No matter where you work or what you do, you should never ever get ‘paid’ just once. The good news is that the number of ways you get paid is entirely up to you. No one else can prevent you from receiving these multiple payments. What I mean is that not all payments are necessarily monetary, although the non-monetary ones have the potential to be converted into monetary ones if you choose to make them so. The foundation for developing multiple income streams is having the right mindset, the mindset of always expecting to be paid in multiple ways. Let’s dive in. Here are the different ways a person can get paid.
Monetary Compensation for Work Done
This is the foundational payment. You work and you get paid for it. It doesn’t matter if you provide ‘fee for service’ and receive a percentage of collections, or if you work in a clinic or institution and get paid hourly or receive an annual salary, or if you have your own practice and keep the difference between revenues and expenses. These are all forms of compensated work. Now, we move on to the additional forms of payment.
Payment in What You Learn in Your Job
This payment is in the form of new knowledge acquisition. And, as we know, knowledge is power. “Power” means potential, from the Latin potentia. And the potential gained from newly acquired knowledge can be converted into many actualities, from greater life satisfaction to greater financial compensation.
To take advantage of this form of payment, when you go about your day-to-day work, it is important to approach it with an attitude of open curiosity and some degree of dissatisfaction from what is. From paying attention in this way, much can be learned about what works and doesn’t work in the work of treating patients and in the workings of ‘the system’ in which you find yourself.
When you approach patients with this open curiosity, dissatisfaction with the status quo, and a non-defensive attitude towards yourself, you are positioning yourself to improve your clinical skills. You can experiment with new approaches, expand your armamentarium, and have a keener sense of which factors affect treatment outcomes and can be better tailored to each patient’s treatment. You start to notice that you increasingly more deeply understand and can treat the problems faced by patients with, for example, ADHD, treatment resistant OCD, or autism spectrum. Pretty soon you have become an expert in the condition that is your focus, and the word gets out into the community. If you choose to do so, your practice becomes increasingly focused on treating this particular condition and your skill continues an upward trajectory. You have formed a virtuous cycle of skillful patient management that attracts more patients with the condition of focus which, in turn, provides you more and more experience in managing that condition.
Now, you can turn your newly acquired knowledge and skill into perhaps a much more satisfying and better compensated practice. And, if you choose to stay put, you can better negotiate a contract with your current employer.
Now, let’s shift to paying attention to how the system works. For example, after your training you may have joined a private group practice as a junior clinician. If you’re in this position, pay attention to how this practice runs. What works well that you can note and borrow for your own potential future practice? Equally importantly, what works poorly in this practice that you can now be sure to avoid in your future practice? You are reverse engineering the operations of a clinic or other clinical setting and becoming an expert in the way these systems run. You can then potentially take on a management role in a pre-existing system or open your own clinic.
Once you become an expert, either in patient care or medical management, you can turn that potential into income-generating activities. You can become a consultant to psychiatric practices. You can develop a side job as an independent medical examiner and evaluate people for eligibility for disability or clearance for return to work. You can do chart reviews for disability insurance companies or law firms involved in medical malpractice cases. Or you can consult with investment firms on the status of various pharmaceuticals and medical devices that have entered the marketplace.
For some clinicians, this type of work is so financially and otherwise rewarding that they gradually and fully transition out of clinical work. For many others, they maintain a side job to increase income and/or variety of their experiences.
Another way that increased competence can be converted into income-generating activities is producing something that generates money not directly tied to work. Even if you are a highly paid clinician or consultant, you only get paid for the you work you do. If you stop working, the income stops too. It’s nice to continue to get paid even when you’re sleeping, vacationing, out sick, or retired.
One way to generate a passive income is to develop an informational product and launch it into the marketplace. Many clinicians write books, for example. Books usually do not generate a lot of income, but they can increase the writer’s status, perceived expertise, and visibility to large numbers of people. The clinician-writer can then convert that newly acquired status into new opportunities, such as speaking or consulting gigs. While books usually do not generate much direct income to the writer, online courses CAN generate a lot of income. Successful informational products succeed when they provide very specific and practical advice to people who are desperate for help. One of my favorite examples was a teacher who launched an eBook and supporting videos on getting infants, toddlers, and young children to sleep. There are perhaps millions of parents with children that have problematic sleep patterns, and they often respond in ways that makes the problem worse. This teacher was selling about a million dollars a year of her sleep-related info products. I was one of her satisfied customers.
Profit is not the same as getting paid for doing work. Profit is when you have built an enterprise that generates money after all expenses and salaries are paid. If you have a solo practice or work in a larger practice that you built and own, your income from treating patients is NOT profit. That is payment for doing the work of treating patients. If you hire other clinicians and if the clinic generates money after all salaries and clinic overhead is paid, then that is profit. An easy way to tell if money is from profit is to assess whether it continues even if you don’t work. If it continues, it is profit. If it doesn’t, it’s work income. Note, however, that hiring clinicians and other staff to work in your clinic increases complexity, work for the owner, and risk. It may or may not be worth it, depending on the owner’s skill, motivation, and timeline.
Now, if you build a clinic or other enterprise that provides products and services and that generates profit as a result, this business now has its own value. It’s a profit-producing virtual machine and that profit-generation makes it attractive to potential buyers. A buyer, in effect, exchanges current money for ongoing profit. And as a seller you do the opposite, you exchange ongoing profit for current money. You can then use those current dollars to spend or to invest.
Note that the sources of income I’ve discussed often stack. If, for example, you build a clinic or other business, you can generate income for yourself by doing work in the business (treating patients and/or managing the clinic or other business), by generating profit every year, and by eventually selling it. And even before you sell it, you increase the value of the business by increasing the amount of profit it generates. The price of the business is often a multiple of the annual profit (or free cash flow, which is related).
So, irrespective of where you are in your career, I’d advise you to keep that sense of open curiosity and dissatisfaction with the way things are. Always be on the look-out for opportunities. One of my mottos is “There’s always a better way.” And if there isn’t, at least my mindset biases me towards seeing opportunities. Not all opportunities are, or need be, income generating ones. Life satisfaction is often even more important.
If you have questions particular to your situation, email me. I’d be happy to weigh in on your question in LifeBrief while keeping your name anonymous and eliminating possible identifying details. All I can say is that it’s fun to be open to possibilities and to see them all around.
“Not knowing when the dawn will come
I open every door.” ― Emily Dickinson
“Do not despise your own place and hour. Every place is under the stars, every place is the center of the world.” ― John Burroughs
“Opportunity does not waste time with those who are unprepared.” ― Idowu Koyenikan
“We often miss opportunity because it’s dressed in overalls and looks like work.” ― Thomas A. Edison