Full disclosure: I didn’t plan a THING when I started my practice. And, it worked out OKAY. But, it cost me money, gave me lots of headaches, and wasted my time. It created messes where messes did not need to be.
It’s okay. I forgive myself for the stuff I didn’t know and for the pressure I felt to just hurry up and build some sort of business. I had less than 20$ in my bank account. There wasn’t time to plan.
In part, that is why I am here writing this blog post today. One of the things that made the biggest difference for me was having free resources to look at when I was trying to figure things out. They helped me a lot. I want to help you, too.
I hope that by sharing this information, I can save you some headaches and help you improve your planning process.
5 things you REALLY need to think through when starting your private practice:
- Your office does not need to be big, fancy, or beautiful. It does need to be in the right location, though. Don’t choose a location that you don’t want to commit to for the long run. Wherever you set up shop will be where your referrals are and if you make a BIG move (to another city, town, etc) it might be like starting over again. You can, of course, move to a new office space. But, it’s harder to move to a different zip code.
- What do you want in 5, 10, 15 years for your practice? Choose a name that will grow in that direction. Consider the implications of the name.
- Sole prop or LLC
- Which business structure do you want? If you start as a sole prop and later change to an LLC you will have to switch EIN numbers (the number the IRS needs from you). Switching an EIN number has a lot of implications and can make things a bit messy. You will also need to get a new bank account and pay attention to how your recording your finances differently.
- Insurance based or private pay
- This is a big one! I have seen a lot of therapists jump onto insurance panels when they feel some anxiety and then regret it later. It is easier to get on panels than it is to get off of panels. Take time deciding what will truly be the best form of payment for you. Research how much your insurance companies pay and whether or not it will be sustainable for you to file the claims, etc.
- TAXES!!! You will have to pay taxes. Save your money. Get an accountant.
I don’t want to overwhelm you, so I will leave you with these five areas to consider. Take time to sit down with yourself and write out your options. Weigh the pros and cons. Talk to other therapists about their experiences. Call the insurance companies to get more information.
Want more support planning your practice? I currently have 1 spot open in my MBA for Therapists Masterclass this summer. You can click here to join. Spot taken? E-mail me to join the waiting list in case someone drops out.
Elizabeth Earnshaw, LMFT is a private practice owner and consultant for therapists in business. To read more click here.