4 Questions to Ask Before Starting A Private Practice
Starting a private practice is an exciting step. Finally, you get to be your own boss, set your own schedule, and do therapy your way!
But before you make the leap, there are some basic questions to ask yourself to to make sure you’re prepared for success:
Do I have enough money?
“woman, thinking” ©2011 Robert Couse-Baker CC BY-SA 2.0
When you’re starting a private practice, the most important thing is that you have enough money to pay your bills. Whether you have another source of income or can save enough to sustain yourself, make sure you’ll be able to survive until you start turning a profit.
To determine how much money you need, you should make an educated guess on how long it will take for your practice to become profitable. QuickBooks has a good guide on how to do that.
How much money you need will affect your answer to the next question:
Should I start my practice full-time or part-time?
You probably want to focus all of your energy on starting your private practice. But it might make sense to go part-time; starting your practice on the side while you’re still working for someone else. This path can have its benefits, too.
With enough savings to sustain yourself until profitability and a solid referral network, or if you can get the proper sized loan, going full-time is probably your best option. This way, you’ll have more time to focus on all the aspects of running your business (more on this in a minute).
If you’re not financially prepared to face that lack of income, and you still need to establish your client and referrals, it may make sense to work at a group practice and slowly start your private practice on the side. This way, you’ll still have a steady source of income and perhaps benefits to support yourself. There will also be more chances to see patients and establish yourself with other therapists and physicians.
Before you start a private practice, though, check your contract for a non-compete clause. The last thing you need is to suddenly lose that additional income because you violated your contract.
No matter what your answer to this question is, make sure to keep in mind the next one:
Do I have time?
Whether you’re full-time or part-time, running your practice will take more time than you think.
It’s not just about seeing clients any more. When you’re starting your practice, your time will be consumed by a lot of other tasks like filing for a tax id, getting credentialed if you haven’t yet, setting up your website, marketing your practice, creating a website, and deciding what you’ll use to manage your health records.
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If you’re part time, you’ll have to be especially conscious of how much time you’ll devote to your other job versus your new practice.
Do I have enough experience?
Even if you’ve been practicing therapy for years, there’s a definite learning curve to starting your business. The good thing is there are a lot of people out there who you can rely on to help.
The first place to look is your peers. More often than not they are willing to help other entrepreneurial-minded mental health professionals like yourself. The best way to get connected to them is through your professional association. A quick phone call or email will most likely get you connected to the people who can help you the most. Another source of information would be practice groups on Facebook or LinkedIn. Regardless of how you connect, the more people you talk to, the more information you get, and you may also be making a referral connection as well.
There are also a number of resources online that can give you tips for starting a business, like this one from the U.S. Small Business Administration and another from BizFilings. Of course, there are many more one web search away.
When it comes to the nitty gritty tasks like creating your LLC or decoding your tax requirements, you should find a small business accountant. They’re not cheap, but it’s worth it to get everything done right the first time instead of fixing it later.
We love to see therapists striking out on their own, being successful, and helping clients. Just be prepared when it’s time to make that leap whether it’s tomorrow or a few years from now.