The Practice of Therapy

Gordon: Well, hello everyone and welcome again to the podcast and I'm really happy for, to, for you to get to know today. Andrea Rotundo. Welcome, Andrea.
Andrea: Hi, Gordon. I'm so excited to be here.
Gordon: Yes. And so today we're gonna be talking about bookkeeping and, uh, a little more about how we can maybe make that not so scary for people and just thinking about our numbers and all of that sort of thing, but.
Andrea, as I start with everyone, tell folks more about yourself and how you've landed where you've landed.
Andrea: Yes, I love to share that story, so I'll give you the really summarized version of that. Many years ago, my plan was to actually be like one of you guys, the listeners, a therapist, and after. Few changes here and there and life happens.
I shift that direction into accounting and bookkeeping and all sorts of things related to money, and I knew before I even launched my business almost five years ago, I. That I wanted to serve this, this community in a way. It felt like I owed that to the, to the space and to the people. And of course nobody was telling me that, but it just, it was this internal pressure of I want to, to give back to this.
Mm-hmm. So I decided that this was gonna be the, my clients that I wanted to serve. Therapy, uh, practice owners.
Gordon: Yes. Yes. Well, that's got, I'm so glad you're here, and I think that this is gonna be an interesting conversation. So, yeah. So I guess to start out with, when you, when you think about maybe the difficulty that you've learned that therapists have with bookkeeping and kind of the scary nature of it, what, what comes to mind for you and Yeah, how can we make it simpler?
Andrea: Yeah, I think it's really important to understand where we are and, and acknowledge the fact that, well, if I feel nervous or if I feel scared, it's probably because, and at least in my clients, a lot of them come with without that experience. Of business, for example, or business school or, or, or classes regarding accounting.
That's not a lot. There's not a lot of experience when it comes to that. So launching your own practice feels very overwhelming when it comes to the finances because again, there's not a lot of experience in that area. But unfortunately, to run a business, you do need to pay attention to the finances. You can't ignore that, at least not forever, right?
We do that. Especially in the beginning, we kind of like put it off, but then there's gonna be a point where you're gonna have to come face to face with that. And if you let that time pass by for longer and longer, then that's gonna become even bigger and scarier in a way because you're not gonna be looking at things when they're still, you know, in the baby steps.
We are adjusting. It's already a grown business. You're making money. You might have even people in your team. And starting to look at your numbers in that area, in that moment in your business feels a lot bigger. So what I, what I like to do, or my approach is to break it down rather than looking at this.
Really impressive goal of being almost a professional in the finance world. Mm-hmm. And I can do this, and I'll show you all the certificates that I've done so that I can tell myself and others that I'm good at finances. I like to break it down into much smaller tasks and much smaller, maybe even mini projects, and then little by little.
Mm-hmm. As you know. Mm-hmm. We do one thing and then we get a little bit good at it, just a little bit. Mm-hmm. And then we show up again, and then we start to get better at that. And then suddenly you have done this for so long and that's so long. It will look differently for everybody. It could be a week, it could be a month, it could be a year.
So depending on how you approach it and how often you show up and how often you try new things and. You might make mistakes and then show up and you do it again and again. Then you start to realize this doesn't really feel that scary anymore. Mm-hmm. And I think that isn't that journey, but also in that moment of showing up that things don't feel so scary that you actually give yourself the space and the permission in a way to, okay, now that I feel better here, let me pull this report and I'm gonna try to see what it.
Telling me or mm-hmm. I'm going to have a conversation with my bookkeeper or my accountant and I'm gonna ask them these questions. So isn't that journey of breaking things down a little bit smaller to make it easier for yourself first initially to show up? Mm-hmm. And then to get a little bit deeper with the numbers that you realize you can do this.
Right. You don't have to be a professional and, and you know, if, uh, have a degree in accounting or anything like that, you can, you can literally. Just do it.
Gordon: Right, right. Yeah. And I, yeah. People have heard from me all the time over the years, just the importance of knowing your numbers and keeping a pulse on the finances.
Yeah. Because I've heard so many stories of where people have really kind of gotten themselves into the weeds with, with their. You know, with their accounting or their bookkeeping Right. And end up at the end of the year with a huge tax bill that they weren't expecting and all of those kinds of things, which are Yeah.
Yeah. It's so, so important. So, yeah. So kinda walk us through kind of your method of, uh, kind of helping people break things down and looking at their numbers and understanding all of that.
Andrea: Yeah. One of the things that I, I, I really enjoy doing is creating that space to just talk. And I think a lot of therapists kind of are looking for that in, in, in their accounting professional, but maybe they don't find it often, and it could be just.
My personality. It could be because I like and understand the psychology of it, but I like to intentionally create my conversations and the way that I show up and kind of the plan that I put together for my clients, for them to show up and be comfortable. So I kind of take two different components and I put them together.
One is structure. I think it's important to have structure. Especially in accounting, right? We wanna have things organized in place. We wanna know where to put things together. But when you are coming without that experience, and many of my clients tell me, I don't even know what I don't know, like, I just literally, I, I don't have anything in place for saying that out loud is it takes a lot of courage, especially as a business owner.
So instead of taking the approach of, I can't believe you, you know, I can't believe you don't have this in place, how come you have a business? It's okay. So let me show you the structure. I'm gonna walk you through it and I'm gonna ask you questions and I'm gonna kind of prompt you today. We're gonna work on this tomorrow, we're gonna work on that, then we're gonna work on this.
But then at the same time, the other component is that, mm. People are, is what we're working with. You know, we're not mm-hmm. Just machines. I'm not just this computer behind the screen, and I'm not expecting you to be either. So because we're both wanting to take ownership of the situation, we want to get better at what we're doing, I want that for you.
Mm-hmm. Then I create that space for you to be human. And if you make mistakes. It's okay. And you, if you have a question, I'm here to answer it. And I take that into consideration as well and the pace, because for some people I. It might be extremely difficult. They might get really anxious. I remember one of my clients during the very beginning, I, I don't wanna have conversations that are longer than 20 minutes or 30 minutes because usually we'll book one hour meetings.
So she was open to tell me, let's just do 30 minutes. So I keep that in mind and I have the structure that we're gonna implement. And of course, every step is very intentional in what we're doing and what we want to achieve. Having clarity with this is why this is important and why this matters to you.
Mm-hmm. And to your goals, but then also not just like machines, this, this, this, this. We're gonna have a conversation, talk about it. Mm-hmm. So that structure kind of serves as guardrails, like we have a clear vision because we talked about it. Mm-hmm. We know what you want because we talked about it. So a lot of conversation.
We know where you are because we talked about it, and also we have your numbers. So that's available to us, right.
Gordon: Uhhuh.
Andrea: And then now bringing in the human part together, we walk through that together. Right. So that's kind of both components that I put together when I work Right. Uh, with my clients.
Gordon: Right.
Yeah. So when you, when you mentioned the structure, tell us more about how you like to structure things for people and what that looks like.
Andrea: Yeah, that will depend Gordon on their practice, so
Gordon: mm-hmm.
Andrea: If somebody is new and their goal, at least for the, you know, foreseeable future, that's their plan.
They're gonna stay together. They might have a different tech stack that somebody that has a group practice and maybe has a couple of offices mm-hmm. Or sure. You know, a team of W2 employees. So, mm-hmm. Part of my onboarding process is just to have, again, that conversation to understand. What they're using and how they're using it and for what purpose?
'cause again, mm-hmm. When we come it not really understanding or knowing. We start grabbing resources from a lot of different people. And then we have this big list of, I have the spreadsheet over here and I have this app over here, but that one is not really fully complete. So then I'm also gonna have this other one.
And then I also have my personal app. Mm-hmm. So my personal finances app, so. In the beginning, we kind of assess, okay, tell me what you have. Mm-hmm. And then in that process, we start, if needed, we start to make changes and simplifying it. So for your bookkeeping itself, we'll just stick to one system we're, we don't need extra spreadsheets and things like that to track your income and your revenue.
Mm-hmm. So we'll stick to one. Usually QuickBooks Online is the most common one.
Gordon: But there
Andrea: are other ones that do the same thing. Right. And again, going back to where you are and, and where you want to go, maybe a free software could be a great fit if you're just a solo clinician and that's your goal. But if you have a group practice, I wouldn't suggest that, for example, I would suggest something.
Mm. That has a little bit more features to them.
Gordon: Mm-hmm. And
Andrea: then. Although, eh billing and accounting is, has to be completely separate when it comes to a private practice because of HIPAA compliance. Mm-hmm.
Gordon: Right.
Andrea: And that's. Falls under the category of billing, not really accounting or bookkeeping. I take that as part of your picture because I want to make sure that you're using that correctly.
Mm-hmm. Or that you're not correctly, because I don't coach you on that, but you're using it. That's my goal with that. Mm-hmm. I want you to charge all of your payments from your clients through your, your EHR. Nothing that will come through the banking in the terms of. Like, you know, Zelle or PayPal transactions or things like that.
Mm-hmm. Everything will go through your EHR. Mm-hmm. And then we look at how are you doing with like, or how often are you looking at your financial report? So we kind of go through the, the course of the financial cycle. Mm-hmm. Also looking at your calendar. So we know that every quarter. We have to pay taxes and the quarters from the I-I-I-R-S are a little bit different, so
Gordon: mm-hmm.
Andrea: That comes to a surprise too. Okay. So we understand this is what you're doing. We have everything together. We're connecting all of your accounts, your credit cards, and all of that. We look at how you are receiving your payments, is there anything that we can do to improve that? Okay, now we're gonna look at the area of taxes.
Are you prepared? Do you feel like you're prepared? Do you have surprise tax bills like you mentioned in the beginning? Mm-hmm. Why is that? So then. Usually that falls under the, the, the stage of looking at your financial reports and making an informed decisions based on that. So based on all of that, we start using apps.
And in my case, I use another app, like a client, a secure client portal to ask questions and share documents. So if you're working with a bookkeeper or you're, or an accountant, for example, I would really encourage you to. Never email anything. Always try. Even if you, your accountant doesn't have a portal and you are using QuickBooks.
You can actually share documents through QuickBooks so that you're not emailing anything. So little things like that. But when it comes to the actual accounting, it'll be just in one place. And then I'm also a certified profit first professional, so another. Mm-hmm. App that we can incorporate as a Profit First app where we, again, connect your bank and we look at percentages and things, but that'll be more of after the fact of the bookkeeping to get a little bit more detail in cash flow management and all of that.
But like we said in the beginning, I like to keep things simplified. If the, if there's something that I can do to remove, whether it's an. Email or a spreadsheet or something, that'll be another thing on your list. That'll be my goal to make things simple, but also. The most beneficial for you,
Gordon: right, right.
Yeah. It's, uh, you know, I've, I've learned kind of the hard way over the years trying to, when I, when I've created these, you know, big different complicated ways of tracking stuff. Keeping it simple. Yeah, yeah. You can, you can end up doubling your work if you're not. If you're not careful, right? Mm-hmm.
Andrea: Right, right. Yeah, and it's not that they're not helpful, because of course there is gonna be information that you can pull from them, but like you said, mm-hmm. What, what is the real benefit and what is your input? And also you have to learn as you go and as you're building your business, you're gonna start to realize that there's things that maybe you never knew or expected that you would like.
So if working and creating or getting new resources and spreadsheets actually make you. Like you feel like it's actually beneficial to you and it's helping you make decisions and you don't dread it and it doesn't give you anxiety, and you're not missing out on weekends with your family because you're working on that, then that sounds like a great fit.
But for many other therapists, working on all of those things feels terrible.
Gordon: Yeah.
Andrea: All the, the, the worst things ever. Just all combined into one thing, so. Mm-hmm. If that is the case, then why are we going to make it. Harder for ourselves to make it happen. It doesn't have to be that way.
Gordon: Right, right. You know, and I, yeah, you make a really good uh, point, Andre.
I think you have to really kinda look at, you know, the stuff you enjoy doing and also versus the stuff that you dread doing. I'm one of the, one of those people where I enjoy messing around with QuickBooks and looking at the numbers, and so I, you know, I keep that on my plate, but I would say if I didn't enjoy it and it was confusing to me and all of that sort of thing, I would, uh, probably want to outsource that and have somebody else do it.
Andrea: Right, exactly. Because we gotta remember like, why are we doing this? Mm-hmm. If the goal, mm. Usually the first goal, right? Like it's just gonna be compliance. Mm-hmm. If you have a business, we gotta show our numbers to the IRS at the end of every year. We already know that the thing is. As business owners, again, we have to, like you mentioned, you have to know your numbers.
Mm-hmm. And that doesn't just magically happen,
Gordon: right? We
Andrea: just don't show up on the screen and things are explained in a way that we understand them, right? Mm-hmm. It's not just the system itself, but it's also our input and how much time we spend looking at it and asking different questions and. Thinking about what if or now what, and all of those things.
So if you want your goal to be, I just wanna have a spreadsheet to give it to my accountant, then you build it that way. For that. I think Uhhuh, you're gonna be missing out on so much throughout the whole year, and it's gonna be a little bit harder to run your business that way. Mm-hmm. But if that is your goal.
Then a simple spreadsheet will do. But if your goal is to, I wanna understand this, I wanna prepare for this retirement employees, payroll, summer vacations, all of that, then I want to prepare and have all of my little components in my financial systems mm-hmm. So that I can get that information because we're not doing all of the tracking.
Just for fun.
Gordon: Right, right.
Andrea: It's for the benefit and information that that gives us.
Gordon: Right, right. Yeah. Yeah. And it's um, you know, I think too is, um, and you might wanna speak to this a little bit, as part of when we're, when we're boot bookkeeping and tracking our numbers and everything. Is looking at, you know, what is the why behind that?
And I think, you know, one why is that we do have to, uh, for those of us in the United States, we do have to pay our taxes. And self-employment tax is much different than if you're employed by somebody. And there's a few more layers to it as far as. You know, being able to keep, keep up with that and like you said, pay those quarterly tax payments and that kind of thing.
But also looking at you know, what is it that you want for yourself in terms of your own financial goals, you know, saving for retirement, you know, um, what do you need to live day in and day out? What sort of, uh, standard of living do you wanna hold for yourself? And also, you know, just all of the things that.
We, we do, everybody does every single day as far as Right. You know, buying groceries and paying rent and or mortgages and, you know, all of those kinds of things. You've got to know what that number is that you need each month.
Andrea: Right, right. And it's really interesting coming from not. Having that in place, not tracking that in place to now you have a business and you kind of have to, right?
Mm-hmm. And then I see it as this really great opportunity to. A new door opens to wow. Like exactly what you said, how much do I need to pay myself?
Gordon: Mm-hmm. And
Andrea: if you don't have those numbers clear on your personal finances, then it's kind of a forced invitation to mm-hmm. Look at that because, right. You have to know how much you need to make every, every month in order for you to pay yourself what you need in order to then pay your personal bills.
So it's kind of this. Journey or this cycle of I need to know what's going on in my personal, have that very clear. Mm-hmm. And then because of that, this, I can work kind of like backwards of how many clients I need to have and see every, every week. Uh, what about summer? How can I prepare for that? What about.
Vacations, kids' birthday parties, if you have kids, and all the birthday parties and the gifts and all of that. I think it's a, it's a budget in itself. Mm-hmm. And, uh, retirement and if, uh, what about college for my kids, paying my school debt? Like all of these things, when you'll put it into practice and on the practical side of things are gonna come from.
Your profit. Mm-hmm. So it's important to understand your p and l or your income statement, that you're gonna have your revenue on the top. You're gonna have all of the expenses in the middle that are gonna be deduction for your business. And then the bottom line. Is the taxable income. So that's another incentive as to why we wanna track things for our business, because that reduces essentially the dollar amount that is gonna be taxed.
But from there, usually the question is, well, I see my profit and loss and I see that this. Profit number is, you know, whatever, 20,000, but I don't have that in my bank. How come? Mm-hmm. Like, where did that money go? Mm-hmm. So it's from that amount that if you are not on payroll in your practice, you're gonna pay yourself from that.
So. That takes, you know, it's being taken out from that chunk. And then savings, we wanna save money. Mm-hmm. So we take that from there. We want to save for taxes. I encourage all of my clients, save money for taxes as you go. Exactly. We don't wanna freak out at the end of every quarter. Like, oh my gosh, we have to borrow from here.
We're gonna do it as we go. It's built in into the system. Mm-hmm. So we take that from the bottom line, and we're gonna save for other little purposes here and there. And now I understand, oh, that is exactly where the money went. If you have debt for the business, that is where we're gonna take that from.
Mm-hmm.
Gordon: So
Andrea: that one number, it's telling you just one piece, like one area of the business, one story, but there's more chapters to it. And. The goal is to put all of them together so that you can not only understand how good you have been at managing the cash of your business, and but also a, a clear, in a way, way, or method as to where I need to get better or if I wanna do this, and I wanna have all of these goals over here.
Now I'm more clear as to this is where I'm at. This is where I wanna go. I can start filling in the steps, right? Rather than kind of being lost now and lost in the future. We are just working
Gordon: right. Yeah. And, and one, one thing you had mentioned was Profit First. And I'm a big fan of Profit First and I, I, you know, I think everybody in business should read Mike Al's book, but also I.
In, in our, in our space. Julie Harris wrote a book Profit First for Therapists. And yes, uh, she really breaks it down very specifically for therapists. And so quick pl quick plug for those two books and just, uh, I know, I love that my husband right here on my table. Oh yeah. Oh yes, yes. So, well on Andrea, I, I've gotta be mindful of our time and I'm so glad we had this conversation.
Tell folks how they can get in touch with you and ways in which they can work with you and how you can help them. I.
Andrea: Thank you so much, Gordon. Yes, you can reach me in two places. Mainly if you're hanging out on LinkedIn, you can find me there. Just look up my name, Andrea Rotundo, and my website is liquid sense bookkeeping.com.
Sense as in coin.
Gordon: Uh,
Andrea: you can find my services there. You can find a couple of resources, some free ones, some other resources that I have, uh, met throughout the, the years of working with therapists that I think are really, really helpful. So those are, will be there as well as a way to contact me directly so you can find my email there.
If you have any questions or if you wanna jump on a coffee chat with me. I'm happy to meet you as well.
Gordon: Awesome. Awesome. And we'll have links in the show notes in the show summary for people to access that easily. But, um, Andrea, so glad to have you on the podcast and hope we'll have, uh, another conversation here soon.
Andrea: Thank you so much, Gordon. It was great to be here.