The Ultimate Guide to Starting a Private Practice in Counseling
Takeaway: Exploring the idea of your own private counseling practice can be both daunting and exciting. In this post, I’ll break down everything you need to know in order to start a private practice: how to tell if you’re ready and what tangible steps you can follow to get your business up and running.
For many therapists, starting a counseling practice is the ultimate goal. After all, having your own practice means you get to set your own schedule, choose who you want to work with, and control every aspect of your business.
With that being said, the process can feel overwhelming-especially if you're not sure where to start. I definitely didn’t know where to begin when I started my counseling private practice in California. The anxiety and doubt can feel really tough to overcome, trust me, I’ve been there.
Thankfully, I learned a thing or two through my experience. Now, I have an established therapy practice in California that continues to grow and evolve with me. I've also had the privilege of helping hundreds of therapists build thriving, modern private practices.
Here, I offer a step-by-step guide for building your counseling private practice from the ground up.
Let's get started!
THINGS TO CONSIDER BEFORE STARTING A PRIVATE PRACTICE IN COUNSELING
Deciding to start a private practice is no small decision. Before diving in, it's important to consider all the different aspects to make sure that you're ready.
Of course, there is no right or wrong time, motivation, or approach to opening your private practice. However, getting clear on your needs and goals can help you make an intentional choice that's aligned with your values.
1/ logistical considerations to start a private practice
There are a ton of logistics to navigate when starting a private practice. After all, counseling practices are businesses, too!
Like any other business, there are financial, professional, and legal requirements that you must adhere to. Having a clear sense of these components before you get started can help you feel more organized moving forward.
2/ get a sense of the requirements for private practices
The requirements for opening a private practice may vary from state to state and even from profession to profession.
When in doubt, I recommend consulting with an attorney in your area. They can give you information about what local zoning laws influence where you can see clients, if you need a business license, and more.
Generally speaking, though, there are some common requirements for starting your private practice. For example, you'll likely need a master's degree in counseling (or a related field like social work, marriage and family therapy, psychology, or art therapy).
You'll also need to choose which type of business to register as: sole proprietor, LLC, or a Corporation. (Some states have special rules regarding what type of business entity you can register as, for example in California licensed providers must register as a Corporation).
These are just a few of the main requirements. For even more things to consider, check out my blog post on the requirements for starting a private practice.
3/ figure out where and how you'll see clients
In recent years, telehealth has become more popular for therapists in private practice. However, you may decide to offer in-person appointments.
When establishing your counseling practice, you'll need to decide whether you'll see clients in an office, through virtual sessions, or some combination of both.
Once you make your decision, you can determine what kind of office space you need. Will you rent an office? If so, will it be your own space or will you sublet an office a couple days a week?
If you choose to offer online therapy, where will you conduct your sessions? Does your home office have adequate space, soundproofing, and internet connection? All of these considerations (and more) must be taken into account when deciding where and how you'll see clients.
4/ calculate your income and business expenses
As with any job change, it's important to keep your financial goals in mind. This is especially true for small businesses since you're in full control of how you run your practice-including setting your rate.
When deciding how much to charge per session, you'll want to consider how many clients you want to see, what expenses you have (including insurance, rent, marketing costs, as well as personal expenses and any other costs you have), and what your financial goals are.
While you can always adjust your rate later, your business can run smoother if you're intentional about your finances from the start.
mental and emotional considerations for starting a therapy private practice
Becoming a private practice owner is a big deal. Beyond all the logistics, there's also the mental and emotional aspect of owning your own practice. Before diving in headfirst, consider the potential shifts you'll need to make.
THE PRESSURE OF BEING YOUR OWN BOSS
Most of us have been employees for all of our working lives. As with any job, there are benefits and challenges to working for someone else (especially for an agency).
The same can be said for running your own private practice. Being your own boss can be freeing, but it can also come with a lot of pressure. You're solely responsible for the success of your business.
Attracting potential clients is up to you. You're the only person enforcing your policies. And, unless you hire someone, the bookkeeping, billing, and marketing efforts are all your responsibility as well.
This is a lot of pressure. While I'm confident that you can do it, you want to make sure this feels right for you with the stage of life you're in. Only you can determine that.
SHIFTING INTO A BUSINESS OWNER MINDSET
If you decide that private practice is for you, I encourage you to step into your power as a business owner.
When I was first building my business, this felt really intimidating. Self-doubt and imposter syndrome and perfectionism all kicked into overdrive-who did I think I was, starting a private practice?!
Through internal work and shifting my mindset, I was able to embrace my role as a business owner. My hope is that you, too, can feel confident making business decisions that support your professional goals-and your mental health.
BUILDING A SUPPORT NETWORK OF OTHER THERAPISTS
Don't get me wrong, owning your own business can be incredibly empowering. However, it has its tough days, too. As you know firsthand, working in the mental health field can be rewarding, draining, unpredictable, fun, and emotional-all at the same time.
That's why it's so important to get support from other therapists-especially other private practitioners. Who can you call when you've had a tough day? Who can you consult with when you run into a tricky ethical dilemma? Who can you refer clients to?
Having these people in your corner can help ease the transition into private practice and make it sustainable in the long run.
HOW TO OPEN A PRIVATE PRACTICE IN COUNSELING: A STEP-BY-STEP GUIDE
Graduate school gave you the skills you need to be an excellent therapist. However, it (most likely) didn't give you the business acumen to help you start a private practice. Here, I've laid out a step-by-step guide to help you get your business up and running.
1. create a business plan for your counseling private practice
Your business plan is essentially an outline for your practice. It should include all the details of your business, such as:
Your mission statement
Your ideal client
What services you offer
Your marketing plan
Financial, legal, and other logistical practice concerns
For a full rundown on what to include in your private practice business plan, check out my free template here!
2. register your private practice
Like we covered earlier, you'll need to register your business in order to start seeing clients. Depending on your business structure, you may need to request an Employer Identification Number (EIN) from the IRS.
You'll need a business name in order to register your practice. You can check with your state directory to see whether or not a potential business name has already been taken.
If you choose to accept insurance, you'll also need to request a National Provider Identifier (NPI). This allows your clients to submit insurance claims for their sessions. You can also choose whether to panel with an insurance company or be an out of network provider.
3. open a business bank account
Once you've established your new practice, you can open a business bank account. Making a business account helps keep your finances separate, which is important when it comes to paying your taxes.
Make sure to use this bank account for business expenses only. Your work cell phone or other phone system, office rent, credentialing costs, insurance, and even your office furniture all count as business expenses.
4. get insured
Many private practitioners have both professional liability insurance (malpractice insurance) and general liability insurance for their business.
Malpractice insurance covers potential litigation fees, while general liability covers any accidents or injuries that might occur at your office location.
5. find office space
When making your business plan, you determined whether you'll see clients in person or online. If you chose to find an office space, it's time to start looking. When selecting an office space, consider whether it has a waiting room, where your clients will park, etc.
If you chose to work from home, make sure that your space is conducive to facilitating virtual therapy sessions.
6. set up logistics
After you figure out your location, you can move onto some of the day-to-day logistics of your therapy practice. Choosing a practice management software is one of the big ones.
There are tons of different programs you can use. Many therapists enjoy using all-inclusive platforms such as Simple Practice.
These programs serve as a place to keep your therapy notes, send clients paperwork like forms and office policies, provide automated appointment reminders, and more.
7. get started on marketing
Now you're ready to start attracting prospective clients! Think about where your ideal clients show up.
Are they using Google to find a therapist? Consider using Google ads or search engine optimization to help them find you. If you think you'll attract more clients through social media, think about what platforms they might use.
Bonus: WAnt even more tips on starting a private practice? sign up for my email list to get my comprehensive guide!
ADDITIONAL RESOURCES TO HELP YOU START PRIVATE PRACTICE
Looking for more support with the business side of starting your own private practice? I'm here to help. I'm passionate about helping fellow therapists like you craft the modern private practice of your dreams through coaching and my modern private practice course The Crafted Practice (I also have an Established Therapist Toolkit for the therapist who has all the start up already is just looking for the modern marketing and diversifying income support!)
I also have a free PDF guide to get you going, check out my Starting a Counseling Practice Checklist and the free Business Plan for Therapists.
I'd be happy to help you navigate launching your own practice. From deciding whether to join insurance provider panels or stick with private pay to creating your marketing plan for attracting new clients, I'm your guide.
Coaching not your thing? I have many resources on my website that you can access right now. I'd also love to hear from you directly-reach out today to start the conversation.