioners, but our core is working with private practice physical therapists.
It’s cool that you niched down like that. You've had so much experience over the past decade focused mainly on physical therapists, so you'll know some of the ins and outs of our dilemmas, issues and whatnot.
That's the fun part about it. Your practice is what drives your personal wealth, for most of you. You don't always want to be in that financial condition. That's where most of the money comes from. That's the main money artery that most private practice owners have. If you're advising someone, you better know something about their business that you're going to help them with their money. We do spend a lot of time on that.
You've been working for over twenty years. For the past decade of working specifically with physical therapists, what are some of the things that you would recommend they consider as they're trying to establish a better financial picture or financial condition? We have plenty of display vehicles out there whether that's the traditional 401(k)s, IRAs and stuff. What is your advice to some of the physical therapists out there?
The main thing that we try to get across is number one, you have to treat your household like a business. What I mean by that is that a lot of physical therapists get trapped in the practice. They're there to serve the practice as opposed to the practice being there to serve them. The first thing that we try to teach private practice owners is that you are not there to serve this practice. It's there to serve your household. When you start doing financial planning, it starts with the household. What are the goals and purposes of the household? How can the practice benefit that? What we do is to teach them your point of where you're controlling things. If you look like a company like Facebook. Facebook is the parent company. It owns 80 companies underneath it. Those companies are there to serve Facebook, not the other way around. Our households are no different. Your household, the Nathan Shields’ household, all your kids and your beautiful wife, that's the parent company. That's where everything flows to for the benefit of that.
It's a paradigm shift. Many owners need to make it because they get trapped inside of the company. I espouse that all the time. That's why I want people to reach out and step out of the business so they can work on the business. It's the same thing when you're talking about financials. It's a mindset shift instead of, “What do I need to do inside this business to keep it afloat?” No, you're saying step out and look at it from the household perspective and say, “What does my household need to survive, sustain and prepare for the future? What can the company do for me in order to achieve my household goals?”
When you have that mindset shift right there, it's amazing what happens. You start to put the correct systems in the business that allow you to extract out of it so you can operate from the household level as opposed to being stuck in the business. When you have a plan, you start to know your identity. When you're in the business, you have certain roles that you have to play. You have your owner role, executive role and practitioner role. Not a lot of people are wearing that owner role like they should. That's where we teach people how to do that.
They conflate executive or administrative work with ownership work. Those are two different things. They maybe can hire an office manager to take over some of those administrative/executive functions and responsibilities. That doesn't absolve you from still being an owner, setting up your company appropriately, strategizing and making sure that it funds the household. This is on top of funding itself, so it can sustain your household.
You hit it right on the head. You can pick two of those roles. You can be an owner/executive or you can be an owner/practitioner, but you're always going to be an owner. You have to make sure that you have that mindset of what an owner does. What does an owner do? They make sure that the practice is creating maximum value for themselves and the household. They're trying to build the practice to the highest value that it possibly can provide for the household. That's what a good owner does.
When you sit in the ownership seat, you also never lose the Chief Financial Officer seat at our size. You're still the CFO. You can't delegate that and you shouldn't. You need to be on top of your cashflow.
You absolutely do. The biggest mistake that I see a lot of practice owners do is they stop paying attention to their money. For whatever reason, that's the one thing that you can never do. Money loves attention. It's like a two-year-old at the mall. If you take your attention off a two-year-old at the mall, you have no idea where they're going to end up. Things get lost and your money is no different. When you take your attention off of your money lines, even for a split second, it's amazing how the money will disperse everywhere. Being a good CFO doesn't mean that you have to know how to do spreadsheets and all those technical things. It means that you have to be a good controller of money. It means that you have to be responsible with money. You have to know the basics of money. It isn't that complex at all. It takes some training that you didn't get in PT school.
I can say that my financial situation improved when I started holding my CPA responsible for teaching me what a P&L was about, what a balance sheet looks like, and cashflow reports. I said, “I need to meet with you monthly so you can show me all these things.” I got my own education about finances. On top of that, I started meeting regularly with my biller, which I didn't do before. I was reviewing some of the billing reports and asking them to tell me, “What does this mean? What does this say? What should I know about this, that or the other?” That's when my ship started tightening up or when I started plugging some holes in that bucket. I could see the difference in finances.When you have a plan, you start to know your identity. Click To Tweet
All you were doing is putting your attention in an area that maybe you didn't confront for a while. One of the things that happen to a lot of practice owners is there's a lot of financial terminology that people don't understand and I totally get that. It's an easy area to say, “I don't want to confront this.” You need to dig into it and have some key metrics. A big thing, especially from the household perspective, is making sure that you have measurements or statistics to track your overall financial condition. It's not that hard to do. That's an obstacle that I see as well. A lot of people don't have correct financial statistics that they use to measure the kind of progress that they're supposed to be making.
A lot of people like looking at account statements. You look at your 401(k) statement and see how your mutual funds are doing. “I see that my bank account is a little bit bigger than it was from the week before and that's okay.” These are some of the things that I've asked people, “What do you use to measure your financial progress?” It's crazy some of the answers that I get. You have to look at that and have a list of metrics that can gauge the condition of the household if you're going to run it like a business. If you’re going to do that, you’ve got to do it professionally.
As people are trying to walk that path towards financial freedom or simply improving their financial situation, what are some highlights or actions that they can take in order to do that?
One of the biggest things is that you have to have a target. The first thing would be like, “What's the financial target that I want to achieve?” I created this chart called the Seven Zones of Financial Freedom. I wanted to make sure that people realize, “What financial condition am I in? What does that mean from a statistical point of view? What financial condition am I trying to get to?” That's defined by how much income I’m making, what my overall net worth is, how much ratio of my good debt versus my bad debt, how many income streams does my household have? These are things that you can look at and you can measure. The first thing would be like, “What financial zone do I want to get into?”
Regardless of what it is, personally, for a practice owner that is in control of your financial destiny, that can create as much value as you want to in your marketplace. If you want to be in a condition where you don't have to have concerns about money, your overall financial target has to be at least $7 million to $10 million of total assets. That to me would be a fairly safe financial condition to get into. It doesn't mean you have to save $7 million. When you look at the value of your business, maybe your real estate or other endeavors that you get into, that's the target you should be shooting for. That's a big thing because we haven't been taught to have that point of view. It's been like, “Let's accumulate a couple of million dollars in a 401(k) plan and let's hope that we don't run out of money.” That's not financial freedom.
As we get started at a young age, we think that retirement goal is so far off that it's not feasible to consider that down the road. The more attention you pay to it, maybe you get a little accelerant and you can get closer to that goal faster than you think. It doesn’t have to be all in your clinic. It could be on other vehicles but there's no reason why you can't accumulate those kinds of assets.
The wealth accumulation is almost like a hockey stick graph or a grind. When you’re trying to create an owner independent practice, you're trying to put these things in and you're not seeing these huge results, then all of a sudden over a two or three-year period, you see these massive results. Wealth building is the same way. You're doing the same repetitive and boring things that you would do and you're like, “I don't know if I'm making a lot of progress.” It accelerates towards the end. The other thing would be the time frame to get into a financially independent state. It doesn't need to take 25 to 30 years to do that. You should be able to do that within 7 to 10 years if you're concentrating on your main money source, which is your practice and building that up.
Are there some things out there that you hear financial advisors recommend that you'd say, “That’s probably not the way you should go?”
To me, it's more of a mindset than the recommendations because I found that every investment vehicle has its place. It's the utilization of it and how you're applying it to your situation. There's not a bad investment, aside from someone trying to rip you off. There's some workability to retirement plans, managed accounts, life insurance or annuities. It would be like, “What's your strategy first?” That would be the first thing I would start with, “What’s your overall strategy?” I'll give you an example of what our strategy is for most of our clients. I have an acronym for it. I call it PREP. It stands for Produce income and be profitable in your business. That's the first target. Second, make sure that you are setting up an automatic and systematic way that you're retaining cashflow from the business to the household. Eradicate all bad waste like interest, cost and debt. Protect your assets from any kind of loss including taxes and lawsuits. PREP, that's a strategy right there. If you focus on those four things, you're going to have a mountain of success.
Anything else that falls below that would be tactics. “Do I buy this policy or that policy?” “Do I put money in this investment or that investment?” It's all part of an overall strategy. A lot of practice owners get caught up in tactics as opposed to strategy. This money market accounts yielding 0.5. Should I put my money on this one or should I put this one that's dealing 1.2? They put their attention on things that aren't going to move the needle on their financial condition. We spent a lot of time thinking about what's the strategy first and then tactics. It was Sun Tzu who had a great quote that he said, “Strategy without tactics is the slowest route to victory, but tactics without strategy is the noise before defeat.” I thought that was important. I know when someone's about ready to lose financially when all they want to do is talk about investment products and performance of something. They’re all about tactics, they're not about the overall strategy. It's interesting.
Do you see a typical pattern when it comes to physical therapy owners? Are they focused on tactics more so? Is there something about physical therapy owners that's unique and that you have to fix even if it's mindset or strategy?
For the most part, physical therapy owners are healthcare professionals. They love to help people. A lot of them are trying to push themselves out of the practitioner role in trying to be better executives and owners. I see that in more so in the physical therapy field than I do in veterinary or dentist. People that are veterinarians or dentists, they love being practitioners. Not that physical therapists don't like being practitioners, but they seem to have the business acumen. They can see what could happen if I get a lot of physical therapists here working under me and I grow this business and I scale it. I can create something that has a mountain of value to it. From a mindset standpoint, I still see a bit of scarcity and some of the decisions that practitioners make. Money is scarce and it’s either this or that. It's never both. A lot of what we're trying to do is trying to make sure that they look at it from that perspective, “I don't have to do this or that I can do both.” How much money does the practice need to produce in order to do that and making sure that I keep my profitability level at a certain amount so I can do that?Money loves attention like a two-year-old at the mall. If you take your attention off them, you have no idea where they're going to end up. Click To Tweet
That's true for most physical therapy owners. There's a scarcity mindset. There's a lot of fear involved in what we do. They also tend to be a significant amount of burnout from what I can tell, so that's why maybe there's that transition out of patient care more so. You don't see a lot of older physical therapists in the profession.
That's funny that you should say that because a lot of the burnout comes from an industry where you're relying upon insurance reimburses. A lot of the reimbursements are going down and the profit is being eroded away. The burnout comes from the fact that there's a lack of exchange there. You're putting all this work and you’re putting all this effort in. You're seeing 10% or 7% profit margins and that would tax me. You can go buy a Puerto Rican bond for 6% and not have the headache of employees and regulators coming in there and saying, “You overbuilt here.” “You didn't code this correctly.” I can see where it taxes and makes a practice owner burnout. Once you solve that profitability issue adding additional services that maybe you didn't before and you get that backup, that's where you see people live it up a little bit.
As you've worked with private practice owners and you've seen them in all kinds of different financial conditions, what are some of the successful actions that they're taking? We talked about the mindset and we talked about strategy. We talked a little bit about tactics. Anything else that you recognize what helps that struggling maybe not struggling? How do those physical therapists improve their financial condition on top of those things?
A lot of it starts with their own personal training. When I say personal training, personal financial education training. Know what some of the basics are of money. Let's not be scared about it. Profit and loss statement is not something that is difficult to understand. That's not even that important to know. You should know about it but knowing some of the basics of money. You need to seek advice from people that are qualified to give it. That's a basic of money. Staying out of bad debt and that would be another basic principle. Things that they probably inherently know but are having a tough time applying. To me, it always starts with making sure that you have your attention on your main money artery.
I call it the main money artery, which is your practice. There's this idea that you have to go out and create all these different income streams that are true for the most part. You definitely want to have multiple income streams flowing into your household. You want to make sure that you have one that's flowing like the Mississippi first. If you can get that one going and setup system, the money then flows to the household to create other income streams. That's probably the most successful action that I've seen. There are some of the most successful owners that I've seen have gotten their practice to a point where it's cashflowing. They set up the system where they take a portion of their business cashflow and automatically every single week set it aside in the household to help create other income streams in the household. That's been the most successful action that we've done with practice owners. If I can get someone to do that, it's game over. They start to feel like, “This practice is starting to serve me as opposed to the other way around.”
I had Christopher Music on and he talked about setting aside 10% of your revenue every month, maybe weekly, but at least monthly. That blew my mind. That's the first time I'd heard that concept and I thought, “If I had set aside 10% of my gross revenues every month for the past sixteen years or whatever I own my clinic, I'd be in a much different situation.” It was cool how he laid it out if you set aside that like it's an expense. Christopher mentions this, you guys mention it. I've read it in Profit First, a popular financial advisory book by Mike Michalowicz. You set aside the Profit First that becomes like an expense line. Inevitably your business grows to meet it.
You have to. We operate with the concept that I know that a business is going to try to spend every flipping dollar that it makes and then some. You know that going in and you see that when you look at practice owners over and over again. I see that pattern. I know business is going to try to spend every dollar that makes. I also know that it will make the exact amount of money it thinks it needs to make to survive. Know those two things, so when you incorporate that 10% as an actual expense and you put it in, you have to do it on a gradient though. If you try to do it too fast, it could cause some problems but if you do it on a gradient, it’s amazing what happens. Things change overnight because you've incorporated that expense. The business thinks it's an expense, but it's simply the accumulation of a reserve pool for the household. If I could tell your whole audience if they did that one thing, they would never regret that ever.
It will change their financials entirely, especially if you look down the road. It's going to be a completely different condition.
Most of the practice owners that are doing $1 million of revenue a year, they're like, “We’ll do the math on that 10%.” “$100,000 a year?” I’m like, “Yes.” When you look at that, that's your owner's compensation. If you're a good owner, that's your owner's compensation. You deserve it. I always tell owners, “If Medicare comes in to audit you, who are they going to audit? They're going to audit you. They're going to audit the practice and you own that.” If you have a lawsuit who gets served. Whose names are on all the notes of any of the practice acquisition loans? It's you. You took all the risks to put this thing there by God, you deserve to get that 10%. That's a reward for you.
Sometimes I have to convince people. It was the funniest thing when we first started, I thought that would be the easiest thing that I could possibly do. I'm like, “There's nobody that would say no to that.” It's the hardest thing to get a practice owner to decide. I knew we were onto something when we started that because I’ve got the most push back when I started saying, “We need to put this money away.” “We can’t do it.” There’s no way.” “There's no way the business is yet too many expenses.” “I can't do it.” We figured out a way that they could do it, so it doesn't cave them in. Once we got that in, everything clicked right after that event for the business owner. It was fascinating.
It's interesting how it also changes the mindset. It changes the energy around the person as you have them focus on their money lines, their lifeblood, their main artery, whatever you want to call it. Once they put their attention on that, the energy changes. They take on the control that they didn't seem to have before and they seem a little bit more focused.
When you do that, it enhances your financial awareness and then it gives you confidence. That's the most important thing in any industry, you have confidence. When you have confidence, you make better decisions. You slow things down a little bit. You control time like an athlete that you see that's competent and what they do, they have so much confidence. They can control time. Most physical therapists are good at doing that from a training standpoint, but on business and an ownership standpoint, they're not as good at that until they get trained to do it. It's establishing financial confidence that does increase your confidence by a high degree.When you have confidence, you make better decisions. Click To Tweet
As you bring on physical therapy owner as a client, is that something you work on them with? What was your typical work look like that might set you apart from other financial advisors?
The first thing that we do is we give them a detailed financial scene that we want them to get to. We define what your ideal financial condition would look like. I don't think that a lot of advisors do that. They'll say, “Let’s save enough for retirement.” They don't give them a clear definition of what their financial condition looks like. We've created a road map where we encompass all the different component parts of your financial life. That’s the thing that differentiates us as well. Your financial life, the body is made up of several different systems. You have the circulatory system, the respiratory system, the endocrine system and all these different systems.
There are nine financial systems that make up your household, from asset protection to estate planning to income planning to debt and credit to tax optimization. There are several different systems and our job as financial advisors is to make sure that all of those systems are operating at their optimum level for every one of our practice owners. Whereas a lot of financial advisors will focus on the investment side. That's 1/9 of your overall financial scene. We put people's awareness on that and say, “Maybe let’s not only look at your investments while they're important. Let's not put all the focus on that.”
I have to say that I work with Econologics and I have enjoyed my experience with them especially compared to other financial advisors that I’ve worked within the past. Simply by the fact that you guys are in communication with me which is typical of the financial advisors that I've had in the past. I wish I had started working with you earlier. To give voice to the first exercise you're talking about. My wife and I went through that, setting a target you talked about $7 million to $10 million. That might seem to be a lofty way out there for some people. You also had us break it down to, “What do I need to be making per month in order to get to those goals?” That gives you a little bit more concrete and current number that can work on. I have that number, and my wife and I have those numbers in our head, “We can have this kind of lifestyle if it makes this much per month, but we can have this much better lifestyle to make this much per month. Let's try to reach for that.” That guides us on a lot of the decisions we're making as much as it pertains to income, investments, and whatnot. That's valuable.
Thank you. When you break it down, I know sometimes we set big targets for practice owners. You will be sometimes a little bit like, “There's no way I'll be able to do that.” When you break it down to like, “We don't have to do all this now.” What can we start? Where can we start? We build upon that. Financial planning is a set of boring repetitive activities. As you continue to do them, you see little mini results. All of a sudden, it’s like, “Boom.” It's amazing how it works. Traditional financial planning is like, “If you put $10,000 away for the next 25 years then you'll have blank amount.” Real-life doesn't work that way. People change, business owners change. Their confidence and business changes. The production of their business changes the industry that you're in. There's so much money pouring in private physical therapy.
There are so many opportunities out there to create a practice that you want to that there's no reason that you should restrict yourself at all. To your point, set big targets and big goals. Let's work backward on what are the actions that are going to lead to get there. When you get the numbers down, it's not that much. It's not that hard. It's not that much and that's where a lot of people appreciate you. You need to have a written plan not only a proposal of, “Let's put X amount of dollars and this investment strategy and X amount of dollars and that and this investment strategy.” That's a proposal. A plan is like, “These are the sequence of actions that I need to take in order to accomplish this.” Most people are operating on financial proposals and not financial plans and that I've seen.
The plan goes back to your ideal financial scene. I want to invest in my children's education. I'm going to have this much at retirement so I can live the way I want. I want to invest in these kinds of vehicles. I want to live mortgage-free. Those are the things that you start from and work on.
That's where it starts. What are the financial goals of the household? Which a lot of people have done. It digs into, how are we going to measure that? That's where I've seen, in our industry there hasn't been a lot of good financial metrics that measure the condition of the households and how we integrate the business into that as well. We have seventeen different financial diagnostic statistics that we look at. We can show someone, “Here's a statistic that you need to look at and we want to improve.” It goes above looking at the performance of an account. It's something that will help someone change their overall condition.
Is there anything else you want to add to the financial stuff that we hardly get into it or what?
I don't even know. This is getting fun.
I know we’ll definitely have you on again, so we have to save a little bit.
For the most part, the keys I want to leave people with is, no matter what your financial condition is, good, bad or ugly or no matter where you're at in your life cycle, whether you're still growing your practice, whether you're mid-career or whether you're thinking about exiting out. You can always do something to change your trajectory. You can always do something to change your financial condition. The sooner that people can realize that their household is the parent company. Make sure that you're wearing that identity of a Chief Financial Officer assuming that beingness, there's a good book called Atomic Habits on if you ever read it before.No matter what your financial condition is, you can always do something to change your trajectory. Click To Tweet
I've heard a couple of people mention it. I need to read it.
The main point of that was, the actions aren't that hard. It's who you have to become if you want to be successful at something. You have to become the identity of that person. Your financial conditions are no different. You have to assume the identity of someone that's responsible with money, that knows how to acquire and control money, and that can expand money. That's an identity. That's the Chief Financial Officer identity. If you can assume that identity, understand that and wear that, the actions are easy. It's not that hard. It's don't spend more than what you make. Take 10% of what your practice does and set it aside, invest prudently. The basics are not that hard. You have to assume that identity of the person that is going to direct this whole thing.
I love that idea because you are exactly where you think you should be. There's an internal dialogue that's always going on. If you assume or if you take on the mantle of, “I am good with my money and my business makes money for me,” then that's what will happen. If you are careless with money and you think, “I spend more than I make. I need to do better with my money.” That's exactly where you will be.
It's 100%. I have created what's called a Chart of Money Attitudes. I don't know if you've seen it or not. Every single day I’ll say certain things to myself like, “I'm a creator of money. My financial decisions are naturally right. I'm fully responsible with money. I want enormous wealth and I want others to have wealth too.” All these affirmations, things that I'll say to myself every single day because I want to make sure that my attitude towards money, which if you want to look at it, this is where it starts. What's your attitude towards money? If you have the attitude of, “I can't have money. Money is scarce. I'm terrible with money. It always disperses,” you're going be bad with money. You need to give yourself a checkup from the neck up every once in a while. When it starts with your money, that’s a key thing. Make sure your attitude, in terms of money, is in good shape and get out of some of the fixed ideas that you have or get out of some of the following gurus and around. You don't need a guru. You need a guide. The attitude comes from other places too, from parents and the experiences that they’ve seen and all kinds of things. We can get deep on this one.
It brings us full circle. It's where we started. It all starts with your mindset and your attitude with money and recognizing that the business works for you instead of you working for the business.
You hit it right on the head.
If people wanted to reach out to you, Eric, how do they do that? What do you have coming up?
We have a three-day training academy for private practice owners. We built our system for private practice owners. We don't work with engineers or teachers or any other of those types of vocations. We work with private practice owners and we built our financial planning specifically for them. We also create a financial planning education system where we teach them the basics of how to increase the value of their business and then how to make sure that they turn those business profits into personal wealth. If they want to contact us you can definitely start by going to our website which is EconologicsFinancialAdvisors.com. You can email me directly at Eric@Econologics.com.
We created 100 question assessments that will give you a snapshot of where you stand in your personal finances. I would recommend that if anybody has any uncertainties, confusion, or I don't know in regard to their personal finances or curious. Everyone's curious about their credit score. What's my credit score? We've created an assessment that will give you a financial score. If people want to go to our website, it's called the Financial Prosperity Index. They could click on to that and it will take them right to that assessment. They can take the assessment. We will give you a free 30-minute strategy session where you can ask us anything you want in the subject of money and personal finances anything at all. As long as you take that assessment, then I'll assure you that you'll get that free 30 minutes or longer depending on how long it takes.
Thanks for coming on. We'll have to have you on again because I know you've got more to share for private practice owners.
We'll keep it on topic next time. We’ve got a lot of different places right there.
It was good. I love it and like I said, I love talking money.
It's all good.
Thanks for your time. Thanks, Nathan.
Eric Miller Has been in the financial planning industry for over 20 years. He’s a co-owner of Econologics Financial Advisors – awarded an Inc. 5000 honoree for 2019.
As the Chief Financial Advisor for the firm, Eric has had the good fortune to have over 10,000 financial conversations with private practice owners in various healthcare industry and helped guide them into a more optimum financial condition using a proven system.