8 Mistakes I Made Building a Private Practice

We’re bringing back this top article because it’s been one that so many have seen, and we want to be sure you see as well, especially if you’re considering joining Business School for Therapists in the future.

What Not to Do in Private Practice

The path to building a private practice is rarely perfect. While most of you know I was able to build a successful private-pay private practice during the recession, many of you don't know all the ways I messed up. The truth is, I tend to look back on things in a glass half-full. Every mistake I made led me to a million great decisions and experiences. But, it still doesn't mean it was without lessons learned. That’s why I want to share the mistakes I made.

Mistake #1: I Didn't Make a Business Plan

The truth is, I didn't know how to make a business plan. I did enroll in Casey Truffo's membership plan, and she taught me roughly how to develop a fee. However, my numbers at that time weren't built on anything. I had no idea about taxes, expenses, or continuing education, and didn't even remotely consider retirement. In some ways, ignorance was bliss. It helped reduce my anxiety that “I didn't know everything I didn't know." At the same time, I started at a disadvantage, not completely prepared for being a business owner.

Mistake #2: I Wasn't Confident with my Fee

I set a decent fee... which I immediately discounted. I don't mean I did a sliding scale; I mean I completely discounted the fee as long as someone paid me at the time of the session. It was a $25 "discount" for paying at the time of the session, if I recall correctly, which was really more like a $25 fee for paying late. It wasn't straightforward, and it felt a little gimmicky and desperate. Much like my age (I looked young when I started therapy), when I got confident in my fee, others became confident in my fee. I also didn't fully explore the legal and ethical issues of setting a "discounted" fee in this manner.

Mistake #3: I Didn't Research What Was Available in my Area

I didn't know what the term "market research" meant when I started my private practice. That led to several bad — or at least odd — decisions. The truth is, there weren't many therapists advertising when I started my private practice. VERY few therapists in my area had websites. I was taking advice on marketing from therapists who were in very saturated markets with lots of other therapists. While the advice wasn't bad, it didn't completely fit my situation. I learned I had more options for building a practice in an area with less competition.

Mistake #4: I Didn't Plan for Getting Full

There’s nothing more exhausting than finishing a FULL day of clients and realizing you have 3 phone messages from clients who need therapy. I always strove to return calls quickly and take time with each person to give them referrals that were the most appropriate, but that takes a fair amount of time. When I identified my schedule and number of clients, I didn't plan for returning phone calls because I was getting too many referrals, expanding to add new clinicians, etc.

Mistake #5: I Didn't Have an Exit Strategy

I had always planned to live in Modesto, CA. Even when there were potential moves for my family, I focused more on where I would get new income than how I would transition the private practice. My private practice website and branding were all location-specific, which is AWESOME, but it definitely didn't help me when I moved to Seattle, WA, and then down to Oceanside, CA.

Now, I find myself settled down in SoCal, and I had trouble letting go of the practice and starting over at first. But eventually, I made more room for life here and transitioned into fully working on zynnyme and my coaching business. Had I thought through an exit strategy I could have sold the business or transitioned it in a way that allowed for other kinds of growth.

Mistake #6: I Didn't Have a Plan for Bookkeeping

As January passed after I started my private practice, I started to panic. I had done several things right, I had kept all my receipts, I had opened a separate bank account and put all my expenses through there, but I had NO idea what a profit and loss statement was. I had no idea about quarterly taxes, and I was completely lost as to how to file taxes that first year. So, I did what any self-respecting therapist does: I stuck my head in the sand until late March!

I was lucky to connect with a bookkeeper who was SO incredibly kind to make sense of my envelope of receipts and bank statements. From then on out, my bookkeeping got outsourced — it made life SO much easier. She would send me an email every few months asking a few questions about how to categorize a particular expense, and I would get all the reports I needed. I’ve gone through different phases of doing my own books using Outright as well, but as the business has grown, I now use QuickBooks with a new bookkeeper (yep, Kelly’s husband).

Mistake #7: I Didn't Plan for Taxes

Well, I sort of planned for taxes. Initially, I really wasn't sure how to make sense of everything. We had two incomes, and that first year my income went down dramatically since I didn't work for part of the year, and it took a few months to get things flowing. I was pretty shell-shocked when I saw how much I owed in taxes! It took a few years before I felt like I had things "locked in" and knew how much to sock away for tax purposes exactly.

Mistake #8: I Let Others’ Opinions Impact Me

I would love to tell you that I’m completely confident and never let others’ thoughts and opinions get to me, but it just isn't true. Throughout my private practice career, I’ve found myself justifying my decisions and even keeping certain things quiet for fear of how others would react. Whether it was offering "faith-based counseling" and being open about being a Christian, charging people from business consultation, or making the decision to stop seeing clients when I moved to Seattle, WA I’ve felt deeply many of the statements made online or in-person that were pointed directly, or even generally, at me.

In fact, I have about three half-written blogs with my in-depth, ethically sound justification for not getting licensed in Washington during my 18 months there or not seeing clients virtually. I’ve even been known to completely avoid Facebook groups where I know I could add to the conversation because of how stressful it can be to stumble upon someone saying something funky about me. I’m a work-in-progress, and as someone in the "public-ish" eye, I have to stand in my truth. It’s a work in progress!

Here’s the truth: You don't have to be perfect to be successful. And even with the best planning, you’ll make a few mistakes or missteps. You could completely emulate what someone else has done and find it isn't quite right for you. Do your research and avoid as many mistakes as you can. But, when you do get pointed in the wrong direction, take a breath, reassess, and realign! 

Have you made a mistake you want others to avoid? Share in the comments below!

Are you looking for more support? Learn more about how Business School for Therapists can help you with the nitty-gritty logistics of running a streamlined, profitable, and client-centered private practice.