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Startup Costs of Part Time Private Practice | Start Private Practice on a Budget

What's up guys! So you're thinking about starting a psychotherapy private

practice, but how much does it even cost? I know from experience that it can often

feel like, "Well, I guess you're just supposed to get started,

pay the money, and you'll find out later how much it costs you." But it doesn't

have to be that way! In this video I'm going to break down the cost of starting

a part-time psychotherapy private practice and share some tips for how you

can save money if you're on a budget.

Welcome to Private Practice Skills. I'm Dr. Marie Fang, psychologist in

private practice. I post videos offering tools I learned the hard way about

starting and growing private practice so that you don't have to. Thanks to

everyone who voted on Instagram to request this video. If you're not

following me on the 'gram yet, be sure to do so. I have lots of opportunities for

you to give me feedback about what type of content appears in these videos. I

decided to split this video into a three-part series: the startup costs of

part-time private practice, the startup cost of full-time private practice, and

yearly expenses for full-time private practice. Today's video is going to be

focusing on the start-up costs for part-time private practice, because I

recommend that if you're interested in starting private practice that you

really do start part-time, get your toes wet, save a bunch of money, and see if

private practice is right for you before diving in full-time. Keep in mind that

costs vary widely depending on where you live and how frugal you're wanting to be

as you get started. However, if you go through this checklist of items you

should be able to get a pretty clear idea of how much it'll cost you before

you've had to even pay for anything. First, start with your website. You could

technically actually do this for free if you wanted to, but I recommend you go

with an option that's ad-free and allows you to have your own domain name. If you

build your own website, these kinds of sites can range anywhere from 15 to 35

dollars a month, or you can pay a much higher premium and have somebody else

design a website for you. If you're curious about that I go over that in

much more detail in my video about how to build a website.

Number two: unless you're planning on providing exclusively teletherapy

services, you're going to need an office in order to practice. Now if you're just

starting out I do recommend you go part-time. There's two ways you could do

this: one is you could rent per hour and only pay for however many client

sessions you're using an office space, or sublet one day a week to start. So the

way it works per hour is if you have a colleague or someone within your

networks that's willing to share their space with you, that is the cheapest

option and easiest on-ramp. As an example, in my area to rent per hour is about

15 dollars on the hour, but you only pay if you're using the office. Now if you

sublet one day a week then you know that that space is yours for that full day.

And just as an example, to sublet one day a week, per month you end up spending

about $180 and it goes up from there.

Now that varies widely depending on where you live, so I recommend you check

on Craigslist just to get an idea of how much sublets are going in your area. Also

keep in mind that some spaces will still require a security deposit even if

you're just subletting. Number three: liability insurance. Super important! This

will probably be your biggest expense starting out if you're starting

part-time. However, the good news is a lot of insurance companies have incentives

for people who are just starting out and they charge less when you're in your

early career, probably because they assume you're going to see fewer clients.

And then over time they will charge you more. So I've seen rates as low as four

hundred dollars for the year, but you do have to pay all upfront. But just to give

you an idea, I've been in practice for six years and I have some pretty good

coverage and I'm spending about eight hundred dollars a year on my liability

insurance. Number four: city business license. Now this varies widely depending

on what city you live in, but just as an example I've practiced in three

different cities in the Bay Area and the annual fee ranged from ninety dollars up

to two hundred dollars a year depending on which city I was practicing in, so be

sure to check with your local city the laws and policies to see if you need a

business license and how much it's going to cost you. Number five: you're going to need a

file cabinet, or a practice management system, or possibly both depending on how

you do it. Now despite my love of technology, I'm a bit old school after a

few scarring experiences with practice management systems so I do all paper

files for my client charts. If that's true for you, all you need to do is buy a

small portable file box. I used a small one for my first couple

of years when I was just subletting. It needs to be portable so just make sure

it has a handle and then of course make sure make sure make sure there's a way

for you to lock it in order for you to comply with all of the HIPAA laws. I'll

link to the one that I used early on. It was under $20 and I bought a lock from

the dollar store so this doesn't have to break the bank. Now if you go with a

practice management system it's going to cost you a bit more money, but then you

can do all of your charts online. So for example, simple practice their most basic

subscription service is $39 a month and it goes up from there. Just to put this

out there, I am a rather frugal person and in the

last six years that I've been practicing and not using an online management

system, I've saved nearly three thousand dollars

in that monthly fee. Think about it. I'm going to share a few more things that are

optional costs so they're things that you could either get for free or forego

all together. You might decide though to pay for some of these items as well. Of

course you're going to need a way for clients to call you, so you need a phone

line. Now personally I use Google Voice which is totally free and forwards to my

personal smart phone. Now I don't recommend you use your personal number

as your therapy practice number, though I do know some people who do choose to do

that. But you can pay and have your own separate phone line. Now if you want to

be in the 21st century, then you're probably going to want to have an email

account affiliated with your business as well. Now there are a few diehard therapists

out there that still don't have an email address. And if that's you, more

power to you, but I think I would go crazy playing phone tag with all of my

clients. I already have a lot of trouble with that as it is. If you're going to get

an email account, there certainly are free options and

you're free to do that. However, you run up against some

issues with HIPAA compliance if you do that. I use G suite which costs only five

dollars a month and with a little bit of tweaking in the settings you can make

your email HIPAA compliant, which is fantastic. I will need to put a video

about that up sometime so that you can be HIPAA compliant your email. whoo yeah.

I don't know what that what that was. Carrying on! You may also consider whether

you'd like to have business cards. Now these days business cards really aren't

that necessary and honestly I have business cards and when I go to pass

them to someone more often than not they just take a picture of my business card

on their phone and let me keep my business card because they think they're

going to lose it. So if you want to get business cards, the cheapest option for

that is probably vistaprint and if you keep an eye out they frequently have 50%

off promotions and you can probably get a pack of like a hundred for maybe like

8 bucks if you get a good deal with one of their sales. So you might try that.

Start with the smallest box you can find because honestly if you're subletting

you're probably going to be moving in not very long, and how sad would it be to

have like 400 business cards with an address that you haven't been working at

for years. So stick with a small box. The last item you might consider paying for

is being listed in online directories. Now if you do go this route you could do

Psychology Today. They offer a six month free trial so it seems totally worth it

to go ahead and try it and see later - six months down the road - if you'd like to

keep that open and pay for it. But you can skip this step and save yourself

that money of course. I've offered this as all of the costs of private practice

with the assumption that you have access to some type of online device and some

type of internet. So putting all of that together, if you're really frugal like me

and you wanted to start a part-time practice in the city that I live in, you

could get everything started up and running for just over eight hundred

dollars upfront cost, and then a monthly cost of about a hundred and ninety five

dollars each month after that. So just think about it: you could reasonably

probably save that money up and spend it all at once without needing to go into

any debt, and that's super awesome! This is the exact same strategy that I used

when I started private practice in my current city and I recouped all of my

costs within the first two months of starting private practice. I hope you

found this video helpful to give you an idea of the start-up cost of a part-time

private practice. Stay tuned for more videos in this series down the road and

until next time, from one therapist to another,

I wish you well. Recommend that you oh ooh! My cat tried to attack a

squirrel that's on the fence which is outside.

There's a window in between. And my dog...