Before opening your practice, it’s critical to review your personal financial situation, your income needs and your cash flow projections. Even if you have paying customers lined up from day one, consider that it may take several months before you receive payment for your services.
Here are some financial questions you’ll want to have answers to:
Here are some financial questions you’ll want to have answers to:
- Do you have cash on-hand to pay your ongoing household expenses and outstanding debts?
- Do you have cash on-hand to cover your start-up and operating costs for your business (Consider rent, utilities, office furnishings, equipment, and salaries)?
- If you’re leaving an employed position, what impact will the loss of your paycheck have on your financial obligations and on your family's lifestyle?
- Aside from savings, equity, and your credit line, what other sources of income can you rely on?
- Can your spouse provide adequate income to handle the day-to-day household bills?
- Do you have a severance package from your employer to help get you started?
- Can you rely on family and friends for financial assistance? Do you need to borrow money from a bank, credit union or other commercial lender?
- Do you have a solid credit history?
- Are you heavily in debt? Will you qualify for a business loan?
- What is your estimated revenue for Year 1, Year 2, and beyond?
Looking for words of wisdom?
Looking for words of wisdom?
“Some entrepreneurs think how can I make a lot of money? But the better way is to think how can I make people’s lives a lot better? If you get it right, the money will come.”
Richard Branson