There is one area that most schools are not able to adequately prepare most future Doctors and Healthcare practitioners for — that is the realities of opening and running their own practice. Setting up accounts, purchasing supplies, running a staff, money management and financial planning are just a few of the very real pitfalls that can sabotage a practice.

If a practitioner could just concentrate on helping their patients all day and not worry about the business end, many doctors would be more than happy. But in a healthcare office there are bills to pay and payrolls to meet, and with the current state of the economy, many practitioners are having a tough time of it financially.

“Over 20 years ago, I became a health care practitioner primarily to help people with their health. I went to classes, took the tests, and graduated from one of the largest chiropractic colleges in the United States as a Doctor of Chiropractic,” says Dr. Brian Dawson DC, author of the book Breaking the Profit Barrier –The Healthcare Practitioner’s Guide. Real pain and sorrow showed up early in my practice when I noticed there was not enough money to run the practice the way I wanted to and still help the most number of patients.”

Like many other healthcare practitioners having financial difficulty with their practices, Dr. Dawson attempted to seek the necessary help in order to salvage his practice and make it financially successful.

“I tried a few practice management consultants along the way which helped with other aspects of my practice, but this problem with the handling of money persisted. It really started to worry me,” he explains. “I didn’t seem to be going anywhere. I felt that I couldn’t reach the financial goals I had set for my practice or for my life. I had all these debts, but nothing to show for it.”

As with many health practitioners faced with seemingly never ending financial issues, the business end of running a healthcare practice began to be more than an annoyance or distraction. The bleak financial outlook began to seriously impinge on Dr. Dawson’s life.

“I have to admit that I was not happy during that time,” he says. “Because I was working just to pay bills, it took the fun out of practicing. I really liked treating my patients but I was usually worried or frustrated because I could not buy the things that I wanted for myself to enjoy life.”

The stressful financial situation also kept the practice from growing. Determined to succeed, however, Dr. Dawson continued to look for solutions that would help not only himself, but also other healthcare practitioners who were having similar business and financial difficulties.

After many years of investigation of various systems, Dr. Dawson realized the real root of the financial problems that many healthcare practitioners faced was one of proper money management. It was not so much an issue of how much money was coming into the practice; rather it was one of handling the cash flow of the practice in such a way that money was properly managed in order to make more money in the future.

“When people hear the words ‘money management’ they sometimes get the wrong idea,” notes Dr. Dawson. “Money management isn’t just accounting or keeping track of the money with billing and accounting software,” he says. “Money management has to do with what is basically a whole new way of thinking about money, cash flow, and finances. Done correctly, money management will put virtually any practice in control of their cash flow and on the road to growing profits stably.”

“The majority of us, even those who have gone to business school, are taught to manage money from a purely accounting point of view,” says financial and money management expert Sandra Simmons. “Accounting software is merely a look into the past and shows you where the money has been spent. True money management forces you to look into the future and invest in those things which are making you money. The correct money management point of view will get you to plan and predict how much income you expect for the week, and then set your budgets accordingly. It really is a forward looking point of view that puts the healthcare practitioner much more in charge of his or her financial future.”

Healthcare practitioners who use proper money management techniques have found that suddenly they feel much more in control of every aspect of their finances. Debt is rapidly reduced or eliminated, bills are paid in a very definite manner, and money is set aside to begin the process of building wealth for the practice.

Dr. Dawson actually combined forces with Sandra Simmons to form a company called Money Management Solutions. The company was specifically formed to help health practitioners, and business owners of every type to provide easy and workable financial solutions that they could use to resolve their financial situations.

Dr. Dawson and Ms. Simmons provide money management counseling services to those healthcare practitioners and business owners who would like individualized help. To that end, Money Management Solutions has an impressive track record of successfully turning businesses around so that they are well on the road to wealth and prosperity.

Knowing and learning how to run a business and performing the correct kind of money management practices can be a daunting task, Simmons and Dr. Dawson decided to automate the money management process to make it as easy as possible for businesses to get back on track.

“So after years of work, I helped launch our Money Management Business software,” he says. “As a Chiropractor, I knew that we had to have a software program that was going to be very easy to learn and use, so we’ve taken great care to make the information very user friendly and easy to understand. Most Doctors will find that they are up and running in a very short amount of time.”

Dr. Dawson is quick to point out that the money management software program is not meant to replace your current bookkeeping program, such as QuickBooks®. He emphasizes that it is definitely not billing software or an accounting program. It is a unique, one-of-a kind-money management program that works in conjunction with your bookkeeping program to put you on the road to financial wealth and success.

“You can learn to use the software program in less than 1 hour by watching video tutorials built into the program,” he says. “It is very easy to implement? You just fill in the blanks. You don’t have to think about it. The software does it for you. There is a simple interactive flowchart in the program to guide you all the way through each step. We’ve really tried to make it very user-friendly.”

In conclusion, Dr. Dawson promises that healthcare practitioners will see how easy it is to have more than enough money to meet your financial obligations and put the fun back into your practice. The software was specifically designed so that healthcare practitioners and business owners would not have to think about what to do with their money because the computer program does the money management and financial planning for you.

So, if you are a healthcare practitioner who is looking for ways to improve your practice, build wealth, achieve financial freedom, and devote more time to treating your patients, you owe it to yourself to find out more about money management solutions.

“I know about the challenges in the health care field,” states Dr. Dawson with great sincerity. “This Money Management software is my contribution to the Chiropractic profession to make these challenges become smaller, and make your purpose as a successful health care practitioner to grow larger each day so you can have more fun and help more patients!”

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For more information about money management or help with your healthcare practice, contact Dr. Brian Dawson, DC at 727.448.1011 or e-mail him at Brian@MoneyMgmtSolutions.com. To learn more about Dr. Brian’s Book for healthcare practitioners visit http://www.briandawsonbooks.com/

I find I cannot withhold my comments any longer on this topic of budgeting software. I see too many articles that pretend to be about budgeting software when the author knows nothing about what the word budget actually means. I don’t like it when incorrect information is served up to the public.

Here are some examples of what I find offensive:

A recent article posted on the internet states that “Budgeting software is a computer program that creates a profit or loss plan from data entered into the software. Some of the data to be entered may include earnings and expenditures.” Sorry, but that is NOT budgeting software, that is accounting software.

The correct definition of the word BUDGET is: the amount of money it takes for the organization or household to function, and to attain its goals.

Here’s the good news: living on a budget does not mean you have to cut back on the quality of the things you buy or deny yourself anything fun. What it does mean, is that you have to figure out how to make enough money to afford the things you want, now and in the future, and to keep your spending within the limits of your income.

Therefore, a correct budget is partially a computation of what you have spent in the past and partially a calculation of how much money you will need for specific items in the future to achieve your financial goals. Budgeting is a useless activity unless you use it to do income planning and spending planning. Accounting software does not do that for you. It only records what happened in the past and cannot help you predict the future or plan future actions.

That same article states, “There are many different types of budgeting software…” I challenge the author of that article to name three or four budgeting software products on the market that are not, in fact, accounting software. I can name one; Money Management Solutions, and it is NOT accounting software, it is what its name implies, money management software.

And yet another useless statement pretending to be good information is this one from that article, “Any sort of budgeting software can be used to keep track of a personal budget…” Well, it is a useless activity to keep track of a budget, unless you add the useful steps of using the information to plan your financial future and manage your money in a way that guarantees you will achieve your financial goals. Just keeping track of what you spent is a waste of time, unless you use it as part of the whole money management equation of planning the steps to take to reach those goals.

And finally this statement which has nothing to do with budgeting software, and everything to do with accounting software, and so becomes a misrepresentation of the facts to the reader, “Money management software is some of the most comprehensive software on the market today. Products such as Quicken and Microsoft Money will keep track of individual account information with various types of accounts such as checking, savings, and investments. These programs can also track credit card spending and alert you when you have overspent on your monthly budget.”

In fact, Money Management Software is PLANNING software which is used to plan and execute the actions you can take to reach your financial goals. Therefore, you won’t need an alert that you overspent your budget; you’ll know BEFORE you are going to overspend and make the necessary adjustments so that doesn’t happen. Accounting software, like Quicken and Microsoft Money, is RECORDING software and can only tell you what happened in the past.

Making financial decisions for the future based only on what happened with your money in the past is a dangerous activity. For example, if you read an article in Money Magazine that is raving about some stock that had double digit increases over the past 5 years, and you bought that investment based only on the record of past performance, you could lose your money the next day.

What should you do BEFORE you make that investment decision? You should do your own research into the stock and make an investment decision based on YOUR belief that the future plans of that company will continue to deliver double digit increases.

Bottom line, don’t believe everything you read about budgeting software that is really accounting software. Accounting software serves its purpose to record what happened so we can file our tax returns. I use it myself. If we ever get the FairTax passed and we don’t have to file tax returns any more, I’ll still use my Money Management Software because it is my planning tool to make sure I stay on the road to achieving Financial Freedom.

Can You Help Me Turn Around My Construction Company?

Service professionals like construction companies can find themselves in the financially tough position of running a lot of projects, but still barely making it financially. Without proper money management strategies and control of their financial planning and cash flow, a general contractor can actually find themselves in financial difficulty with declining profitability and increasing debt.

The following money management strategies illustrate what construction companies and general contractors can do to improve their financial condition and put their business back on the road to wealth and prosperity.

In May 2007, a construction company called me for help. Despite the mortgage loan debacle, the construction industry continued to be strong in Louisiana after Katrina. However, this company was behind on all of their projects, had no operating capital and had accumulated a lot of debt trying to keep the business afloat. They need a FAST turn around in order to survive.

The challenge was to raise income to keep projects moving ahead, placate materials suppliers and subcontract labor, cut runaway expenses, close sales on new projects and deliver the jobs profitably, while reducing a six-figure debt liability as fast as possible.

Money Management Strategy # 1 – Raising Income & Profitability

Behind the 8-ball, the company’s biggest challenge was to raise income to fund projects to keep them moving forward. Recent project draws from funding banks had been used to keep earlier projects going when money got tight and delivery of projects was coming to a standstill. The income statistic had crashed and personal savings had been drained to try to stay afloat. The debt load had grown to 6 figures.

The Money Management Solutions software program was implemented immediately, and a special “Income Planning Drill” was done with the client to determine what the major problems were. As part of the drill, an evaluation of profitability was done on projects that were running in negative profits. An analysis revealed that the company’s construction crew was making costly mistakes that had to be corrected at the company’s expense. To make matters worse, having to correct poorly installed doors and windows often ruined the materials. Replacing costly materials was an extra drain on the company’s bank account.

Many of the highly skilled construction workers had left the state when Katrina hit, never to return, or to return to locations further from the coastal areas. Less qualified workers were hired both to save money and because they were available for work. In the long run this cost the company more because job mistakes had to be corrected at no additional charge to the client.

The worst effect of this was the owner of the construction company was spending all his time doing quality control checks and correcting and re-working jobs, so he had little to no time to work up bids on new contracts. No bids meant no new projects.

The existing construction crew employees were replaced with half the number of new highly skilled crew who could get it right the first time. One of these had experience as a job foreman, and he was given that hat. Despite the increase in the hourly pay for the higher skills, the work was done correctly and faster than before on existing jobs. This freed the owner up to work up bids and close contracts.

In addition a new company policy was implemented, and bids for new jobs were confined to commercial projects which generate more income than residential jobs.

Money Management Strategy # 2 – Slashing Expenses

With jobs being done right the first time the cost of materials dropped dramatically, but cash was still very tight and materials suppliers who were owed a lot of money were complaining loudly. Money was so tight that one of the weekly financial planning actions was to look for things we could sell quickly to raise cash to buy materials. Now, a construction guy would rather die than part with any of his tools or his truck; but here’s what happened.

The owner walked his property and found a riding lawn tractor he could sell. The cash went to pay a supplier. That wasn’t enough for me, so I asked about vehicles. It wasn’t easy, but the sale of the second pickup truck the owner rarely drove was agreed upon and that cash was used to pay suppliers as well. I asked the owner to walk his property and see what else he could find. Sitting in a shed were some very expensive doors and windows he had forgotten about from a project done long before. They happened to be from one of the suppliers who was making threats. The doors and widows were washed clean of accumulated dust, loaded onto a truck and delivered to the supplier for a healthy credit on the bill owed. That was a real win for all of us!

The company had not had good luck with hiring competent bookkeepers, so a good replacement was found and trained on the Money Management Solutions software system. She was easily able to input the information into the MMS software program to prepare for my weekly planning meeting with the owner. The accounting chart of accounts was cleaned up and simplified, and the correct entry and reconciliation of credit card statements was implemented.

Just by having the accounting cleaned up and entries corrected allowed the owner to view a correct Profit & Loss statement and review past job profitability. Each line item was reviewed and red-flag items were investigated. The spending faucet was turned off in some areas and turned down in others so available income could be used to maximum advantage to buy time and move current projects forward while income and profitability was being strengthened.

Money Management Strategy # 3 – Turning the Ship Around

With projects moving forward the owner was freed up to spend his time working up bids and closing new contracts. One area that was a drain on profitability then came to light. Past bids were hurriedly prepared due to lack of time, suppliers were not called for current prices, old pricing was used to make up the bids and the increased prices of materials were missed. Consequently jobs were bid with little profit built in.

A new policy was implemented to get current materials and labor quotes before writing a project bid with clauses to cover unforeseen materials increases. With the owner getting price quotes good for 30 days from suppliers and writing bids that were profitable, the cost of materials was adequately covered and that drain on profitability was stopped cold. The bids on the more lucrative commercial jobs that were closed opened the income faucet and the ship started to turn around.

Money Management Strategy # 4 – Putting the Owner Back in Financial Control

Using the money management software, funds were allocated to job materials and labor on a weekly basis which kept projects moving. Funds were also allocated to past due bills while keeping up with current operating expenses. That kept suppliers happy. A set aside account for cash reserves was funded weekly to cover unexpected emergencies.

The company owner had plenty of time to work up bids and close projects. He landed several big contracts and sold a spec house he had been building which enabled him to pay off a large chunk of debt. Faithfully following the money management system, the weekly financial planning meeting included income planning for closing new projects out on bid, promoting for new projects, and allocation of funds to keep digging out of debt, keep current projects moving, and paying current operating expenses. Here is what the client had to say about the Money Management system:

Less than 3 months ago the likelihood of paying off a huge debt without borrowing money seemed impossible, much less figuring out how to continue running our business without any money, except what we were making week to week. Our stats [production statistics] were down, the quality of our work was poor, jobs were not profitable, acquiring new contracts was at a stand still and we were BLOCKED.

Using Money Management Solutions, with help from Sandra Simmons, we did our financial planning faithfully. It brought us understanding of what caused our financial difficulties in the first place, peace of mind through a very stressful period, and the ability to get through each week with a plan of action that allowed us to systematically work ourselves into a better condition in just a short three months. Now the contracts are flowing in, we have qualified personnel, great profitable work, haven’t had to borrow a penny to pay off debts and now have a very simple and workable technology to flourish and prosper, which we are.

Using the Money Management software in this construction company, the weekly allocation of income included percentages to pay for job costs, reduce debt, pay regular expenses on time, promote the company and even set-aside funds for a long-term retirement savings plan,” she says. “The increase in income from cost cutting measures, promotional activities and weekly income planning was immediate and profitability was on the rise.

The success of the plan was driven by owner’s decision to fully embrace the money management program and keep the discipline in. Once that decision was made, the rest was easy. As part of the plan, statistical graphs are being charted weekly and the decrease in debt and increase in cash reserves are proof that the weekly planning continues to work. Keeping the action in to keep a tight control on job costs, raise income and pay off debt is handled in less than an hour each week using the money management software, and the company owner spends the rest of the week with his attention on writing bids and closing projects.

He isn’t worried about the money any more and he’s having fun doing what he loves to do, constructing new, beautiful buildings. He actually beat my 8 month estimate of how long it would take to turn the company around by a couple of months. That is a testament to the power of the money management software program when it is kept in and used as intended.

If you would like a consultation regarding your construction company or general contracting company, contact Sandra Simmons at 727-448-1011 or email her at info@moneymgmtsolutions.com .

Money Management Solutions: Dental Practice Case Study
Financial and money management expert Sandra Simmons describes how she was able to assist a dentist to handle debt and put him on the road to wealth and financial freedom.

Financial Difficulty: How do I fix my declining profitability and rising debt?

A dental practice I worked with was actually doing well, but expenses were out pacing income on a business level as well as the personal level for the practice owner. With almost $3 million per year in revenues and $1.5 million in debt the practice was just keeping its nose above water.

The challenge was to raise revenue, cut expenses and pay down debt at a rapid pace, while reducing the practice owner’s personal tax liability from 40% to a lower level.

Money Management Strategy #1: Cutting Expenses

The first action was to create a budget in the Money Management Solutions program to find out what it was costing to run the practice on a weekly basis, and where expenses could be cut.

Once an evaluation was done, the big culprit in rising costs turned out to be the dental supplies. There was no formal ordering procedure, and staff were shopping the catalogs and ordering whatever they wanted. To get this under control, a two-pronged plan was developed.

The first action was to institute new ordering policy. A self-carbon internal requisition form was designed for staff to request supplies be ordered. All requisitions are routed to the owner’s wife for review against on-hand inventory and other requests. The carbon copy is sent back to the staff member requesting the supplies with a notation of whether the request has been approved, approved with modifications, or disapproved. Ordering is now handled by one person rather than everyone ordering.

Second, a complete inventory of supplies was ordered, and excess inventory found tucked away in drawers and cabinets was scheduled to be returned for credit. This alone saved a substantial amount of cash.

Money Management Strategy #2: Raising Revenue

An income planning drill was done to identify areas of the practice that were non-viable, discover what services were profitable and easy to deliver, and discuss what new products or services could be added to raise income profitably.

The dental supplies were examined again to find out if the suppliers had raised their prices. Several vendors had increased prices and the retails needed to be adjusted in the dental practice.

Next, to address the 8 – 12% annual increase in the cost of doing business, the services were reviewed to see where prices could be raised without causing undue upset with patients. It was found that prices had not been raised on some items for over a year. Several services were raised immediately and yet were still competitive in the market. Lost income from keeping retail prices stable is a common mistake business owners make. Every consumer knows that the cost of living and doing business goes up each year. They are rarely surprised by price increases.

The Doctor/Owner was scheduled to get trained on a modern procedure that he had been wanting to learn for quite some time. The new procedure was determined to be “where dentistry is headed in the future” so the modest training cost could quickly be recovered within a very short time after introducing the new service in the practice.

The staff bonus system was based on revenues that were too low for the practice to be viable. The bonus system was revamped with a new, higher “break even” target set to qualify for bonuses. In addition, a bonus game was added whereby all staff and their spouses could play to win a group trip of their choice.

The promotional activities were evaluated to determine whether they were producing a good return on investment and where costs could be cut while improving response. Changes that were made included adding a monthly email newsletter to all patients. Here is what the practice reported after the first newsletter went out. “I had to send you our first e-mail newsletter. We already have gotten responses!”

Money Management Strategy #3: Reducing Debt & Implementing Long-Term Savings

Using the Money Management Solutions software, the weekly allocation of income included percentages to reduce debt, pay regular expenses on time, promote the practice and set-aside funds for a long-term retirement savings plan.

The increase in income from cost cutting measures, promotional activities and weekly income planning was immediate and profitability was on the rise. A mere 3 weeks after implementing the Money Management Solutions program, here is what the practice owner had to say, “Thanks for ALL the tips. We are putting things in place and already seeing results!”

Money Management Strategy #4: Setting the Course for the Future

In a few short weeks the practice was turning around and headed in the right direction. The regular weekly planning using the Money Management Solutions software maintained tight controls and the practice owner could clearly see that this was painlessly helping the practice stay on course toward a bright financial future.

The key to the success of the plan was the practice owner’s decision to fully embrace the Money Management Solutions program and keep the discipline in. Once that decision was made, the rest was simple.

Statistical graphs are being charted weekly and the decrease in debt and increase in cash reserves are a validation that the plan is working. Continuation of the actions taken to keep a tight control on costs, raise income and pay off debt is handled in less than an hour each week using the Money Management Solutions software, and the practice owner spends the rest of the week with his attention on treating his patients. He is sleeping well at night, no longer worries about money and is having fun in his practice again.

My estimate of how long it will take until the practice is free of the $1.5 million debt…14 months, provided the Money Management Solutions program discipline is kept in and used as intended.

You can speed things up considerably by using the tips in Dr. Brian’s new book Breaking The Profit Barrier – The Healthcare Practitioner’s Guide so check out the book!

If you would like a money management consultation regarding your dental practice or business contact Sandra Simmons at 727-448-1011 or email her at info@moneymgmtsolutions.com .