Features Finance Management
Practice Management: Spring 2003

When I acquired my diploma and my registration in massage therapy over 11 years ago, I had an $18,000 student loan, plus various credit card purchases for school supplies. “No problem,” I thought. I’ll be raking in the money from my new professional status. To my chagrin, I soon learned the world was not beating a path to my door. It took time to build a practice. Short of cash, my wife Cheryl and I found it easier to mount things on the credit card. Our cash flow and future purchasing power became choked. We had our first child on the way and I was wondering “how am I going to support my family on a single income?”
I began to address my unhealthy relationship with money.

As I read books about money and spirituality, I realized I had a rift in my relationship with money. I had entrenched beliefs that kept me from developing wealth. My perceptions affected my earning power, and kept me at a distance from generating true wealth.

I came to regret the feeling of living paycheque to paycheque, with no cash flow to buy the things we really wanted. I regretted the “weekly sweat and fret” over the concern of making our bills. I knew I had to change my beliefs about money if I was going to get beyond this life-killing strife.

I imagine many therapists struggle similarly in their relationship with money. We can say, “I don’t do this work for the money,” yet reality dictates that to cover personal and business expenses, plus enjoy some of life’s refinements, we need money to live.

We see our ill-relationship reflected in our business practises, in the limited knowledge we have of financial accounting, or the way we disrespect money through creating debt or undervaluing our services. To cultivate long-term success in our practice, we need to mend our relationship with money.

Pay Yourself First
The first of three concepts I’ll share is the idea popularized in David Chilton’s “The Wealthy Barber.” The idea is that you pay yourself first … before your credit cards, utilities, rent or mortgage, before even the government … you pay yourself first. Chilton recommends 10 per cent of your gross monthly income go towards paying yourself first.

Consider paying yourself first into three pockets – savings, investment and tithing. Savings are put aside for monthly expenses like dinner out, haircuts, clothing, etc. Savings allow you to put money aside for what you want without going into more debt to obtain it.

Investment is savings for your future, and is often housed in the form of an RSP to defer tax. Tithing is apportioning part of your income towards a worthwhile cause such as a charity, church or a community program. There may be no faster way to find new money than to give old money away.

To get started, it is necessary to keep a spending record of all expenses incurred over the month. This process is described in great detail in Jerrold Mundis’s book “How to Get Out of Debt, Stay Out of Debt and Live Prosperously.” You won’t have any idea on where your money goes (a source of great stress I have discovered) until you keep a consistent spending record. When you track your spending, you can turn from waste to wealth.

If your income isn’t enough to support your business and personal expenses without going into debt, then you have two choices – cut your expenses to be suitable for your level of income, or raise your income. Acting on both of these choices will be the most fruitful.

You may say “but I don’t have enough money for my bills, how can I pay myself first?” The truth is, if you don’t pay yourself first, you will always feel enslaved to your expenses. You will feel that every dollar you earn will go to someone else. Realize that the bumper sticker “I owe, I owe. It’s off to work I go” is an attitude that someone else is making the decisions in your life. At the beginning of the month, take a draw and recognize your life as yours to live – not your creditors.’

Invest in Yourself – Personally & Professionally
We’ve all heard about the power of investing a dollar with compound interest over time … each dollar multiplies to give you much more money in the long term than if you just left it under your mattress. I like the analogy that each dollar is a “little worker” that goes out to generate money for you. Ideally, part of the amount you pay yourself first with includes an investment automatically withdrawn from your account each month.

A caveat here … be a smart investor. Educate yourself by visiting any bank’s website or moneysense.ca to learn the difference between savings, income and growth investments. Know the difference between book value and market value before you visit that financial planner – if you choose to use one.

A second side to this concept of investment is to invest professionally. One of the best ways to earn more money is to increase your skills in your profession. I encourage you not to become a “jack-of-all-trades and master-of-none,” but rather pick a stream, a focus, and learn all you can about that method or modality. It should be a specialty you enjoy such as working with women who are pregnant, chronic pain patients, or in rehabilitation for example. Learn all you can, and in no time you will reap incalculable rewards through many referrals.

Some therapists belabour this notion, complaining of the cost of professional development. I draw attention to the first point in investing. If you stand around complaining about the marketplace and never invest your dollars, how much interest will you make?

Invest in your work. Over time your fees will be higher, you’ll gain new patients quickly, and build greater loyalty in existing patients. Now that is good financial sense.

Recognize Money is Energy
In Making Peace with Money, Jerrold Mundis describes the true nature of money. “Money isn’t real – it isn’t a thing like an apple, a mountain or a piece of coal. It is an idea, a symbol. It exists only in that it represents something else, other than itself. The moment it ceases to do that, it ceases to be money.”

We exchange money for goods and services. We earn money by providing value, either through service or in employ of a company. Bill Gates, Oprah Winfrey, or Wayne Gretzky are people like you and I. They attract wealth to themselves by the value they provide. To attract wealth, you must provide service or products of a high value, that the market wants, consistently over time.

Deepak Chopra says in his book, “Seven Spiritual Laws of Money” that money is like blood. It must circulate to remain healthy. If it sits, he explains, it becomes stagnant and pathogenic. It behooves us to circulate our money, to exchange it for products or services, to invest it, and to give it away in tithing. Probably hardest to grasp is the idea that we must be open to receiving it.

I’ve concluded that money is neutral, neither good nor bad. Its effect depends on our intentions and actions in its use. If you’re having trouble in your relationship with money, consider researching the books I’ve mentioned or many others available at your local library or bookstore. As elusive as true wealth and peace with money may seem, you can mend your relationship with money.

Jacob Needleman stated eloquently in Money and the Meaning of Life, “If we are seeking something in ourselves and in our common life, that is both deeply meaningful and unshakably real – then in this time and place, in this culture that shapes us, all right here today, we have no choice but to take very seriously the power money has – not only to seduce us or frighten us – but to show us what we can and must develop in ourselves, that which can never be bought or sold at any price.”