Plan your finances

Christmas is coming and we are all starting to think about gifts for family and friends, sprucing up our home with christmas trees, social parties are on there way, and of course the festive food and odd tipple! The interesting thing about Christmas is it comes every year and yet still many of us don’t plan financially for it. I find this to be exactly the same for dental practices the planning is not there! Christmas is not unexpected and in your dental business neither are the majority of your expenses.

My analogy on the Business Management course is ‘think of your dental practice as your home’. Your household needs a plan. Most of us are very keen and encouraged to have as many fixed costs as possible such as mortgage, gas, electric, mobile phone, Sky etc.. By fixing a cost you know exactly where you stand and then that leaves you with the variables to manage. Variable expenses i.e credit cards, impulse buying, food shopping, petrol and Christmas can all be areas where you have not allocated enough for, so how do you finance them?

The only way is to budget for them every month and force them to become a fixed expense.Impulse buying can get allocated a fixed sum of money every month and then you can impulse buy in the knowledge that you have funds in this budget to spend. In practice I call this a rainy day account where you place a fixed some of money away for unexpected expenses. This some of money is carried from one month to another until it is required or an investment is made in the knowledge that the funds are already there.

For 2015 have a budget plan and look at each spend in your practice and make as many of them as you can fixed costs. Then initiate a rainy day fund, you need this for those unexpected expenses. The CQC and GDC have both created unexpected variables this year so the faster you have a contingency fund the more in control and comfortable you will feel.

Michael

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