Break-Even Social Security Disability Advocacy: $466K/Month

Fixed costs $30.3K/mo Overhead plus payroll

Contribution margin 73% After variable costs

Break-even revenue $41.5K/mo Revenue needed monthly

Break-even timing Month 9 Model break-even point

Break-even calculator

Use this to test monthly revenue against variable expenses and fixed costs, so you can see where break-even lands.

Lean Base Full

Monthly revenue Revenue is the cash coming in each month before direct costs. $ Low volume High volume Variable expenses These are the costs that rise with each new case. $ Low direct costs High direct costs

Money available to cover fixed costs $64,100 $86,100 revenue - $22,000 variable expenses

Margin ratio

74%

Covers fixed costs

Yes

Fixed monthly costs These are the monthly costs you pay even when case volume is flat. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses are fixed and which move with case volume in a disability advocacy practice?

Cost classification

Break-even is more reliable when overhead is separated from per-case spending. For this model, that matters because break-even lands in Month 9, and misclassifying case-driven fees can overstate margin early.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Include $3,500/month in monthly overhead before calculating required case revenue.	Treating rent as lower when intake volume drops.
Professional Liability Insurance	Fixed	Include $650/month as recurring overhead across the planning range.	Spreading it per case and understating low-volume break-even.
Secure Cloud Storage and Cybersecurity	Fixed	Include $500/month as baseline operating overhead for secure case handling.	Modeling it as a per-client fee without usage data.
Advocacy and Case Staff	Semi-fixed	Add salary capacity in steps as headcount grows; first-year salaries include $115,000 for the lead advocate, $65,000 for the senior case manager, $55,000 for the paralegal, and $42,000 for intake.	Assuming payroll rises smoothly with every new case.
Medical Records Retrieval Fees	Variable	Apply 8% of first-year revenue as a direct case-related expense.	Putting records fees in overhead and overstating contribution margin.
Vocational Expert Testimony Fees	Variable	Apply 5% of first-year revenue to reflect case-driven expert support.	Ignoring expert fees until appeals volume is already high.
Referral Partner Commissions	Variable	Apply 10% of first-year revenue when estimating contribution after client acquisition channels.	Counting referred cases as full-margin revenue.
Online Marketing Spend	Semi-variable	Plan the $45,000 first-year budget, then test volume using the $450 customer acquisition figure.	Treating the whole budget as fixed and ignoring acquisition efficiency.

How does break-even shift from lean to full scale in disability advocacy?

Scenario table

Break-even improves as the case mix shifts toward higher-value work, but staffing and fixed overhead also rise, so the break-even line moves up too. Year 1’s blended service value is about $812.50.

Planning assumptions only; actual claims volume, approvals, and case mix can move break-even.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch model	$40.7K	$11.0K	$37.1K	73.0%	-$7.4K	Still under break-even, so cash stays tight until volume lifts.
Base operating model	$86.2K	$22.0K	$47.7K	74.5%	$16.5K	Break-even is reached, but fixed staffing still caps profit speed.
Full scaled model	$281.8K	$56.4K	$87.9K	80.0%	$137.6K	Higher staffing lifts the break-even line, even with a stronger margin.

What breaks first if lead flow slows, cases get heavier, or overhead rises?

Stress test

The current plan still has a roughly $71K annual gap to a $559K break-even point. Lead flow is the first weak spot, but heavier cases and higher fixed payroll can push break-even past Month 9 and tighten cash fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$559K	$71K gap	Year 1 revenue still misses break-even.
Revenue shortfall	Lead flow slows, and Year 1 revenue drops 10% to $439K.	$559K	$120K gap	A small demand dip widens the hole fast.
Fixed-cost pressure	Year 1 fixed payroll and overhead rise 10% from the listed base.	$615K	$127K gap	Higher overhead pushes break-even farther out.
Margin pressure	Variable expenses rise from 27% to 31% of revenue.	$591K	$103K gap	Heavier case work cuts the cushion.
Combined pressure	Revenue falls 10%, fixed cost rises 10%, and variable expense load rises to 31%.	$650K	$211K gap	This is the case that can push cash need beyond the Month 8 peak.

Is this practice ready to carry rent, hires, and marketing to Month 9 break-even?

Founder checklist

Before you lock in fixed costs, check that the pipeline, pricing mix, and staffing can hold through Month 9 break-even. The model bottoms at $802K of minimum cash in Month 8, so you need a real buffer before the office and hiring spend harden.

1Signed Pipeline100 clients

Confirm you can sign about 100 clients from the Year 1 marketing budget at a $450 CAC, or the acquisition plan will not cover the spend.

2Fixed Overhead$5.6K/mo

Make sure the office and operating overhead stay at $5.6K a month, including the $3,500 rent and $450 utilities, before you commit to the space.

3Margin Mix73% CM

Check that direct costs still leave about 73% contribution margin, the cash left after service costs, in Year 1.

4Case Load4.5 FTE

Keep Year 1 work inside 4.5 FTE and use the 3.5-hour application, 6.0-hour appeal, and 1.5-hour consult load to decide when to add staff.

5Cash Runway$802K

Hold $802K through the Month 8 low point, because the model does not reach break-even until Month 9.

6Launch StackMonth 1

Confirm the case management software and secure cloud storage are live in Month 1, so intake, documents, and follow-up do not choke the first cases.