By Wendy Salazar, MFT

Therapist works alone in her home office

Many therapists have dreams of one day starting their own private practice. Following through on these aspirations, however, requires taking a number of things into consideration.

There are definite pros and cons. Having worked as a therapist for a number of community organizations prior to having my own private practice, I can attest to the validity of both. Some of the issues to consider include:

Business Concerns

Starting a private practice requires exploring the laws in your city that apply to owning your own business. You will typically need to obtain a business license from the city you live in and renew it on a yearly basis.

Work Schedule

Owning your own business means having the freedom to limit the number of days and hours worked. However, you also need to be able to accommodate people when they are available to come in, which may require having to work evenings and/or weekends.


Being in private practice requires taking the steps necessary to generate business, which many therapists feel uncomfortable doing. Establishing a web presence is important in order to attract individuals looking for the specific services you offer, the therapeutic approaches you use, and any areas of expertise you may have. Effective ways of advertising include creating a practice website, writing a blog, and maintaining one or more professional profiles on online therapist directories such as GoodTherapy. All of these efforts take time and some financial investment.

Insurance Panels

Working with insurance companies can provide an ongoing stream of referrals and new business. Many individuals will contact only therapists who accept their insurance. In addition, many insurance companies will transfer payments electronically into the therapist’s bank account upon request, which can be quicker and easier than receiving checks in the mail and having to make trips to the bank.

On the other hand, it can be a lengthy and difficult process becoming a provider for many of the insurance panels out there. The applications are often long and time-consuming to fill out, and they can take anywhere from three to four months to be processed. In some parts of the country, a number of insurance panels may already be saturated, making it difficult to join and limiting the number of individuals you are able to see. Reimbursement rates are also often quite a bit lower than many therapists’ typical rates, and it can often take up to 30 days to get reimbursed. If claims are not submitted in a timely manner and/or there are problems with the claims, this can also slow down the reimbursement process or even prevent the therapist from getting paid. Calling insurance companies to check on claims can also be tedious, as their call lines tend to be busy.


Going into private practice requires taking into consideration the overhead and other expenses that apply when one owns a business. Some of the expenses to account for include the need to lease office space; the cost of utilities; furnishing the space; marketing efforts; obtaining office supplies and business cards; and the price of medical, dental, and liability insurance. You will also need to decide whether to do your billing yourself, which can be time-consuming, or hire someone to do it for you. If you are just starting out, you may want to consider subletting an office on a part-time basis (for example, on weekends and/or one or two evenings a week) to start building your practice before quitting your full-time job.

Fluctuating Income

Although a private practice can be profitable, it can also be unpredictable at times. Whereas you are typically guaranteed a certain monthly income when working for an agency or organization, a private practice does not provide the same level of security. The number of individuals seen, as well as the income generated, tends to vary from month to month. It can also take time to build up sufficient business for you to live off of, and you have to set aside money for taxes and/or make quarterly estimated tax payments, as this will not be done for you. You also need to keep in mind you will not get paid for any time off, so you will need to have a cushion set aside in order to account for any vacation or sick time.

Going into private practice can be profitable and rewarding, but it can take a lot of time and energy before you get to that point. The risks associated with any type of business are not for everyone, but the dream of starting your own private practice can become a reality if you are willing to take a leap of faith and put in the work needed in order to succeed.