Welcome, wellness entrepreneur! In this blog, we’re diving into the important components of creating a solid business foundation. As health coaches, you understand the importance of a solid foundation in achieving optimal health. It’s the same with starting and running a business.
If you’re a new health coach, this will help set you up to succeed. If you’re a veteran health coach, use this to fine-tune the foundations of your business to ensure nothing slips through the cracks.
These are not optional; each component below is a non-negotiable for ensuring your business is set up correctly and legally.
Disclaimer: This blog's information is for educational purposes only and is not legal or tax advice. We recommend speaking with licensed professionals in each area to create the best plan for you and your business.
Business Financial Structure & Stability
Proper accounting practices ensure you accurately track income and expenses, manage cash flow, and make informed financial decisions. It also allows you to optimize your tax strategies, take advantage of tax deductions, and meet tax obligations on time, reducing the risk of fines or audits.
Effective financial management, including budgeting and forecasting, contributes to your health coaching business's long-term viability and sustainability.
We recommend using software like QuickBooks to keep track of your income and expenses, as well as speaking with a tax accountant to determine which business structure is best suited for your business. This will allow you to maximize your tax benefits as a small business owner.
They can also help you decide how much money to put away each month to save for tax time.
You’ll also want a business bank account and credit card to separate your personal and business expenses. The cleaner and more separate they are, the better. Keep ALL receipts.
Accounting is something you want to avoid messing around with. We’ve seen many businesses fail because they weren’t properly planning or paying attention to their finances.
Business Legal Protection
As health coaches, we operate in a semi-unregulated industry that brings many layers of risk.
We recommend getting your legal agreements in place to protect yourself and your business, protect your peace of mind, minimize stress, and set yourself up with solid foundations.
You can do this in 1 of 2 ways.
- Speak with a lawyer who specializes in supporting the health coaching industry.
- Purchase a health coaching legal bundle with the agreements your business needs.
You can read our blog, The Legal Essentials Every Health Coach Needs, here to learn more. This blog gives you our recommendations for both options above.
Clients are also more likely to trust health coaches who adequately comply with legal requirements, including those for their privacy. Ensuring you follow the law regarding your client's privacy is vitally important. Many new businesses don’t realize the importance of having the most basic agreements on their website, but these are legally required!
These add credibility and professionalism to the business and increase trust.
Again, check out our blog for all the details and to get yourself and your legal foundations set.
Compliance With Regulations
Health coaching businesses must comply with various regulations, including those related to healthcare privacy (HIPAA), business registration, and tax obligations. Non-compliance can lead to legal penalties and reputational damage.
Make sure that whatever software you use to communicate with your clients is HIPAA compliant, that you’ve registered your business, and that you have spoken with a tax accountant about your taxes.
If you’re using a practice management system, ensure it is HIPAA-compliant. We recommend using our Ayubowan platform to manage your clients. Information on how to access and use this platform lives inside your student Portal.
Appropriate insurance coverage, such as professional liability insurance, protects health coaches from legal claims and lawsuits. It protects personal assets and the business’s financial well-being in case of unexpected events or disputes.
We recommend checking out an insurance company specializing in our industry, such as Alternative Balance.
Trademarking & Protecting Your IP
If you’re passionate about your brand, logo mark, and any intellectual property you’ve created, you’ll want to consider trademarking it. This will lower the risk of losing it down the line or having your intellectual property knocked off. You don’t want to have to start over after all the hard work you’ve put in. We’ve seen this happen countless times.
Reach out to Cory at Conscious Counsel to start the trade marking process.
Putting It All Together
A good business foundation in accounting, insurance, and legal aspects is essential for a health coaching business's financial stability, legal compliance, risk mitigation, and overall success. These foundations can build client trust, protect the business from potential challenges, and ensure it operates ethically and responsibly in the competitive health industry.
If you have additional questions or would like recommendations, reach out to [email protected].