How to reduce financial risk and transition out of your current jobFeb 13, 2023
The financial implications of owning and operating a business can seem overwhelming and straight-up daunting. You might even have a nice cushy job, great coworkers, and a consistent salary, but you already feel the ceiling approaching.
Exploring the next steps, you’re looking to take on a management position, but that really means all the business responsibilities fall on your shoulders without the upside, not to mention a minimal pay bump.
So why not bet on yourself?
The goal of this exercise is to show you that the big risk you’re perceiving isn’t really that risky.
Before we dive into anything further, we need to understand that risk tolerance lives on a spectrum. Some people stay safe with a salary and stability, and some people quit everything and go all-in. Neither option is right or wrong because buying into the risk strategy that works best for you will give you the highest chance of success to transition.
Quiz yourself on a scale of 1 (minimal risk) to 10 (high risk), where do you fall?
If you’re below a 6, I think this article is going to be geared more toward you.
According to Zip Recruiter, the average salary for an outpatient orthopedic physical therapist is around $82,500/year which equates to about $39.67/hour or $6,875 per month. These numbers are important because we want to see how quickly we can replace them. If you’re under this number, consider the risk that your current job is COSTING you money. This is a massive mindset shift.
Low-risk tolerance strategy
To implement a lowest risk tolerance strategy, we need to keep our overhead (expenses such as rent) low. This means there’s minimal to nothing going OUT, but we get to keep whatever comes in. When I first started my side hustle, I was pitching my value to the gym I was treating out of as my payment. Yes, that’s correct, $0, because I was able to save them money by helping with their retention (aka, not losing clients).
My recommendation here would be finding a facility that has your ideal client in it (mine was CrossFitters, so I chose a CrossFit gym) and setting up shop here, even if that means just investing in a fold-up table – remember this is a low risk strategy but still requires SOME investment!
Next, you need to determine your working hours. This might be a nights and weekends strategy - again, short-term sacrifice for long-term gain. Now you know how much capacity you have, let’s call it 10 available hours per week.
Time to get to work.
Pricing your sessions
The number 1 thing that delays the transition process for most people: pricing their sessions too low. You’re a doctor, you deserve doctor compensation. $200/(hour/session/visit) is a great starting point.
Now some simple math, how many sessions do I need to sell to replace my salary?
Monthly earnings of $6,875/$200 = 34.375 visits (rounded up, that’s 35 visits per month). Now divide 35 by 4.3 (average number of weeks in a month), 8.14 visits per week. Rounded up to 9.
You need 9 hours of clients per week to replace your 40-hour work week! You’re probably thinking, but I only have 10 extra hours of capacity… Sure.
But do you need to fill that before you transition to part-time? Can you pick up a pm job that gives you a balance of safety and doesn’t monopolize your entire day? I personally worked in a skilled nursing facility making $50/hour to bridge this gap (that’s a story for another day).
You’ve got options, and it’s time to explore them.
Now let’s say you wanted to see the rocket fuel version of the low-risk tolerance strategy.
Instead of selling visits, you’re going to sell the entire plan of care, let’s call it 10 sessions for $180/session, giving a bulk discount for the commitment to the process and locking in collected funds for you.
Now instead of needing to sell 35 sessions, you need to sell four plans of care to replace your SALARY!
MUCH more attainable in your mind, I’m assuming.
Want to level up and add a digital offer, let’s say conservatively for $300/month, assuming you can get three clients to buy, you now have recurring revenue as follows: $900 month 1, $1,800, month 2, $2,700 month 3, $3,600 month 4, $4,500 month 5 (and growing).
I’ll admit, this takes a simplistic approach to the process, there’s a lot of work involved. But the goal isn’t to fluff this up, it’s to show you that what you want is in closer reach than you think!
My hope is you start to see the risk you perceive is just that, perception.
Now that you have a general plan, the only thing standing in the way is trusting the belief that you can do this, and I know you can.
Interested in learning how to apply this to your clients?