Financial tips every self-employed doctor should be mindful

Financial tips every self-employed doctor should be mindful of

The Indian healthcare industry is all set to experience growth of 22.87% by 2020, reaching the $280 million mark. As a self-employed medical professional, now’s the best time for you to capitalise on this scenario. The rise in investment in the industry surely creates a favourable climate for your business to thrive, meaning that the smart financial decisions that you take today will go a long way in helping you lay the foundation of a successful practice. 

Whether you’re looking to set up a clinic or expand to a larger facility, here are a few financial tips that will help you stay on course.

Tackle debt head on

Be it credit cards that you use for your clinic or loans you have taken to finance your education or clinic’s purchase, if you have several outstanding debts, it’s time to consolidate them. This is because the more debt you have, the higher are the chances of you forgetting payment dates, incurring penalties as well as penal interest. If you consider managing multiple EMIs a hassle, it’s best to consolidate your debt today, so you don’t have any financial baggage weighing you down in the future.

The best way to do this is through a Personal Loan for Doctors or Loan Against Property for Doctors. By using one inexpensive loan, you can stop interest payments from eating into your profits and rid yourself of any financial stress. Moreover, consolidating your debt will help build your credit score. This is advantageous if and when you need a loan in the future to bolster your business.

Spend wisely 

Your ultimate goal may be to create a state-of-the-art medical facility that is a far cry from the sterile, unwelcoming hospitals of the yester years. However, as an entrepreneur, it’s also important to ensure your decisions are fiscally sound. This is to say that if you decide to spend Rs.18 lakh to set up your clinic, don’t splurge around 60% of your budget on décor, lighting and a play area for children. This is because you will be left with a measly 40% to spend on hiring skilled employees, buying software and equipment that will have a direct impact on your practice’s success, efficiency and profitability. Prioritise your expenses, and distribute your budget proportionately, based on the return on investment you are likely to enjoy in exchange.

Pay attention to working capital

Assume that you run a clinic and have a handful of patients admitted for various ailments at all times. You must have the finance to also have staff on hand to monitor these patients through the night and doctors to attend to any emergencies. Similarly, not having nurses and front office staff will slow down the rate at which patients are attended to, leaving you with frustrated clients and lower profits. 

So, it pays to ensure that you have ample working capital at all times, regardless of the size of your practice. It will allow you to hire the help you need, no matter what the situation. Another way in which working capital helps is that it allows you to run your business smoothly, without any hiccups. This means while your finance department contacts insurers to settle bills, you don’t have to worry about how you’re going to pay salaries, or renew the license to your electronic health record software.

One way of ensuring adequate working capital is by cutting back on expenses and automating as many processes as possible to reduce expenditure on salaries. However, if you notice that your working capital levels are dangerously low and you can’t cut back on expenses immediately, your best option is to avail a Flexi Business Loan for Doctors from lenders such as Bajaj Finserv. A customised, collateral-free financing solution that gives you Rs.30 lakh within just 24 hours, is perfectly suited for your dynamic working capital requirements as it lets you borrow as you need and prepay when you can. In fact, checking your pre-approved offer can help you access the loan even more quickly, through a 1-step verification process.

Keep these 3 financial tips in mind to ensure sustained profitability for your business and don’t hesitate to use credit as leverage to bolster your practice when the time is right!

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About Author
Lakshay Chotiya
Lakshay Chotiya is an analyst at PlexusMD and is a part of the Editorial Team. He is a B.Tech graduate from Indian Institute of Information Technology, Vadodara. He likes learning new things and writing. When not working, he is either exploring new places, binge-watching, meeting new people or playing strategic games.
About Bajaj Finserv
Bajaj Finserv is an investment management company engaged in insurance, financing and investment businesses. It is the industry's first company to introduce "Loans for Doctor" - A one stop shop for doctor’s financial needs that provides an executive suite of customized and affordable loans with exclusive benefits.
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