My RD Journey

From Undergrad -> Internship -> RD -> Private Practice!


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Setting Income Goals – Billable vs. Non-Billable Hours

Hey there! A few weeks ago, I posted about setting fees in your private practice. As a follow-up to that, I wanted to break down how I determined my monthly and yearly income/expense benchmarks. This is just my way of setting income goals and it is by no means perfect. I am not an accountant or even have a business background, just a dietitian running a private practice and learning things as I go! You don’t necessarily need to do every step listed in every order, again, I am just posting this as a guide for my fellow private practice RDs and RDs-to-be.

Step 1a: Figure Out Your Personal Expenses
I separated my expenses into business and personal, but since I am self-employed, both get factored in to my equation. I found it easiest to figure out what my expenses were per month and then times that by 12 to get the yearly expenses. Any expense that was paid yearly (car insurance, etc), I divided out to see what a monthly average cost would be. My estimated monthly personal expenses ended up totaling $1470, which brought my yearly personal expense total to $17,640.

Examples of personal expenses: food, living (rent, utilities), medical (bills and medications), car-related (gas, inspection, etc), gym membership, phone bill, etc. I also added in here an extra $100 for miscellaneous expenses (i.e. gifts, clothes, etc).

Step 1b: Figure Out Your Business Expenses
Many of you who have been following me the last year or so may know that I do primarily in-home counseling and some work-site counseling. I don’t have any overhead for office space rentals, etc. I just wanted to throw that out there since my monthly business expenses may seem a bit low. My estimated monthly business expenses ended up totaling $400 initially; however, I did have to add in health care costs since I pay for my own insurance now. That brought me up to about $700/month for business expenses.

Examples of business expenses: office supplies (ink, paper, etc), travel/parking for classes/counseling, cooking class materials, referral fees, memberships, business banking fees, health care, liability insurance, faxing services/machine, etc.

Step 2: Figure Out Yearly Income 
Right off the bat, I know that I need to make at least $26,040 to cover my personal and business expenses (monthly expenses x 12). I also wanted to be able to save some of my income and not just live paycheck to paycheck. When I first figured out my desired income, I settled on $40,000 for the year. This level of income would cover my expenses + estimated taxes. For estimated taxes, I averaged about 15.3% being paid towards federal (SS + Medicare) and about 4% for PA tax. I rounded this up to about 25% just to cover myself. With taking out about $10,000/year for taxes and $26,040 for expenses, that left me with about $3,960. This number could vary in real life since I overestimated for expenses and taxes. Also, when doing taxes for the year (or quarterly), you do get some tax breaks for being a business owner and a lot of my expenses were write-offs. Regardless, I still wanted to have a rough estimate to figure out my income goals. If you wanted to have $40,000 be what you would see after taxes, just do the following -> ($40,000 x 25%) + $40,000 = $50,000. You could also think to yourself that you just want to make ends meet. In that case, you could do the following -> (Yearly expenses x 25%) + Yearly expenses = Desired yearly income.

Step 3: Figure Out Monthly Income Goals
One easy way to figure out monthly income goals would be just to divide out your desired yearly income by 12. Still using the $40,000, that would be $3,333/month. With $50,000/year that would be about $4,167/month. From this point, there are a lot of ways you can figure out client goals; however, below I list just two of them. Before I get into that, I just want to point out that you will need to think about what is considered billable versus non-billable hours. You may work a 40-hour week and end up only being able to bill for 20 hours of that. Billable time is what you are getting paid for (i.e. counseling appointment time, class time, etc). Any office work, emails sent, time prepping for an appointment, etc may not be time that you can necessarily bill for. So, when thinking about client goals just know that this is the billable time or amount of time in which you receive payment for services.

Step 4: Figure Out Client Goals (Option 1)
Let’s say you have an income goal of $3,333 per month, this breaks down into a weekly goal of about $833. If you only have 8 hours available for billable hours (i.e. 8 hours to see clients) then this means you will need to charge at least $104 per client and see at least 8/week ($32/month) to be able to reach your desired income goal. If you don’t take insurance and you already know that you charge $120/hour, this cuts the number of clients you see per month to 28 versus 32. You can think about what your time is worth and determine a rate for counseling or general services that is even higher and ends up cutting down on how many hours you need to spend doing things that count as “billable.” If you accept insurance, you are bound to the fee schedule that they set for you. So, if you get reimbursed $120/hour for initial appointments and $108 for follow-up appointments, you may need 10 initials and 20 follow-ups to hit your monthly goal.

Step 5: Figure Out Client Goals (Option 2)
If you do more than just provide counseling services, you can use this option to determine client goals. Working with the $3,333 as a monthly income goal, let’s say you run cooking classes or a nutrition class every month. Let’s say you make $800 per month to run this class 3 times. This leaves you with $2,533 ($3,333 – $800 class) to still make for the month. This could mean about 24 follow-up appointments at an average of $108/hour or it could mean 5 initial appointments at $120/hour and 18 follow-ups at $108/hour. Although this seems like a lot of numbers and scenarios, it helped me to figure out how many clients I wanted to be able to see per month. Once I figured out a client goal number, I worked on a marketing plan. I mentioned in my last blog post that I wanted to work on more programs and content versus services. I love what I do as a dietitian; however, I find myself working a lot and only being able to bill (I accept insurance) for a portion of that time. I want to free-up my time and still hit my income goals, which would mean decreasing the “service” portion and increasing the “product/program” portion.

Step 6: Overview 
In summary –> Desired Yearly Income (Factoring in Business + Personal Expenses + 25% for Taxes) divided by 12 months = Monthly Income Goal. Another option = Desired Yearly Income divided by 52 weeks (or 50 if you take out a week for vacation and another week for sick/personal time*) = Weekly Income Goal. From your monthly income goal, you can determine how many billable hours (and ultimately clients or classes) you will need to reach this. It really helps knowing your hourly rate.
*Normally, with being employed, you may get paid for personal, vacation and sick days. If you are self-employed and offer a service, if you don’t provide the service you don’t get paid.

As a way to check my progress monthly, I created two sort of “snapshot” documents for my finances. The first is the yearly look at my total income, total expenses, and net profit. I made this so I can see where my peak months are for income. The second document I created was for my monthly overview. I tracked the number of appointments (scheduled, cancelled, re-scheduled), classes ran, business and personal expenses, and total income received from both classes and counseling. I also include how many miles I drove that month for business. I was using apps to track my expenses/income before; however, I really like having the paper copy to just have it all laid out in front of me. I just recently got Quickbooks and I really love it, but again just like having my own sheet that makes sense to me.

I hope this blog helped you at least a bit in figuring out your own income/expense goals. As someone who doesn’t have a background in finance/accounting, I wanted to just be able to share my process for setting income/client goals. Leave a comment and let me know what other resources have helped you with figuring out finances. I hope to post my snapshot documents on my website; however, if you wanted a copy to get you started, shoot me an email 🙂


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4-Month Practice Recap – Self-Employed Vs. Employee

This blog post was originally going to be all about setting income goals and figuring out billable hours; however, as I approach my 4-month self-employed, private practice milestone, I had something different I wanted to share first. This revolves around mainly how I left a “9-5” employee job for a 9-7 if not 8-7 self-employed private practice. Was it worth it? Of course and I would do it again; however, I did come to realize a few things this past month that are going to redefine how I do business in the future.

When I first thought about private practice, I didn’t think it would end up being something full-time. Sure, I would have absolutely loved to just be doing my practice; however, I just didn’t see that as being realistic. I was certain I needed the traditional path of jobs to be successful. After a few years, I began to see that full-time private practice was definitely realistic and coming faster than I had imagined. Now, let’s flash-forward to when I was deciding to leave my full-time employee job. I debated with myself A LOT in the months leading up to my quitting. Would I make enough money? Would I actually like what I was doing? Would I get overwhelmed? I was someone who was ingrained with the idea of making money and saving for a future. Not that this was at all a bad thing, but I was fearful that I wouldn’t be saving and would instead drain the savings I had been building for years.

With those thoughts in the back of my mind, I still quit my job and was quite successful being a private practice business owner. My income surpassed what I was making being an employee, I was flexible enough to be able to spend time with my family whenever needed, and I loved being able to choose what I was doing. So, this doesn’t seem so bad at all, right? To be honest, my success was largely due to stretching myself beyond capacity, taking paying gigs whenever possible (even if they were at lower rates than I wanted) and seeing clients even on the days when I wanted to just focus on office work. I wasn’t spending time on creating products for my lesson plan store. I wasn’t spending time on making YouTube videos. I wasn’t spending time on writing a book. I was just working to make money (and of course because I truly like what I do). It was at this point that I realized that I couldn’t add more to my schedule because the time just simply wasn’t there. I also wasn’t adding in the pieces of my business that would be a source of passive income, thus lightening up my day-to-day workload. I was still bound to certain time constraints for classes or counseling for income and low and behold, that cut my flexibility in half.

After a long chat with my beyond supportive boyfriend, I set goals for myself to cut the fat out of my business. My time was more valuable than what I was being paid for some classes and that needed to change. I also needed to actually set and stick to a schedule where I would only see clients and have classes on certain days. I stopped trying to join various committees and groups to network or invest my time in (for free). I stuck with the organizations I was already in and set boundaries for myself as to how involved I would be. I needed to block off time for content/product/program creation. I refused to be a slave to my own business anymore.

So, why I am I sharing all this with you? Well, for me, the easier route in private practice was to just go out and make that quick money. It was the instant gratification and certainly short-term. What was harder was investing (or starting to invest) my time into what would turn into a long-term income source. This long-term income source would free up more of my time so I could actually enjoy being self-employed. I could get back to more of my hobbies without feeling guilty that I wasn’t working on the business. I could spend more time with my family without bringing work along. I could invest more time in personal development and enhancing my skills as a Dietitian. The positive side of this was simply endless.

If you ever get to this point in your practice, think to yourself what you truly want in being self-employed. Do you want to work like crazy for the goal of not having a boss or company telling you what to do or do you want to have more flexibility in what you do on the day-to-day, while still making money through passive income sources? Once you think about what your long-term goal is, break it down to determine short-term goals and plan your schedule around that. It is so easy to get sucked into the work and make money thought process; however, this process can be simplified, streamlined, and more so minimized to create more time for yourself. In the end, isn’t that what we all want…more time?

To sum up this lengthy blog post, I want to say that when I think about my future, I want that future to include more time for myself, my family, and eventually my kids (I don’t have any now). I don’t want to be forced into 8 or 10 hour workdays to make enough money, even if it is on my own terms. This post is by no means me saying that if you want the traditional private practice that it is in some way less ideal or wrong for you. The beautiful thing about private practice is that YOU can create the type of business structure that will suite YOUR needs above anybody else.

So, leave me a comment and let me know your thoughts on this topic. What does your ideal private practice look like? What does your ideal workweek entail?

Stay tuned next week where I will be sharing my thoughts on how to set income goals and defining billable hours!


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My First Month – What Does Success Look Like?

It has been just about a month since I decided to leave my full-time job and grow my private practice. This week has been a bit weird for me since it is the first without my intern (aka it is just me…and my cat…all day long). I forgot how much random chit-chat filled the days! Even just driving with someone else and reviewing the morning’s class was something I really missed.

Since we are almost to the New Year, I didn’t have a lot of appointments scheduled for the week and I was being to feel a business slump. I started thinking, “Why are you doing this” and “What were you thinking leaving your full-time job” I mean no business means no paycheck! Once I stopped letting my emotions get the best of me, I realized that it is completely normal to have a slow down during this time (it happened at my previous job). I also realized that I will be “making up” for this in January and February when I had more appointments.

I have been reading “Tools of Titans” by Tim Ferriss this week and one of the biggest things that struck me was actually in the first couple of pages when Ferriss had been asking someone what they thought of when they heard the word “successful.” Success. That was the key that I had been missing and what I needed to think about to change my thoughts into more positive ones. The goal I always wanted was to be in full-time private practice and I had accomplished that 4-weeks ago. Now, I wasn’t sure what my new “success” looked like. Sure, I wanted to build partnerships and gain clientele; however, I wasn’t envisioning my practice in the next month, year, or decade. While I haven’t quite figured out what my vision is for my practice, I know once I determine that that my efforts will feel like they have more purpose and I am not just spinning my wheels so I don’t fail.

What Else I Have Learned

Get ahead when you have downtime – What did I do the past few weeks with limited number of appointments? I followed up on headaches (like insurance calls), planned out my Facebook posts for my page, and set a schedule for myself. I already know that January/February is going to be a lot busier for me than December was, so I planned some of the menial tasks now to get them out of the way.

Track your expenses – I also took some time this month to review my yearly finances. It really helped me to set practical goals once I determined what I needed to make to break even and then what I actually wanted to make. From that, I figured out how many clients I needed to see per month to reach my financial goals.

Google Docs/Drive is awesome – I have been using this for minutes for committees I am in and it is great! I also started tracking my mileage on a Google Drive spreadsheet instead of writing it on paper. I feel like this helps to streamline a lot for me since I can access it on the go.

Nothing is really a disaster – Last week in my cooking class, the building’s power shut off due to a Septa issue and Peco needing to do an emergency shut off to fix something. So, to paint you a picture of this, I am making a soup for class and I have most of the ingredients prepped so I can just dump everything in the pot to cook in time. I also planned on making veggie chips with my mandoline. Oh, and this is 20 minutes before class is supposed to start. I was told to try and talk through the recipe so people felt like they got something out of the class when they arrived. I am pretty good on my feet; however, I was thinking to myself how am I going to take up 1-hour of time talking and not making anything (with no back-up food). What did I do? I made it fun, because what else is there? I told the class to pretend the onions were sizzling and I had them “smell” the lovely blends. You learn a lot about yourself while doing a “cooking” class in partial darkness (only emergency lights). Fast-foward a bit and the power returns mid-way through the class, I speed up the recipe, and everyone got to eat and enjoy the soup/chips. I got so many compliments on how I handled the class in the dark and I felt awesome. So, that was one for the books.

What I am Still Working On

-Not letting work consume me or stress over thinking that I am not doing “enough.”

-Not over planning so much that I don’t actually do anything but plan.

-Figuring out “office hours” (aka what is my cut-off time for answering calls and emails?)

-Spending some time de-stressing with meditation, playing the piano, or exercising.

Hope everyone has a great New Year! I am excited to see what 2017 has in store 🙂

Check out my previous blogs to see why I made the jump to private practice +  Weeks 1 and 3 🙂