Today on the Podcast: Creating a Stronger Financial Practice in 2026
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About This Episode
Cash flow, reserves, and labor efficiency ratio….most PT owners didn't get into healthcare for this stuff — but it's exactly what separates thriving practices from struggling ones.
This episode, we sit down with Eric Miller, Chief Financial Advisor and Co-Owner of Econologics Financial Advisors, who's spent years helping hundreds of healthcare practice owners strengthen their finances and build lasting wealth.
We cover:
- Eric's #1 piece of financial advice for PT owners
- What financial strength really means for a practice
- The biggest financial challenges owners face in 2026
- Key metrics every owner should track (including labor efficiency ratio)
- Common financial mistakes that hurt long-term stability
- How to improve cash flow and build the right reserves
- Warning signs of financial trouble — and how to balance growth with stability
If you want a healthier, more resilient practice this year, this one's worth your time.
Want to get better financial advice for your practice? Contact Eric at https://econologicsfinancialadvisors.com/!
Listen Above or Read The Summary Here:
Creating a Stronger Financial Practice in 2026
Household First: The Key to Financial Success
Eric Miller, chief financial advisor at EconoLogic’s Financial Advisors, emphasizes the importance of prioritizing household finances over business finances. He advises practice owners to “learn to run your household like a business,” ensuring that the household is well taken care of financially. This mindset shift, where the practice serves the household, is critical for long-term success.
Neil echoes this sentiment, sharing how adopting a “household first” mentality transformed his financial outlook. “Your household comes first. That’s the bank that gets paid before everything else,” Neil asserts. This approach prevents the practice from consuming all available cash, leaving the household financially strained.
Aligning Practice and Household Finances
Eric warns against the misconception that financial independence should take decades to achieve. He believes that with proper alignment between practice and household finances, owners can achieve financial freedom in 7 to 10 years. “Your household should be financially free, where you don’t have any debt, where you have plenty of money in reserves,” Eric states.
Neil and Eric discuss the importance of assigning money a purpose to prevent it from disappearing. Eric notes, “Assign money a purpose. That is an immutable law.” By doing so, practice owners can ensure that funds are allocated effectively, supporting both business growth and household security.
Implementing Effective Financial Systems
To build a robust financial foundation, Eric and Neil suggest setting up multiple accounts to manage finances systematically. Neil shares his experience with the Profit First methodology, advocating for separate accounts for taxes, reserves, and operations. “Every week, a certain amount goes right in the tax account, it goes right in the reserve account,” Neil advises.
Eric highlights the importance of having a reserve account, stating that practice owners should have at least two months of business reserves. He also stresses the need for a tax account, as many owners overlook this critical component.
Neil and Eric agree on the necessity of knowing your worth and understanding the financial demands of your practice. By working backwards from household needs to business revenue, owners can make informed decisions about pricing, marketing, and operational efficiency.
Building a Profitable and Sustainable Practice
Eric advises that a strong financial practice should return at least 20-25% profit margins. He warns against accepting low profit margins, noting that they hinder reinvestment and personal financial growth. “You have to make sure that this business is returning 20, 25%,” Eric asserts.
Neil highlights the importance of diversification in revenue streams, both in terms of payers and services offered. He suggests that at least 10% of revenue should come from non-reimbursed services, enhancing cash flow and increasing per-patient revenue.
Finally, Eric and Neil discuss the significance of financial education for practice owners. Understanding financial terminology and metrics, such as labor efficiency ratios and capacity levels, empowers owners to make strategic decisions that enhance profitability and sustainability.
By adopting these financial strategies, private physical therapy practice owners can achieve both business success and personal financial freedom, creating a practice that truly serves their lives.
Common Questions Practice Owners Ask About This Topic:
- What are the best financial strategies for physical therapy practices?
- How can PT owners improve cash flow and reserves?
- What financial metrics should healthcare practice owners track?
- What are common financial mistakes in healthcare practices?
- How to achieve financial stability in a chiropractic practice?
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See how the right marketing ideas can help you grow your Physical Therapy or Chiropractic clinic