Before we dig in to the costs of starting a private practice, we want you to remember that most small businesses invest tens of thousands of dollars into just basic start-up costs. A small training gym can easily spend $20k-50k on start-up, bakeries can spend $100k, restaurants $50k-200k, technology start-ups $10k-500k, and day spas $8k-80k.

But, we have GREAT news for you today. The cost to start a counseling or psychotherapy practice is MUCH less than most other types of businesses!

A place to practice. That doesn't necessarily mean a traditional, full-time office. Therapists are practicing over the phone, doing walk and talk therapy, doing virtual therapy, and subletting office space by the hour. Check into subletting when starting your private practice, many therapists find they can get started for under $100 a month if they research and negotiate well (that number can vary based upon your area). Subletting means no need for décor, couches, etc. Some will even let you graduate up- meaning you only start paying for the space when you begin to get clients. (I didn’t pay a dime for office space prior to seeing clients, and then paid an hourly fee up to a max of $75 a month for renting a space a couple night’s a month). Investment: $200/month > Download our free Office Space Checklist

> Get information about going back to the office after quarantine

Business Licensing Fees. Depending on your location, you may need a business license. Contact your city to find out. The average business license is under $100, and not all cities require them. Investment: $100 startup

An EIN and NPI number. These actually aren’t even completely required if you are running a cash-pay practice, but they won’t hurt! They are both free, can be grabbed online in a few minutes, and are needed if you are going to provide CMS-1500 forms or superbills for your clients to get reimbursed, or if you are going to work directly with insurance companies. Get your EIN here and your NPI number here. Investment: $0

Liability insurance. Whether you are in private practice or doing agency work- I recommend you have liability insurance. Many insurance plans allow for a certain number of clinical hours in private practice without increasing your annual fee. You can also get general liability insurance on top of your clinical liability insurance. To be honest, I didn’t do that initially. I felt like if I wasn’t making a lot of income in the beginning- why would it help for them to sue me! However, look at your particular situation and make a decision based on what is right for you. Investment: $450 annually (even with the fancy general liability insurance)

Clinical forms. You need to get your informed consent and policies together. many professional organizations like the California Association of Marriage and Family Therapists (CAMFT) make templates available for their membership, and some will even review your paperwork as a part of your annual membership. If you develop an online practice process, you can have clients sign online- so you may not even have any initial printing costs: Investment: $0

A business line. There are call forwarding services that allow you to get a “number” for your clinical practice and have that forwarded to your mobile phone. Avoid having to carry two phones around if you can, and avoid that extra cost of an extra cell phone. Some services allow you to send calls direct to voicemail outside of business hours so you don’t have to worry about your personal mobile ringing constantly. Many therapists starting out use Google Voice to get a free line. There are some grey areas in regards to using this service. Worst case you can get a service that is explicitly HIPAA compliant for under $10 a month. Initial Investment: $0; Monthly fee $10 (plus the the cost of your current cell phone)

A secure e-mail account. You can use GSuite to get started with a business based e-mail that is HIPAA compliant for $50 a year. Investment: $50/year

A website. We love using Squarespace for a website. It includes all of your hosting, security, and gives you access to numbers you can track to improve the success of your website. You may have heard that you MUST use WordPress for your website, but for most therapists that isn’t a good use of time or budget. The HARDEST part of your website is developing your voice and your practice vision. It can be expensive to have someone else uncover that with you and ghost write for you. You don’t have to have a website to be able to see clients, but it REALLY helps in getting new clients when done well. Investment: $16/month > Take the free Websites 101 training

> Get our free Websites Resource Guide

Practice Management System. Many people don’t believe you need to start with a practice management system. I will tell you it is an absolute necessity. It is your HIPAA compliant, completely secure portal for clinical notes, will keep all of your financial information organized (invaluable), lower your no-show rate, allow you to take credit cards, avoid printing costs, and so much more. Our current faves for private practices are Simple Practice and TherapyNotes Investment: $39/month

Referral source(s). You need a way to get clients. I built my private practice on 95% referrals from the internet. I was newly licensed and wasn’t super well known in the community. There also wasn’t much competition to get to the first page of Google. I have colleagues who built their practice on a specific referral source initially- an adoption agency that they worked for previously. While paid therapist listings can be a piece of the puzzle, it is possible to get a steady stream of clients with good ol’ fashion networking and in-person relationships. (Although, having a way for people who hear about you to Google you and find an awesome website works a bit better!) The more saturated your market, the less specialized your work, the more competition for the first page of Google. When you sign up for your practice management system you will get a 6 month free trial with Psychology Today. Here is a link for 6 months free on Psychology Today. Some of the best referral sources you will have in your career will be built on relationships. Relationships don’t usually cost anything. Investment: Time! Top Tip: Focus your efforts on SEO or in-person relationships based on what is the most direct way for you to get new clients in your area, for your specific specialization. Are there a few dozen therapists with your specialty already on the first page of Google? Consider focusing on relationship building in a unique way. Is the first page empty of any other therapists? Start writing a blog per week on that topic until you see yourself on page 1, and then you can move to monthly or less. > Get our list of 39 places and ways to build a referral base

Printer. Having access to a printer for receipts isn’t a direct necessity with a practice management system that can e-mail receipts- but it is a nice back-up. Does your sublet include a printer? Awesome! Score! Not so much? Bummer! Grab a printer that is wireless, can copy, print, scan, and e-mail. Investment: $100

Computer Access. Must you have computer access to start your private practice? Not really. However, I think it is good business practice. Being able to Google resources, type up notes on the spot, and access your practice management system at the office will make life easier. However, that could be done via a desktop, laptop, tablet, or smartphone. Start initially with tech you already have. Worst case? Buy a Google tablet or Chromebook if you absolutely don’t have anything else you can use. Investment: $250

Internet Access. While it isn’t an absolute necessity to have internet access to start a private practice, it sure does make things a bit easier. Your office may come with wi-fi access, your smartphone may include internet access by turning it into a wi-fi hotspot, or you may need to get separate internet access. This may be something you want to specifically check in on with potential office spaces and choose a space that does include internet access. Worst case, check out FreedomPop and get started for less than $20 a month. Investment: $20/month

Business Cards (Maybe). To be honest, I’ve seen too many people focus on business cards for hours, weeks, months… Want to build a strong base of referrals? When you meet people, grab their business card and send them a personal note via email or text with all of your contact information (so they can easily search their e-mail). Get out there and build relationships! Investment: $50

Professional Associations. Truth is, you probably already have these. If you don’t, you may or may not benefit from grabbing this now! Check to see if you get a discount on your liability insurance through your professional association. In California, to join www.camft.org is $200 the first year. For that $200 you get unlimited phone calls to speak to a lawyer with any questions you have about your practice, client situations, etc. Ask around and ONLY invest if there is direct value. Investment: $30

Trainings for Success. You can get over 12 hours of free webinars, checklists, and worksheets for therapists from our Private Practice Library. These trainings are designed to help set you up for success in your business by taking you step-by-step through developing a strong foundation, identifying the needs of your unique practice, and putting good business habits in place from the get-go. Investment: $0 > Join the free Private Practice Community and get access to all of these trainings and more

> Check out the free webinar on starting a private practice from scratch

> Download your private practice checklist to get clear on what you want in your private practice