The Business of Practice

How to Start Your Own Private Practice in Counseling & Psychology

Opening up your own private counseling practice is a great step to take in any mental health professional’s career. Though the steps involved may be intimidating, it gives one a great opportunity to operate on your own terms. It is your personal preference on how you go about helping people and which therapeutic techniques you choose to leverage. It’s also your own business to run as you see fit, meaning flexibility in structure and schedule.

However, though you may have a solid idea of what kind of therapeutic practice you want to open, you may have some questions on how to run a business.

How to Start Your Own Private Practice in Counseling & Psychology



Opening a practice requires business acumen and adds a laundry list of new responsibilities related to your career and life. You must be aware of the challenges, and create a game plan for how to work through opening your practice. 

Speaking with those that have opened their own practices is a great way to get an understanding of the pros and cons. Examining the pros and cons will help you determine if it’s the correct next step in your career. Take some time to think through your own extensive list of pros and cons. Examining them will help you determine if it’s the correct next step in your career.

A few pros include:

  • Flexible schedule
  • Choice of clients
  • Complete autonomy – you get to run your business, your way!

A few cons Include:

  • Marketing and business acumen required; may require additional training
  • Start-up costs (including real estate fees, additional staffing, insurance and taxes)
  • Less security 

Dr. Yotam Heineberg, Psy.D. and clinical faculty member at Palo Alto University’s Gronowski Center, had to consider these pros and cons when he started his own private practice. Given that he launched his practice with a strong network, 6 years after earning his license, he was “surprised the first few months were not full with clients.”  

In fact, “it took a little while to fill up…I now know that part of filling up a private practice has to do with investing in online marketing. But the biggest pro is touching people’s hearts, helping as a life mission, and growing while helping others grow.”



Just like any other business, a private practice requires a solid business plan for success. A well-thought-out business plan will serve as a guide during the creation and expansion of your practice, and help you make critical decisions in line with business goals.

  • Write a mission statement that describes your reasons for running a practice, how you plan to help clients, and who you hope to serve.
  • Make sure to include any values that are fundamental to your mission.
  • Keep the mission statement brief and easily digestible.

When it comes to financing your business, there are many aspects to consider as you craft your business plan.  Below are a few questions to ask yourself:

  • Will you fund out of pocket or seek a loan to start your business?
  • How much money do you need to make each year to keep the business going?
  • How much money do you need to expand the business? Consider marketing costs required to expand awareness.
  • Do you have a financial buffer?
  • What are your financial goals for the first month, first year, and first 5 years?
  • Will you need to hire someone to manage your finances?
  • How much money do you need to make in order to pay off the loan in the established timeframe?

It’s helpful to enlist the help of a professional when considering financial aspects, as this is a vital part of your business plan to thoroughly think through.

Marketing Strategy

  • Think about what kind of client base you hope to serve, and how you can connect to referral sources. What are the qualities about your practice that stand out that you can leverage in a digital setting? How much money and time are you willing to invest in a digital presence?
  • Once you have an idea of who your client base is, where your key differentiators exist, and how you hope to leverage your digital presence.
  • Create a website, a Psychology Today profile, and social media presence to help drive traffic and raise awareness of your private counseling practice.  
  • Make your practice purpose clear, ensure resources and info about the practice are easy to find and create a clear path for clients to engage with you via readily available contact information.
  • Once you have an idea of who your client base is, know where your key differentiators exist, and how you hope to leverage your digital presence. Create a website and social media presence to drive traffic and raise awareness about your private counseling practice.
  • Referrals: Clients will come and go, so it’s important to have a strategy to continuously fill up empty appointment slots. Ensure you have a strong referral pipeline to tap into when a client moves on. Make sure you don’t take the eye off the ball when y our practice is full, as that can easily change at any time.

  • Website: Your website should be intuitively designed to reflect the digital presence of your practice. Investing effort and time to get a well-functioning and nicely designed website will pay off for years, attracting new clients and partners alike. There are many things to consider when creating a website, so it’s best to consult more information on how to create a  website before driving in. Consider using a tool like WordPressSquarespace, or Wix to build your site.

  • Psychology Today Profile: Potential clients will use this site to search for therapists, so it is a great way to let people know about your practice. With this in mind, be sure to craft your profile for a particular type of client, describing how you can help them. Remember to demonstrate understanding, relatability, and be sure to avoid including a laundry list of qualifications or using too much jargon. Lastly, include a call to action that lets them know what to do next–should they call you? Email you? Be specific.

  • Social Media Presence: Social media should meet your customer where they are. Consider the tone you will display on Instagram, Facebook, and other popular platforms. Update often, and provide helpful information that you believe relevant to your client base. And just like your website, it’s best to do some research into a successful social media strategy before diving in.

Business Goals

  • Create a list of goals for 6 months, 1 year, and 5 years out that you can revisit and use as a reference guide for growing and maintaining your practice.

  • Make sure those goals are specific and attainable.

  • Include a mixture of short-term and long-term goals that align with where you want the business to grow.
  • Once you’ve created a business plan, make sure you consider a way to track and monitor your finances and goals against the plan to ensure healthy business movement.



In today’s continually changing world, you have a wide array of options when it comes to where to practice. For Dr. Yotam Heineberg, virtual therapy offers a lot of valuable flexibility, but “the magic of in-person presence cannot be matched.”

When deciding between a  physical location and a remote option, consider the following:

  • Where is it easiest to meet your client base?
  • Are there specific needs of your client base that require a physical location vs. an online option?
  • Do you plan on offering a hybrid office setting, both online and in a physical location?

If you choose to go with a physical location, the environment is everything. Creating a safe and comfortable environment is vital, but there’s no need to overspend in this area. A home office can work just as well as a nice rented space in an office building, as long as the space provides a calming environment for clients. Calming elements include:

  • A secure, confidential space
  • Cozy and inviting furniture
  • Calming colors
  • Elements of nature (plants, images of nature, etc.)
  • No loud noises or phones
  • Ease of parking might also be a factor to consider, if in a larger city setting

If considering online options, there are many online portals that can be leveraged by physicians. Healthline provides a great roundup of online psychiatry services for reference. There are also courses available to help prepare you for a virtual environment, including:

  • Foundations in Digital Therapy
  • Technology and Mental Health for Children & Adolescents
  • Evidence-based Internet Interventions to Reduce Health Disparities



A private practice is a business and is therefore regulated by local and state laws. It is vital to ensure the practice is compliant with regulations, so it’s a worthwhile idea to enlist the help of both an attorney and an accountant. They can walk through requirements, and help you decide what type of business structure fits your business needs, and provides the correct type of liability protection.

Below we outline the most common business structures for private practice:

  • Limited Liability Corporation (LLC):  An LLC is the most popular business structure for a private practice in counseling. LLC’s do not require business owners to pay corporate taxes and provides reduced liability risk compared to other business structures. In an LLC, the assets and liabilities are considered separate from the practitioner.
  • S Corp:  An S corp is an elected tax status, rather than a business entity. It operates as an LLC in that the liability risks remain separate from the practitioner. However, an S-corp is less structurally flexible than an LLC.


There are many different types of insurance policies from which a private practitioner can choose. The right type of insurance coverage depends on each individual business, as insurance needs vary. However, basic insurance should cover the practice, business, and the practicing therapists.

Popular types of coverage include:

  • Personal Income Protection: Protects from unforeseen circumstances like an injury or illness that prevents business operations.
  • Business Protection: Protects the business owner from accidents on property and issues involving the business property.
  • Professional Protection: Protects the practice from malpractice suits, etc.


The complexity of a small business and tax considerations often warrants the consultation of an accountant. However, the basics of what a business owner should take into consideration from a tax perspective include:

  • Separation of personal assets from business assets
  • Having a proper accounting software program (like QuickBooks) to keep track of assets and liabilities
  • Organized method for keeping receipts and other financial paperwork
  • Quarterly self-employment taxes

As you walk through the setup and considerations listed above, it will become clear if starting a private practice is the correct next step in your career. This list is not exhaustive but can help to paint a picture of practicality. 

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