The previous post was three big myths counselors and therapists run into when taking steps to make their private practice become a reality. Here are a couple more. Let me know if you have heard of any other myths by commenting.

Myth 4: A salary is the only way I can pay my bills.

The same amount of money at the same exact time every month is the norm many strive to attain. Personally, I would feel like a hamster getting a treat for going round and round on my wheel. The longer we work, the harder we work, and the more we truly love what we are doing, the easier it is to understand we are worth more than $40,000 a year. Yes, that is the median according to salary.com. Working for yourself, you will be paid by the service you provide. This means you must have both the confidence that you are worth $100 to $150 per session and the determination to expand beyond just counseling. I follow Dave Ramsey’s irregular income model to manage my finances. A great rule of thumb is to pay yourself only what your company profited in the previous month. For example, imagine making $5000 total last month, that means this month your available net income supposing %50 profit, would be $2500. This may sound similar to that $40K…except that it grows! Each month fluctuates and many clinicians have successful six figure businesses.

Myth 5: I would have to take out loans and when I fail, my situation will be worse.

This myth is best debunked with the famous adage “the borrower is slave to the lender.” Do not EVER borrow money because you cannot predict the future and you can damage your personal and business finances. Borrowing is a dangerous rabbit that will lead you down the rabbit hole which as Alice knows, is a tumultuous and scary place despite being riddled with colorful creatures. Then how does one get started?! The first step can be different for everyone. If you have an office space in mind, then while you are still employed save up three to six months of business expenses and open a business account. Business accounts at many financial locations are available for free, but they often want an EIN. You can obtain this for free from the IRS. It is important not to get stuck using your social security number in order to keep your personal one hundred percent separate from your personal life. One way that I think about it is that money saved for investing in my business and revenue earned does not belong to me, that money belongs to the company I own and must run as if someone else entrusted their assets be managed by the ethical and organized individual I am. Maybe you decided an office is too expensive until you have a few clients. In this case, finding clients is your first step and you will want to jump head first into marketing and networking. This is why transparency is extremely important. Never hide your intentions with your current employer and make it clear you will be working on development of your own practice.

If you are serious about making the transition to private practice and want a consultation, shoot me an email at katrinadragon@yahoo.com. If you already have a successful practice, comment with your tips for clinicians just beginning their journey of self employment.