We’ve talked about how to start a private practice as well as why you should consider private practice, but how much is it going to cost? Starting a counseling private practice doesn’t have to be expensive! There are a few things you absolutely must have to get started. In this article, we will discuss the costs of starting a counseling private practice and what is necessary for success. We’ll also touch on some of the nice-to-haves that can help you succeed even further. So whether you’re just starting or you’re looking for ways to improve your current private practice, this article is for you!
I’d say it’ll cost you a minimum of about $500 to get started in private practice. A fairer estimate would be closer to $1000-1500 depending on what you already have and where you’ll be practicing. The costs of starting a private practice can quickly balloon out of control if you’re not careful. Let’s see what you need, shall we?
The Two Things Every Therapist Needs to Start a Private Practice
There is no way around it. I believe that every therapist needs to establish a business entity and have liability insurance. The latter should be a no-brainer at this point, but establishing a PLLC is just as important when it comes to protecting yourself and your business.
Establishing a PLLC with the State- $300
Technically, you could file a DBA (Doing Business As) with the county in which you are practicing. This will only cost you a few bucks, but it doesn’t offer the same level of protection as a limited liability corporation. The latter will protect your personal assets in the event you are sued. I highly recommend it. It’s a non-negotiable for my LPC Associates.
To create a PLLC (professional limited liability corporation) in Texas, you’ll need to file the paperwork with the Secretary of State and pay a $300 fee. This can be accomplished through the SoS website here: https://www.sos.texas.gov/corp/sosda/index.shtml
Before you log in for the first time, you’ll need to request an account. This can take as short as a few hours, or a few days depending on how quickly they get back to you. One of my associates had to call them to get it sorted out, but it was a quick and easy process nonetheless.
Once you have your login information, you’ll be able to file the necessary paperwork to establish your PLLC. The process is pretty self-explanatory but can be intimidating the first time. I may do a complete walkthrough of the process, so let me know if you’d like me to write one up.
Get Liability Insurance- $100-500
Getting liability insurance for your counseling private practice is a must. This will protect you if a client files a lawsuit against you. While it’s unlikely that this will happen, it’s always better to be safe than sorry.
I use CPH & Associates for both my professional liability and general liability coverage. It costs me about $450 per year. The reason you want general liability insurance, sometimes referred to as slip-and-fall coverage, is it will cover you if someone is injured in the waiting room or a painting falls on their head. (Luckily, the painting in my office fell when no one else was there.)
Some therapists I know are covered through HPSO. There are a few different options when it comes to insurance, so be sure to shop around and find the one that best suits your needs.
If you work at an agency or group practice, you may already have some liability insurance. Once you’ve established your business, you’ll want to go to the insurance agency’s website and ensure your new practice is covered as well.
Now for the Nice-to-Haves
In the age of online therapy, you only need a computer and a quiet, private place to see clients. The rest of this list is for things you may or may not need to get started but things that I highly recommend. The more you have in place now, the easier it will be once your practice is growing.
Computer and Webcam- $200-500
Obviously, you need a computer and a webcam to see clients virtually. If you’re strictly in person, you just need a way to document sessions and respond to emails. You may already have a suitable device for this. If you don’t, you can get a Chromebook or tablet for a few hundred bucks to get started.
You can always upgrade to something nicer later on. Personally, I use a MacBook Pro for my practice, and this doubles as the computer I use for my side gig of creating therapy websites (and occasionally playing games between sessions).
The best computer and webcams in the world are useless without reliable internet. A wired connection is preferable for stability, but I often use the wifi in my office without issue.
If you’re using a home office, you may already be paying for internet. You may consider checking with your accountant to see about providing yourself with a stipend for your internet bill if that’s the case. This could count as a business expense and be deducted from your taxes.
A Place to Practice- Varies greatly: $0-1200/mo
The reason this one is under the nice-to-haves is that many therapists use a home office to conduct teletherapy. I envy those who can. Luckily, my office is only a 4-5 minute drive from home.
An office is essential for me not only because I have a hybrid practice but because I also have a home with 4 children under 10. Even during the day, there are still two little ones running amok.
If you are just starting your practice, there are some low-cost options for office space. You can ask other therapists in your area if you can sublet their space when they aren’t using it. I did this when I first started. I rented an office and saw clients just on Mondays.
After that, I partnered with another therapist and paid her for every hour I used the office during the month. We shared a Google calendar, so I knew when the office was available. Once I was seeing more clients, it became more affordable for me to seek my own space since I was paying her $20/hr.
Aside from therapists, you can also contact other providers in your area including chiropractors, massage therapists, or physical therapists. Heck, I’ve known counselors who utilized the office space of doctors and dentists when they got started.
Remember to stick to the basics when you’re just starting your private practice. If you’re working online, a chair and a desk are all you really need. You may want a lamp or selfie light so that your clients can see you more clearly, but that’ll only run you about $20.
If you plan to see clients in person, a good couch and a few end tables for lamps and tissue boxes work well. I got a set from a local furniture store about four years ago now, and they’re holding up well. Cost me about $800 for the chair, couch, and two end tables.
If you’re up for some bargain hunting, you can save quite a bit when furnishing your office as well. I know a therapist who found most of her office furniture on Facebook Marketplace. I was able to snag this amazing wooden desk for my office for $0. (I just had to get it out of my in-laws’ garage.)
Okay, maybe infinity is a bit of an exaggeration, but there is no limit to how much you can spend (or waste) on advertising for your private practice. Laura Long, whom I consider a mentor and friend, introduced me to the term crapshoot marketing, and it’s exactly what most therapists engage in when they are trying to bring in clients.
Their marketing isn’t strategic, and they’re just throwing stuff against the wall to see what sticks. The problem, in my experience, is that they are marketing backward. They haven’t figured out who their ideal client is and are just trying to reach anyone who will listen.
They send cold emails, go to networking events, hand out business cards to anyone who will take them, and rely on PsychologyToday to send them referrals. Don’t get me wrong; there is nothing wrong with these things in and of themselves. But without a clear marketing message, you’re just walking down the street with a megaphone hoping someone will listen.
So before you spend a dime on marketing, get clear about whom you are marketing for. Once you’ve clarified that, you’ll know where to go and how to reach them. You’ll stand head-and-shoulders above other therapists with their bullhorns. After all, great therapists don’t compete; they stand out.
So what’s your marketing budget for your newborn private practice? As little as $0. I always recommend new practice owners reach out to everyone they know and let them know they’re taking clients. Not just any clients, though. Your ideal clients.
When you’re the ideal therapist for X clients, everyone who has heard your message knows exactly where to send X clients. That’s great marketing.
EHR and Clinical Forms- $29-99/mo
This one’s a two-for because many EHRs have standard forms included. I know Simple Practice does. While I did purchase intake forms from Private Practice Startup, it’s not necessary in the beginning. If you’re an LPC Associate who works with me, I provide all the necessary clinical forms for free as part of your supervision. Depending on which professional organization(s) you’re a member of, you may also be able to get some starter docs such as informed consent and HIPAA notice for free.
When it comes to selecting an EHR, there are many different options available. I do highly recommend starting with an EHR as activities such as note-taking and scheduling are so much easier. If you’ve read some of my previous posts, you know I’m a huge fan of having systems to streamline your practice. An EHR is pivotal in that.
That being said, it still falls under the nice-to-have list as you can technically use the traditional pen-and-paper method of notetaking. I don’t recommend it, but it’s an option.
A Website- #bloodsweatandtears- $6000+
I have saved the best for last- a website. You need a website. You need a great website. You need a website that is going to bring clients into your practice while you sleep! Your website is one of the best investments you can make in your practice. Period.
I believe a website is essential to a thriving private practice. Why is it under the nice-to-haves, you ask? Because technically, it’s not 100% necessary, and it’s something that you will likely work on for some time after you’ve started your practice. The sooner you start, the sooner you’ll start getting an amazing return on your investment.
How much is a client-attracting website going to cost? Well, are you a website designer, copywriter, and web developer? If so, you could probably do it yourself for the cost of a domain name and hosting (which is as low as $100/year).
If you’re like most therapists (or most people for that matter) and don’t have those skills, then it will likely cost you a bit more. You could hire a professional website designer for a couple of grand to have a really pretty website, but they won’t write the copy (the words on the pages). You can then hire a professional copywriter for another thousand or so to have a client-attracting message on those pretty pages of yours.
Then you have to worry about the backend of your website. Pretty pages and pretty words don’t matter if it takes forever to load or if your website isn’t secure. For that, you need a web developer. Toss a few hundred to a few thousand his/her way as well.
Now those pretty words and pages load quickly, and clients have a way of reaching out to you… if they can find you. You might just need some help with the SEO of your website. After all, pretty words and pretty pages can’t help you if no one can find them. Hire an SEO for a few hundred (or more) per month for a few months, and you’ll be good to go.
Oh, and websites require maintenance to keep all the elements up-to-date and free from hackers and malware. Don’t want your site being taken over by hackers and used in some insidious way. Most maintenance companies will charge you about a hundred or more per month to keep things running smoothly and reboot your website if it encounters any errors.
You can see how the costs of a great website can add up quickly. Luckily I just so happen to know a guy who is also a therapist and builds websites for therapists for a low monthly fee of $99. That guy is me by the way, just in case you hadn’t caught on yet.
I do all of the above- website design, copywriting, web development, and maintenance for just $99 per month. No setup fees. No additional costs (unless you want a super-expensive domain name, then you’ll have to purchase that yourself).
I don’t want this post to turn into a sales pitch, and you can build a decent site on your own. Just don’t use a free builder like Wix, and stay away from GoDaddy. I use WordPress for all my websites, but many therapists have had great success with Squarespace, and their builder is pretty darn user-friendly.
Just like I mentioned with marketing, though, don’t start building a website until you get clear about your ideal client. That’s the best way to avoid wasting time and money on your website.
Can You Start a Private Practice for Less Than $1,000?
Yes. If you file a DBA instead of a PLLC, already have liability insurance, work from home instead of renting an office space, already have a computer and webcam as well as reliable internet, you can actually start your private practice for less than $100.
A more reasonable guess as to how much you’ll need (minimally) to spend to start your practice is about $1000. The PLLC will cost you $300. About the same for liability insurance. Throw in recurring costs like an EHR, internet, and a website, and you’ll hit about $1,000 the first month with recurring costs of about $300 per month after that. Add in another $400 per month for supervision if you’re an LPC Associate.
Of course, the low-cost option isn’t for everyone. If you want to see clients in your office space right away, then you’ll need to factor in the cost of renting an office space as well as purchasing (or leasing) furniture. You might also want to consider joining a professional organization or two which will have annual membership dues.
So there you go. You can start your own counseling private practice for less than $1000, but it might be more comfortable for you to have a bit of a cushion and start with $2000 or $3000. Either way, starting your own practice is an investment, but one that can pay off handsomely. How handsomely? Check out my post about How Much LPC Associates Make in Texas which talks about what you can make in private practice.
About the Author
Mark Cagle is an LPC Supervisor in Texas and provides online supervision to LPC Associates throughout the state. He also has a thriving private practice in Dallas focused on working with couples in crisis.
Being the nerd that he is, he also builds websites and creates digital marketing plans to help other therapists flourish in their practices.
There are many great reasons to work with Mark, but don't just take his word for it. If you want to skip the usual associate slog and jumpstart your career in private practice, schedule a chat.