There is trial every now and then by people to build private practice. One needs to realize that private practice is actually business and not a hobby. Therefore since it is a business, there are several things that are put into combination for it to flourish. A combination of effective marketing, proper mindset and the right attitude is required. In setting a private practice finances is a key factor. For a successful practice, financial literacy is one of the most essential factors. What one needs is a healthy relationship with money and know how to manage it. A lot of things that relate to money are there and they include adjusting thoughts and beliefs around money.
In accounting there is something referred to as a three piece pie accounting section. What is meant by this is that the income that one gets should be divided into three sections which should go into different bank accounts. There is the tax pie and this requires that the income deposited here should not be touched until it comes to the time to pay taxes. The second section of the pie is for paying bills since in a business bills need to be paid. In a private practice one will definitely need to pay bills which include water and electricity bills, services such as cleaning bills and of course salaries. The personal account is the third section of the pie. One can find that they have some of the money left after paying taxes and this money can be taken to the second section of the pie which is paying bills. After the bills have been paid, some of the money which might be left can be taken to the personal account. This three piece pie section is very important as it makes sure that one does not lag behind in paying taxes or other bills. Also, the three piece pie section ensures that personal and professional funds do not mingle.
One should know the time for investment and the time for saving in money matters. Since one can find themselves spending even what they are supposed to save, they should always have a balance between saving and spending. There is a tendency by some people at times to cling so much on their money such that they even forget some of their needs and also limit their chances of growth. Some people always have the fear of not having enough. Healthy financial management in a private practice will ensure that there is enough to spend and to save. For the good management of the finances, the three piece pie accounting section can assure a person. One can be led to overspend or to over-save by having an unhealthy money mindset .