Business Talk: The ‘Goodfather’
Anthony LombardiFeatures Business Management
Preparing ourselves, our practice for the inevitable
This is a landmark issue that commemorates a very special milestone. In many ways, Canadian Chiropractor magazine has become our professional extended family over the last 20 years. After all, many of us read this magazine regularly – more often than we actually see certain members of our own family.
Milestones bring many changes in ourselves. We go to chiropractic school, graduate and then join existing practices or start our own clinic. Some of us get married and have children and maybe even grandchildren – although not necessarily in that order. Personally speaking, after I had my children I began thinking practically about an inevitable milestone in life: death. I know what you’re thinking, “Lombardi, quit being so negative!”
Death is not a topic many people think about or even talk about, but one that needs to be addressed so we can be prepared before we get a final visit from the Adjustment Bureau. And speaking of movies, Francis Ford Coppola’s classic, “The Godfather” quotes will serve as a backdrop here as we segue ourselves into eternity.
“I work my whole life… to take care of my family.”
It’s important to have goals for you, your family and your practice. Personally, I wish to make sure the mortgage, my kids’ university and postgraduate education, and all the expenses in between are taken care of. Having a succession plan written and legally organized will pay dividends because it’s the only directing voice you will have once you pass.
“Friendship and money is like oil and water.”
Finding a competent, well-respected lawyer to help you organize your will is invaluable, since your death will be a very emotional time for your loved ones. Be as clear and concise as you can in regards to disbursement of your assets, money and especially the succession plan of your practice. I spoke to the lawyer at the College of Chiropractors of Ontario, and she advised that whether our practice is registered as a sole proprietor or a professional corporation, once we die the practice is directed to our estate where it would be handled according to our wishes. This will alleviate conflict because, as has been demonstrated in the past, when money is involved family and friends can become immiscible – like oil and water when matters of assets take centre stage. So do not assume your beneficiaries will behave rationally – be clear, write it down and get a lawyer.
“It’s not personal. It’s strictly business.”
It’s very important to analyze the growth and development of your own practice, but when developing a succession plan you need to picture and analyze it without you in the equation. This can actually be very interesting as you will realize that although you likely generate the greatest amount of revenue, you also generate the most amount of expenses. Here, you must answer the question: Can my family draw a reasonable salary from my practice if I am not in it?
If you have a multidisciplinary practice with several practitioners, then this will be able to benefit your family, if you have the right structure in place. This is why it is of paramount importance to have all of your associates and allied health agents (RMT, physiotherapist, etc.) signed to contracts that not only describe the terms of your agreement but, more importantly, the length of time they are working with you. All of the chiropractors and therapists that work with me are signed to contracts that vary from one to three years, so within that time they are committed to the clinic.
“Make them an offer they can’t refuse.”
Refer – The longer associates are with you the longer they will stay – if they are busy. Contracts that stipulate a time period are great, but people won’t re-sign a long-term agreement if they don’t have a healthy patient load. Making a habit of referring patients to your associate therapist will help build their practice and your relationship with them.
Motivate – For my chiropractic associates and physiotherapists who are thinking of signing a long-term contract with me, I offer them extended health care benefits to make things more attractive. These benefits not only cover them for prescription drugs, dental, and vision – but they insure their spouses and children as well. All of these benefits are more affordable than you think and can help motivate your colleagues to remain with you in the future.
Compromise – It is a wonderful tool and it can help build your practice to grow into a well-rounded team. Always make your agreements fair so that they are a little more lucrative than they need to be for your colleagues. With some of my practice associates I even include how the terms of the agreement will change upon my death. All of this is done to ensure that even when I’m gone, my family can still draw a reasonable income from my practice.
“Good health is the most important thing. More than success, more than money, more than power.”
Even the Corleone family preached the importance of staying healthy – but life insurance is necessary because you need to protect your family.
When it comes to life insurance it’s responsible to cover at least the expenses that your family is accustomed to. This is why insurance specialists recommend basing your amount of life insurance on your family’s spending habits and not just your income. If your goal is to pay for your children’s education or that dream home, then your insurance benefit will need to be higher.
As important as it is to make sure your family is protected, it’s no substitute for having you here in the flesh. Practicing a healthy lifestyle can pay dividends in the future. However, critical illness insurance is a valuable policy to own in case you get sick – so you have the expendable income to help you get better faster. I have critical illness insurance which pays me a lump sum amount of $250,000 should I get diagnosed with cancer, heart disease or 22 other conditions. What’s great about this policy is that I pay my monthly premiums but if I do not make a claim after 15 years, I get 100 per cent of my premiums refunded to me.
Being prepared is always a good idea. If you have questions about anything I’ve written about or if you would like access to the insurance contacts I use, email me at firstname.lastname@example.org.
Dr. Anthony LOMBARDI, DC, is a private consultant to athletes in the NFL, CFL and NHL, and founder of the Hamilton Back Clinic. He teaches his fundamental EXSTORE Assessment System and practice-building workshops to various health professionals. For more information, visit www.exstore.ca.
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