Can You Increase Your Cash Flow This Year?
How Can You Increase Your Practice Income? By using our built-in Point-of-Sale (POS) system! Use a bar code scanner to create an inventory that your patients would be interested in purchasing. Use the same scanner to check out your sales and your inventory will be controlled automatically. A task will open to alert you when products need to be re-stocked. Learn all about your POS system with this free webinar. See how easy it is to track your product sales and then see an increase in your bottom line. See the POS system in action and learn more by watching this free webinar on this page right now. Read the transcript: Jason: All right, we’re gonna kick off today. My name is Jason Barnes, and I’m here with Jessica Pancoast, head of our support team, our help desk teams. Excuse me, I said support. I meant, training team and help desk team. And today we are going to discuss point of sale items. And we would love it if anyone had a question at any moment during this, don’t hope that we’ll cover it. Type in your question. Jess, where do they go to type in the question? Jess: It may also already be open on the left-hand side of your screen. If it’s not, at the top left, there will be a button that says, “Show chat,” and you can click on that, and then you’ll have the chat window on the left side, and you can enter your question down at the bottom. Jason: Awesome. So more and more with the practices that are using our system, we see that it’s a core offering in a major part of their business to sell products, different services that are not covered by insurance, that they only expect patients to pay in cash, you know, credit or check. And so we wanna make sure everyone understands how, number one, make sure that their services are coded, entered with associated prices or MSRPs, that they have a good understanding of how those items are entered and bundled underneath the patient accounting scheduler. And then we can show them how to actually look these items up from a reporting perspective, to see which positions, which locations, and which products are actually selling. And then on top of that, we wanna make sure that you are staying in control of your inventory. So that will be our agenda for today, to really walk you guys through our methodology, you know. As always, we have a specific way of doing things here within [inaudible 00:01:52], and we wanna automate as much as we possibly can. When you have an inventory control problem, for instance, we don’t want you to manually count the bottles of vitamins or your Biofreeze or your TheraBands, [inaudible 00:02:08], etc each and every day. When you have a shipping come in, that’s the time where you know you had 36 come through the door, we wanna make sure that the only manual part of this process for checking inventory is when you actually go in and enter in 36 additional of the unit came in. This also goes for pricing for things. We wanna make sure that you don’t have to remember pricing in the beginning. We wanna create a fee schedule that will pull each and every time you sell the same item. And this also will…it will go for a couple different places, like scanning and barcodes, you know, remembering codes, descriptions of things. We wanna make sure you guys know all the tips and tricks to really get the flow of this down. So to start with, we’re…Jess, you mind taking them through how somebody would manually enter in a product that they wanted to sell and track in the system? Jess: Sure. So to configure your point of sale items, you’re gonna go to configuration practice, and then go down to point of sale, and you’re going to get the list of… Jason: One control boxes. Jess: Sure. Place them in there. All right. So you’ll get the list of any items that you already have in the system. So then you have two options of adding new ones. You can go to the last page if you do have more than 30 by using the next button up the top so you get the blank four lines. Or you can simply click on the Add New button, which will immediately bring you to four quick empty lines that you can fill in. So to enter a point of sale item, what you’re going to do is you’re going to go into the CPT field. What do I recommend is hitting enter. This will pop up a window to let you know what your next CH code is in order rather than trying to remember which one you left off on. And then you can just select the next one. If you do try to reuse the CH code, you’re gonna run the error of there’s nothing to save. And it does have to be a CH code. You can’t make up your own CPT codes for these items. The CH codes are all entered in our database so our system can use them. So that is how you’re going to pick the CPT code to begin with. The next field, you’re just going to enter in the price of whatever item you are trying to sell, and then you’ll enter the tax for your state. You have two options. You can do the percentage or .075 will be 7% or type in 7 and it will just be the percentage. Jason: It sure is smart. It knows whether or not you meant to put it that one and didn’t. Jess: Yes. Jason: Okay, all right. Jess: In this instance, yes. Short description, just a basic abbreviated description of the item that you’re selling. I’m just going to make up that we’re selling a wrist brace.
Can You Spend Your Care Plan Escrow Account?
Your Escrow Account – How Do You Track it? Learn about your care plan escrow account and about how to legally administer the account. Can you spend it? Should it be kept separate? How do you track it for every patient with a care plan? What’s your total? This account is the money that your patients have paid in advance for their care and you’re supposed to hold it until the appropriate time to pay for their treatments. See how easy it is to track your account by date range and then see a total with a few clicks in our software. See it and learn more by watching this free webinar on this page right now. Read the transcript: Jason: Well, welcome, everyone. My name’s Jason Barnes, and I’m the Chief Operations Officer here, and I just love talking to people who are looking to solve problems. And today, we received a request from a fairly number of our clients to learn how to better track and understand a single topic, which I’ll introduce here in just one second. But with me is Jessica Pancoast, who is the head of our Training and Help Desk teams, so we’re gonna be co-presenting this particular one today. To start off with, we’ll define the feature/the problem that we’re trying to solve. When a patient walks into an office and agrees to a particular care plan, there are three ways of handling this particular incident, right? They can make payments as they go, co-payments, whether or not they’ve got insurance or if they agree to an all-cash plan, they can do that. It’s not a problem. Jess, I would say we’ve got lots of practices operating successfully in this particular model, right? Jessica: Yes. Jason: Not an issue. But then the next two can help us run into a problem or two as patients prepay or have recurring payments for their treatment plans. There are three scenarios doctors can find themselves in. Now, one, they can be in a state that doesn’t even allow this as I’ve listed here as our second item. Some states require separate accounts, but any way you look at it, regardless of whether or not you can or can’t take prepayments, if you have one, you have to track it. And I’ll start with, you know, I will quote, I didn’t write this quote down, one of our doctors who said, “If I was to die tomorrow,” Jess, correct me if I’m wrong, “If I was to die tomorrow, I need to know how much I owe my patients.” And so, that is the correct quote? Jessica: Yes, or rather, this is how much the staff needs to give the patients back as he’d be dead. So… Jason: Excellent clarification. So today we’re talking about escrow accounts. Escrow accounts represent the money that a patient has paid for their services that an office has not earned yet. So today we’re gonna to talk about not only why you should do it for good accounting practices, but some of you might have real legal motivation to actually do this. I know in the State of New Jersey, prepaying for, let’s just say, any type of service can be illegal. So, you have to really watch what you’re doing. But in most areas, there are lots and lots and lots of patients who prepay or set up recurring payments to pay for their care with the doctor’s office. So today, we’re gonna talk about how to solve that problem and what is that we can do to help you keep track of it so that you can do a few things. And to cut to the chase, if you’ve got a bank account that’s separate, you’ll have to keep X number of dollars in that account. If you don’t have a separate bank account, for balancing reasons, you need to make sure you keep at least a certain amount in that bank account cover the credits. I’m not a tax expert. I’m not a compliance expert. You can always contact one, but they will share some information that you do need to keep certain number of dollars in your accounts to cover the credits that you need to for patients that you have not yet rendered services for but have money on the books. So today, we’re actually gonna get into some of that information. So, I will get over here. This is our demonstration account. There’s not much information to show right here, but we’ve got a number of reports that will help people actually look information like this up. So, in our reporting menu or drop-down that anyone would have access to, we’ve got “Practice” and we have a “Care Plans” drop-down that will allow you to access to a whole bunch of other things. In this particular case, there are lots of different ways to keep track of the finances for any individual, patient, or group of patients. Our best practice recommendation is that every single patient will have a care plan if you plan on seeing them more than once. You can look up balances, you can see what the expectations are, which will help you forecast what your revenue for the following month would look like, so it’s a great tool. But for this one, this Care Plan Escrow Report, this is the one that we utilize to help you as a practice figure out how much cash you need to have on hand should a patient do one of three things. Patient decides not to have any additional care, even though they’ve prepaid, you’ll have to have a policy on refunding dollars, most of the time you have to give it back. If a patient, you know, discontinues care, you’ll have to have a policy if they don’t contact you. You have $400 of their money, how are you going to know how long you can keep this money, whether or
Increase Collections In Your Chiropractic Office
Use Payor Allowed Amounts to Increase Collections Increase collections from insurance companies by viewing this free 30 minute webinar. See how to use Payor Allowed Amounts to check if you have been paid on-time and in full for your services by the insurance companies. This built-in feature of our Genesis Chiropractic Software shows what you’re supposed to be paid for various CPT codes that you bill out. Use this to actually see what you were paid and then you can see if it’s an underpayment or not. Insurance companies are known to underpay by “mistake” as they try to keep money that should be paid to your Chiropractic practice. If an underpayment is detected then the claim can be sent to your billing team for follow-up with that insurance company. Let them get to the bottom of it for you. Watch the webinar immediately right on this page. Read the transcript: Jason: Welcome to those who are just joining, we are going to start in just a moment here. Waiting just for a few more people to jump from the web section to the audio section and then we’ll get today’s webinar started. Thanks for joining us. You’ll notice that you’re all muted and we ask that you check your questions in so that we can answer them as the webinar goes on. We’re going to start, we’re going to spend about 10 to 15 minutes on our topic today which is Collections, very specific to Collections, the Payer Allowed feature in our system, and we’ll talk about why it’s important and then we’ll open this up to any type of question that you might have after that. So, I’m looking forward and we’ll give you…actually it’s 2:05 now, Jessica. Let’s get started. So, my name is Jason Barnes, chief operations officer here and this is starting to sound like a broken record, isn’t it? Jessica: A little bit. Jason: As always. Jessica Pancost [SP], the head of our training and help desk team here at our organization, is co-hosting. So, today we are talking about a topic near and dear to pretty much every practice owner that we have and then a whole bunch of staff who are directly impacted by collections. And so, today we’re talking about collections, so we’re going to spend a little bit of the time talking, not necessarily about why collections are important, I think that one’s self-explanatory unless you want to spend some time on that Jess? Jessica: No. Jason: You’re good? but we want to talk about how to measure collections. Want to talk about how to break it down in two separate areas where a practice owner can make sure A, all their visits are getting paid, and B, all the visits are getting paid the right amount. Today, we’re going to primarily focus on the second of the two problems we discussed. The first problem of making sure all visits are getting paid, it’s not necessarily a simple problem to solve. However, we will spend just a moment in a broad stroke on how we approach that, and it has to do with our dashboard. You can see here that I’ve blown up one of the most important parts of our home screen and it’s the dashboard, here of course, in our dummy practice where we’re going to look at collections month to date, total outstanding accounts receivable, meaning all of the charges that need to be followed up on from an insurance perspective, and then we break down those accounts receivable into three separate buckets. The accounts receivable will be on 30 days, beyond 60 days and beyond 120 days. So, in this particular case, there are $32,419 total outstanding accounts receivable, $26,000, $6,000 and then zero dollars beyond 120 Days. We break this into percentages so that folks can measure, not only compared to themselves, but to the industry, how well they’re doing at making sure all visits are getting paid. Good question, Jess. “How do I know if my accounts receivable is really low and all our visits are getting paid?” It basically translates into if you have a visit that’s not paid, that’s sitting out there past 120 days, the likelihood of collecting on it, I don’t care if it’s from a patient or an insurance company, goes down significantly. Your goal as a practice owner should be to monitor this number. This zero dollars is unheard of, but it happens, and we can start talking about ways that it happens in this webinar series, but this is a great indication that you’re getting all of your visits paid. If your accounts receivable over 120 days is very, very low, one, two percent, it means that you’re getting 98%, 99% of your visits paid. And the rest of them are either getting written off, appropriately we hope, but there’s ways of tracking that as well or they’re being moved into a paid status which is the ultimate goal. So, if you know that your visits are getting paid, and again that’s not where we’re going to be spending the bulk of our time today, the other one is, “Are your visits getting paid the right amount?” And I ask a bunch of interrogative questions today want to go over the answers to them. What is the right amount? Jess, how does, you’re talking to somebody about collections, do you have any idea, you know, to tell them if they’re getting paid the right amount for their CPT codes? Jessica: No. Jason: Why not? Jessica: I don’t know [inaudible 00:04:37], but different contracts and different states and everyone gets paid… Jason: Its complicated, it’s a complicated answer and the first thing we want to let all of our providers know is if it doesn’t seem simple for you, that’s correct, you’re not in a simple industry. What I need to establish before we start looking into this is it’s meant to be confusing, it’s meant to not
Chiropractic Financial Planning
Learn how to avoid money mistakes and use money saving tips with Chiropractic Financial Planning rules and then implement them.
The Secret to Never Missing Patient Payments and Insurance Collections
Maximize your Insurance Collections for Your Chiropractic Practice! Chiropractic insurance collections is a hot topic. Chiropractic Practices rely on separate reports and manual processes for follow up on patient payments and insurance claims. If you look at a report that lists hundreds of your outstanding insurance claims, how do you tell which claims need follow-up and more importantly, what information do they need from you to be corrected and resubmitted? Imagine never using a report to find out what an insurance claim is missing. Imagine a tool that tells you exactly what to do to correct the claim, and then resubmits it for you with a click of a button. Imagine the increased revenue for your Chiropractic Practice. Imagine the time savings that you can now spend with your patients. Well, imagine no more. The tool is called The Genesis Provider Workbench and you can learn about it in this 22 minute webinar.
Revenue | Getting Started with Billing Software
Prepare for Launch! Getting Started with Billing Software. Dr. Wilson and Luisa make final preparations to dive into their Genesis adventure together As Ben sipped his coffee and checked his email, Luisa peeked her head into the doorway and asked, “Are you ready, Dr. Wilson?” Ben smiled and said, “I’m not sure, but let’s go ahead anyway.” Luisa dialed the phone number for Charlie, their Genesis coach. After a couple of rings, Charlie picked up on the other end. “Good morning,” he said cheerfully. “So today’s the big day!” “Hello Charlie,” laughed Ben. “It sure is. And I think we’re finally ready.” “Then let’s get started – we’re going to talk about the features of Genesis that will be most useful for your practice and offer that final bit of reassurance that you’re doing the right thing,” Charlie said. “They don’t call me the King of Practice Success Coaching for nothing!” “OK Charlie, we’re ready,” said Ben. “Let’s go through this one last time.” “Let’s start with the ‘why’ of the Billing Stats Report, and relate it to some of the challenges you may be experiencing in your practice,” Charlie said. “You’re doing pretty well financially but have you ever experienced any sudden drop-offs in revenue that you couldn’t easily explain?” Luisa and Ben looked at each other and could remember several occasions when that was the case. Just a few months ago they had seen a significant and disturbing reduction in revenue and it had taken weeks of going through billing records, manually, to learn that Pam had been writing the wrong billing code on a number of Ben’s patient files. Every single one of those claims was delayed or denied outright. They were still trying to get some of the accounts sorted out. “Yes, we’ve found it very difficult to troubleshoot issues with reimbursements,” admitted Luisa. “And it’s not always the insurance companies’ fault – getting even one number wrong in the coding or forgetting to include important documentation can really impact our success in collecting what we’re owed.” “Exactly, it’s about achieving billing compliance AND payer compliance,” Charlie said. “But it’s important to recognize that the insurance companies are not going to give you a step-by-step reporting on the progress of your claims – it’s better for them if you’re not able to stay on top of the process.” “I’m sure I’ve mentioned to you before that the chance of getting paid on a claim decreases by 1 percent with each passing day,” he continued. “That 1 percent adds up really quickly when you’re talking about an entire practice’s worth of patients and numerous claims.” Ben and Luisa both had to swallow hard at the thought of the tens of thousands of dollars they had lost due to reimbursement issues. “It really is amazing the detail you can get,” Charlie said. “The reports are customizable to your particular needs and will tell you where problems are – whether on your end or the insurance company. Perhaps there are two codes on a claim that don’t quite go together, or a clinician forgot to include some demographic information in the claim … or maybe an insurance company is consistently underpaying certain CPT codes, or pushing the boundaries of its accounts receivable window. You can’t fix problems until you know what they are!” “That’s true,” said Ben. “I definitely don’t envy Luisa – she’s been an incredible investigator when it comes to solving cash flow mysteries but the time she has needed to dedicate to these investigations has definitely taken crucial time away from other office management needs.” “If the roots of billing problems were easy to find, we’d be able to deal with them quickly and decisively,” said Luisa. “You know how I love to have a plan!” Ben nodded and smiled. “And it’s not just insurance companies,” Charlie said. “You can stay on top of private payers, as well, and make sure that your patients are on track with visits and billing.” “That would be really helpful,” said Luisa. “We’ve had several patients who were significantly behind and once we figured out where their accounts stood, it was a real financial hardship for them to try and catch up all at once.” “But it’s not all about reimbursements – what’s great about Genesis is that it provides you with a checklist for all of your performance indicators, such as unbilled visits, patient visits, no shows, unfinished claims, or any other success measures you’d like to track,” said Charlie. “Another great feature is the radar chart, which allows you to see certain areas within your practice where attention may be needed,” he continued. “You can set parameters, such as new patient numbers, so that you will know if you’re not meeting your goals. Once you’ve set the desired parameters for a number of performance indicators within your practice, then you won’t need to refer to the Billing Statistics Report – unless the radar indicates there is a problem with performance. Between the radar and the Billing Statistics Report, you are going to be firmly in control of your practice’s financial health and performance.” “This is incredible,” mused Ben. “Being able to focus on building this practice instead of worrying about when reimbursement checks are going to arrive? I really didn’t think it was possible.” “I know you’re still probably a little intimidated about getting started but let me offer this final testimonial: In the past three years, my clients have seen average revenue growth of over 186 percent, patient visit growth of over 141 percent, and an 86 percent increase in patient visit compliance,” Charlie said. “Your patients will have more buy-in with regard to their own health care, you will have less administrative work to slog through, you will collect more money and – best of all – you will be able to spend more time with your patients.” “Well, that’s what we’re all here for,” said Ben. “Let’s do this!” Is Genesis the solution Ben’s
Revenue | Automating Billing Reports
Where Should We Go Tonight? Can Dr. Ben make the commitment to automate his billing reports and take control of his office finances? Ben and Carmen were having a familiar conversation: what should we do about dinner? They had both returned home from busy days at work, both were a little frazzled and hungry and – as usual – the refrigerator was lacking in appetizing options. “I’ve heard that the new Indian buffet is very good,” said Carmen. “But it’s downtown and it’s almost 6:30, so there might be a bit of a wait.” Ben thought about that. “That sounds delicious and we should definitely get there at some point, but I’m too hungry for a long wait. Why don’t we just go grab some Chinese at our usual place – there’s never a wait there.” “You know, Ben, we’re never thrilled with our meals there and we’ve tried everything on the menu,” Carmen said. “There’s a pretty good reason why there’s never a wait there.” They looked at each other testily for a moment – hunger and a lack of accord might become a threat to their nice evening out. Just then Jonathan came running out of the living room and hugged Ben, happy to see his father. “Daddy, you’ve got to see my new art book – I drew all of the pictures myself!” “Of course, Jonathan, I’d love to see it,” Ben said. “Listen, Carmen, I’m going to look at Jonathan’s artwork and then we can go try that new restaurant downtown. It sounds like fun.” He went into the living room with Jonathan and sat down on the couch with him. He wondered why he was so irritable this evening as he turned the pages of the book. Ben’s thoughts kept returning to earlier in the week, when Luisa explained the difficulty she was having keeping track of the office finances. Too often they were surprised to learn that some patients had accounts that were past due. And between varying accounts receivable windows and some insurance companies that were dragging out the reimbursement process due to even minor errors in data entry, it was making confident budgeting impossible. Ben pondered how difficult it was for him to keep track of crucial patient information until he put a system in place. Between his voice recorder, written notes and meticulously organized files on his computer, he felt confident in his mastery of the most important details for each patient. But then he thought about how many areas of office management that Luisa was expected to stay abreast of: office supplies, scheduling, working with outside vendors, insurance reimbursements… her plate was truly full, even with Pam’s able assistance. And considering that third parties don’t always respond when and how you want them to, the level of complexity and the time it takes to handle each task can be multiplied exponentially. Carmen – who had a business degree and always seemed to be several steps ahead of Ben in understanding the ins and outs of finance – and he had talked about the program that could automate many of the functions of his office and Ben had been serious about actually following through and implementing it. But there always seemed to be a crisis to attend to… trying to collect from patients who owe balances beyond a certain date, trying to figure out where long-overdue insurance reimbursements were. Ben knew when he started his practice that it wouldn’t only be about attending to patients – he knew there would be crucial administrative work that would have to be handled by his staff. Luisa had certainly had shown she understood the benefits of having data to inform business decisions. But customization is key when reviewing large amounts of detailed data and it didn’t seem like Luisa was tapping the full potential of the system when it came to the billing reports. Ben knew that there were reports that could be broken down in a number of different ways and could be endlessly customized so that they could stay on top of potential problems. Well, maybe we should take some time to figure it out together, Ben thought. Without getting these reports done – and done right – we really have no idea how well our office is functioning. This sounds like something we should talk about on Monday. But first he wanted to enjoy a nice dinner with Carmen and Jonathan. He appreciated how Carmen listening to him talk about the various issues in his office, and she often responded with some great feedback. That business degree had served both of them well over the years. When Ben had finished looking at Jonathan’s artwork and congratulating him on being the next Rembrandt, he found Carmen in the hallway, ready to go – her purse in one hand and a small lunchbox in the other. “What’s in the lunchbox, Carmen?” Ben asked. “Well, since you’ve agreed to my pick of restaurants, I wanted to reciprocate by packing some snacks for the drive so you won’t be starving while we wait for a table,” Carmen said with a smile. “I’ve got some fruit, cheese and crackers, and your favorite – cashews.” Ben took Jonathan’s hand and smiled at Carmen, who never failed to make even the most hectic and frustrating day better. “We’d better get going,” he said. “Maybe we can be on the lookout for a new Chinese place on our way there.” Both were laughing on their way out the door. Can Dr. Ben make the commitment to automate his billing reports and take control of his office finances? Disclaimer: For HIPAA compliance, all characters appearing in this post are fictitious. Any resemblance to actual persons or actual events is purely coincidental.
Is the Infinite Banking System the Answer?
by Garrett B. Gunderson Some of the most frequent questions we get at Freedom FastTrack have to do with infinite banking. The financial strategy, which leverages the living benefits of cash value life insurance, was created by Nelson Nash and is detailed in his book Becoming Your Own Banker. Other popular books on the subject include Bank on Yourself by Pamela Yellen, The Banking Effect by Dan Thompson, Prescription for Wealth by Tom McFie, and Live Your Life Insurance by Kim Butler. I would characterize my attitude toward infinite banking as “cautiously positive.” I’ve personally interviewed Nelson Nash twice by flying him to Utah. I’ve ran hundreds of infinite banking calculations using financial software and consulting financial software developer Todd Langford. I’ve even used the concept in my own life. The problem with the strategy is that most people who do it or want to do it ignore the larger context of their full financial blueprint. It is frequently sold as a magic bullet. It tends to be a classic case of, “When all you have is a hammer, everything looks like a nail.” The truth is that it’s just one strategy and technique surrounding one product. And as you frequently hear me preach, strategies are only as useful and profitable as the people executing them. Infinite banking is a one-trick pony that can be useful in certain circumstances for certain people, but it’s not for everyone and it doesn’t solve every financial problem. To echo another theme I stress, if you’re asking whether or not you should use the strategy, the obvious answer is that you shouldn’t because you’re not educated enough yet. When you know enough about the strategy, you’ll know whether or not it’s appropriate for you, and how to execute it to fit within your particular financial blueprint and meet your specific needs. So let me give a brief overview of the strategy, then I’ll reveal its blind spots and pitfalls and explain how to use it appropriately. What is Infinite Banking? In concept, the strategy is simple: You use your whole life insurance cash value essentially as a line of credit. Instead of paying banks interest when you finance cars or other purchases, you pay that money back into your policy and essentially to yourself. This is done by funding dividend-paying, equity-building permanent life insurance. Once your policy is funded enough to make a major purchase, you utilize your cash value, take out a policy loan to make the purchase, then make “payments”—with interest—back to your own life insurance policy. The cash value of permanent life insurance is referred to as a “living benefit,” because you can access it throughout your life. Whereas term life insurance provides a death benefit only, permanent life insurance offers living benefits, such as the cash value, tax-free growth and tax-free withdrawals (under specific guidelines), liquidity, dividends (on certain policies), and liability protection (in most states). The strategy is smart, to be sure. Consider a five-year, $20,000 auto loan at 7 percent interest. On that loan your monthly payment would be $396.02. At the end of five years, you’ll have paid $3,761.44 in interest alone. Why not recapture that interest to build your own wealth, rather than padding bankers’ accounts? By the time you pay off the car, instead of just having a dramatically-depreciated asset, you’ll have the car, eventually you can build a way to have your $20,000 restored, and you can even have an additional $3,761 (not fully considering the interest that the insurance company may charge you on the borrowed money). So what could possibly be wrong with the strategy? Problem #1: Insurance Protection Comes First The trick to making infinite banking work as quickly and effectively as possible is typically getting a low amount of insurance coverage (face value, or death benefit), then max out your premiums (also known as over-funding the policy). Remember that the goal is to build up your cash value. The focus is on the living benefits, not the death benefit. But fully protecting your human life value with the proper death benefit amount should take precedence over any living benefit. Infinite banking makes the cash value the main benefit of permanent life insurance and overshadows the importance of the death benefit. Before you even consider infinite banking, you first need to maximize your insurance protection. That is the primary and most important purpose of life insurance. Living benefits are nice, and in most cases I highly recommend permanent life insurance with living benefits over term insurance. But they should be viewed in their proper context as supplemental benefits, not the primary benefit. In fact, before you even consider the type of insurance you should buy, you first need to understand how much death benefit to have. Your amount of life insurance to protect your economic value (replacement of income) is the primary consideration to drive all decisions regarding the type you purchase. This is why I don’t always advocate whole life insurance 100 percent of the time. I’ve seen too many cases where insurance salesmen sold permanent policies people couldn’t afford, and who then lost their policies because they couldn’t fund them. Just as it’s a problem to get too little insurance coverage, it’s also damaging to get too much whole life insurance. Focusing on death benefit first avoids problems like this. Some people may purchase convertible term insurance now to get the proper amount, then convert it to permanent insurance as their cash flow situation improves. (HINT: make sure your term insurance is convertible and with a company that has whole life insurance). This is another way to say that a person’s comprehensive financial blueprint should govern financial decisions, which leads me to my next point. Problem #2: Lack of Context Infinite banking, if right for you, should be just one piece of a much larger puzzle. It shouldn’t be the one thing you implement at the expense of other important things in your life. Your complete financial blueprint
I’m thinking of a number…
Why credit matters and what it takes to get the best rates available. Do you remember that commercial where the guy says he is thinking about a number between 500 and 800? He was talking about credit. If your credit is good that might not be enough. We have entered an age where it has to be great, but if it is you can look forward to cheaper insurance, lower interest rates and less hassle when you get a loan. 83 percent of Americans have an error on their credit report. ¼ of them are denied a loan they would have otherwise had. By simply having 1 additional point when closing on a loan it can be the difference of thousands of dollars in additional interest. So, whether you have good credit, or less than perfect credit – you may be unnecessarily leaking cash by not taking advantage of what is available to you through your existing lenders in today’s low interest rate environment. First, go to any of the credit monitoring agencies sites or google credit score and take a look at your credit. Do you see any errors? Misspelled name, wrong address, an account that doesn’t belong to you, or a late payment you didn’t know about. By clearing these issues up you can improve your score. Now, in the past 720 was a magic number for your credit, but if you can achieve 780 or higher there are simply better options and better interest rates available. After correcting your errors, now you can ask for better interest rates. For example: If you have credit card debt at an interest rate that was determined years ago or that was obtained when you may have had a lower credit score than you do now, you may be able to lower that interest rate. Just call up the credit card company and ask them to send you to the special promotions department or someone who can assist you in changing your credit card. This will send you to the right department that has the authority lower your rate. It’s as simple as knowing how to ask. Another case where using your credit can help you free up cash flow is in the case of a home mortgage. By calling up your existing lender and asking for a “streamline refinance” you may be able to lower your monthly payment with little cost and minimal effort! Simply ask your lender if you qualify and be sure that they understand that you may consider going elsewhere if they can’t help you. If the situation is right, your lender may lower your interest rate with little to no closing costs or without requiring full appraisal, or without you having to jump through the hoops associated with a conventional refinance. Always dress up your credit by monitoring and managing it properly. Then ask for lower interest rates, you could save hundreds (or more) of dollars per month on your existing debts! If you want to know 9 other areas where you can improve your credit, check out our Curriculum for Wealth series where I interview two credit experts and get right to the bottom of what to do. All the information you need in a concise and yes, this is bold, entertaining way. www.freedomfasttrack.com/cfw
The Roller Coaster of Collections | Where is My Money III
By Charles Pritchard The Ups and Downs of Cash flow Give a Chiropractic Clinic Owner Anxiety Which areas of Ben’s clinic are most difficult to track? The roller coaster of collections drove Ben up the wall. He never knew how many of his claims would get paid each month. Some months the money was pouring in like he had won the lottery, and then the payments would suddenly come to a screeching halt. The worst part was the uncertainty. It made him feel sick to his stomach. He felt like he could not even provide for his family’s basic needs, let alone treat them to the long-planned trip to Disney World. It almost seemed ironic that Ben’s wild ride of unpredictable cash flow prevented his wife, Carmen, and his son, Jonathan, from enjoying the rides at the theme park. Not surprisingly, Ben’s revenue issue was slowly killing his joy of practicing chiropractic. Not to mention how his bad mood put everyone at home on edge, too. “I just don’t get it,” Ben said as he helped himself to leftover lasagne. “Back in January, we were averaging around 325 patient visits per month. Over the summer, my clinic literally exploded with 487 patient visits. The last few months we have been averaging around 436, but strangely enough, our collections don’t match that one bit. Although this month’s number is close to what we got in January, I have no way of predicting what we might receive next month. It could be thousands of dollars less…. or we could hit the proverbial jackpot.” “I wish I could use my rolling pin to turn your collections into smooth pizza dough,” Carmen said, jokingly, while placing pepperoni and cheese on her homemade pizza crust. “Your billing issues remind me of a ball of dough. You can’t make pizza with it unless you flatten it out. And at my pizzeria, for example, I have to offer the kind of pizzas my customers like. Otherwise, no one will come back for more.” Ben chuckled and said, “You compare everything to pizza, honey. At least your customers pay you right away. Imagine waiting for two, three months to receive payment for a pizza!” “Hmmm,” Carmen said, while putting the pizza in the oven. “My suppliers might extend me a little credit, but I’m pretty sure I would have to shut down if I was stretched that thin.” “Well, that’s exactly what I have to deal with,” Ben said. “The insurance companies take their sweet time to pay up and I’m left standing in the rain without an umbrella, so to speak.” After dinner, Carmen gave Jonathan a bath and put him to bed. Ben read him a story to help him fall asleep. Then they sat down in the living room to continue their conversation from earlier that night. “You ever come up with a menu?” Carmen asked, as Ben handed her a glass of wine. “Isn’t that your job?” Ben said, sarcastically. “Do you want me to partner up with you in the pizzeria, or are you just out of ideas?” Carmen punched him in the arm, playfully. “Your menu of services, genius!” “What about it?” “OK, let’s look at it this way… how much do you make each time you see a patient?” “Are we talking about cold, hard cash in my pocket? About 30 bucks per visit. Why?” “When I created my bill of fare, I wasn’t just thinking about the kind of pizzas I like to make,” Carmen said. “I had to consider the cost of ingredients, time for preparing the dough, and the likelihood of people ordering it regularly.” “In other words, I should stick to my most profitable options, right?” “Something like that,” Carmen said. “Based on what I know, your services vary in time and equipment needed. Some of them may not even be in high demand. If you take an honest look at your practice, you can probably find some services that are not worth those 30 dollars– especially when it takes forever to get paid.” “So you think I should cater my clinic that way?” “There you go,” Carmen said with a wink. “On that note, I’m dying for a slice of pecan pie. Can I get you one, too?” Which areas of Ben’s clinic are most difficult to track?
