How Therapists Can Succeed Financially: Tips for Increasing Your Salary

Lisa Marie Bobby:

So you’re a therapist with 300, 000 in student loan debt and a 50, 000 a year job and you’re thinking, what have I done? Today’s episode is for you. We’re talking about how to succeed financially as a therapist.

Specifically, on today’s show, we’re going to be covering different employment options that you have as a therapist, ways to continue developing yourself professionally, we’ll also be talking about how to make it in private practice, as well as some areas of specialization that you might want to consider if your goal is to be financially comfortable and a therapist.

And I’m so glad you’re here with me today. I’m Dr. Lisa Marie Bobby. Like you, I’m a therapist. I am a psychologist, a marriage and family therapist, a board certified coach, and I’m also the founder of Growing Self Counseling and Coaching. And just like you, I came out of school I and had the student loan debt and thought, Oh, what have I done?

And started thinking about how am I going to make this work? And so the information that I’m offering you today is going to be based on many years of personal experience,

but I’ll also tell you as the founder of Growing Self, I have had the great privilege of working with so many different clinicians over the years through my practice and just, you know, having connections with a lot of other people and have been in a position to see what is really working for clinicians when it comes to financial prosperity in this business and what doesn’t.

And that’s what I’ll be sharing with you today.

So to dive right in, let’s first talk about some of the different areas that you might consider as a therapist in terms of employment, because the reality is that there are lots of different places where you can become employed as a therapist, but they’re not all the same when it comes to the paycheck.

For example, did you know the best paying therapist jobs? Of course, there are the MDs, psychiatrists are doing very well for themselves, and they’ve done a lot to go through medical school. It’s a lot, but it is a great specialization. You may also consider, if you are a psychologist or other therapist, in many states now these days there are educational programs that will allow you to have prescription writing privileges.

And that could be something to consider if, yeah, you don’t maybe want to go to medical school but still want to get in on that game.

There are also things like industrial slash organizational psychologists, and these are professionals who are applying the things that we know how to do to workplace environments specifically with a goal of improving things like productivity, employee satisfaction. They might sometimes have a leadership coaching or team development type role, and they can command really good.

Salaries averaging over 90, 000 a year. So this is another specialization that can be both lucrative and impactful. And depending on what you’re into, it might also be fun.

Other psych friends who are kind of crushing it are the neuropsychologists. Our colleagues who are so. specializing in brain health and understanding how brain functioning influences behavior. So neuropsychologists are often working with patients who have suffered brain injuries or other neurological conditions, and they too are commanding salaries north of of 90k.

And they’re also earning it. You typically need to have a PhD or PsyD in psychology with a focus on neuropsychology to pursue this career path. But it could be something worth doing if you’re trying to get into a situation that is going to be both rewarding and enjoyable, but also will pay off financially for you.

School psychologists aren’t doing too bad either. According to the Bureau of Labor Statistics, the median annual wage for school based psychologists is around 82, 000 a year. So depending on where you live, that could also be something worth exploring.

You might be picking up on a theme here, which is that the highest paid therapist positions are ones that require a fair amount of education to attain. So you might be thinking to yourself, Lisa, stop. I don’t want to go back to school. That’s cool. And that’s valid. I mean, not everybody wants to go through a lot of additional rigorous training required for these roles, but I just wanted to point these out because really, if your goal is to get into an employment situation where you’re going to be well compensated, you need to know about it so that you can weigh your options and even just think about whether or not this kind of commitment could potentially be something worth doing.

And if you’re thinking about going back to school to obtain additional certifications or degrees that can open the door to higher paying opportunities, you want to probably be looking into PhD programs or PsyD programs, especially if you want to pursue one of these career paths that does require specialized education.

But I will also tell you just straight up,

having a doctorate does not necessarily change anything for you financially if you’re really just providing counseling or psychotherapy. And that’s true for private practice. And it’s also true for a lot of agency positions. Every once in a while you will find a doctoral level clinical mental health position that does pay more than a master’s level, but that is not always the case.

. So be sure to research specific roles and employment opportunities and jobs just to make sure that you know how those numbers shake out if you’re thinking about going back to school for a more generalist clinical position because it would be a shame to spend that much more time and energy and money and not have that turn into a difference in your paycheck at the end of the day.

Now, if you are interested in pursuing private practice, or if you are in another clinical mental health position, it might be worth looking into specialized certifications.

And these would be things in niche areas like trauma, substance use disorders. Family therapy. These types of things can really set you apart from other therapists and in that way allow you to charge higher rates for these highly specialized services. That’s why it can make a lot of sense. to get clear about your niche as a therapist.

If you’re a regular listener, you’ve heard me talking about this on past episodes, I would invite you to check out this podcast that I recorded on how to get clear about your niche as a therapist. It’s totally free. You can find it on my website, growingself. com forward slash therapist. Um, and while you’re there, you can also take advantage of a free two part training that I created for you.

It’s two different videos walking you through a bunch of exercises that are really designed to help you create clarity about your long term career path as a therapist with an emphasis on your whole life. So what are your hopes? What are your dreams? How does your career as a therapist fit into that? And then in this training, I designed it for therapists who are interested in, like me, creating a specialty niche as a coach. So I am a therapist, I have all the degrees, but Specialized in coaching and that is what makes my practice different and I am a coaching educator I do a coaching certification program I’m super passionate about coaching and coaching is not for everybody But this free two part training will give you clarity about your career path whether or not you decide you want to pursue coaching But if you are interested It will also teach you more about what coaching is, how it works, how to become a certified coach, and the path so that you’ll have clarity there too.

tO access that free resource, come to growingself. com forward slash coach.

I know going back to school can be a significant investment of time and money, but depending on what your longterm hopes and goals are, the best investment you’re ever gonna make is you. And so by investing in yourself and building up your own.

own professional value. It can really enhance your expertise, but also open more doors to potentially more lucrative positions. Again, depending on where you want to go.

If you’ve been waiting for me to talk about private practice and financial success, we have arrived at that portion of the podcast. So let’s talk about what is going on with private practice and some of the differences between therapists that prosper and the ones who struggle financially.

So private practice is definitely a path that many therapists find rewarding. It can be financially rewarding. It can also be very challenging. And I say this as somebody who’s been in private practice for a long time. Before my practice growing self turned into a group private practice, I was a solo practitioner for years.

And I know that running your own practice can offer the potential for a higher hourly rate, but it is not without its hurdles and it is a ton of work just to be completely honest with you. So you have to be thinking about the effort that goes into a private practice versus the profit because what people pay you per hour is not the same thing as your hourly rate for all the work that you do.

To break this down, the average annual earnings for a therapist in private practice can vary pretty widely and it depends on a bunch of different factors. So location is a big one. Also that all important specialization, sometimes years of experience, but also the types of clients that you are seeking to serve.

serve. However, we can provide some general figures based on data and, and the range, and this is coming from payscale. com, is that the average annual salary for a mental health therapist in private practice is somewhere between 40, 000 a year on the low end to 100, 000 a year on the high end. And there is, again, a lot of factors that go into that.

I mean, how many clients a week you want to see? See, some private practice clinicians, they want to see five clients a week and their partner is the primary breadwinner and that’s just fine. So you know, there can be a lot of different factors happening, but it’s also true that some really successful private practitioners can earn even more than this, especially if they’re in higher demand, urban areas, or if they have a very small specific, uh, clientele who tends to be, um, uh, or, or presenting a kind of issue that they work with.

It tends to command higher prices.

But how to crack into that game for yourself first depends on you having clarity around what it is that you’re called to do and who you want to do it with. So take advantage of the free resources I mentioned around what do I want to specialize in, check out that podcast, and also check out that free resource about how do I get clear about my own professional trajectory, um, because that Specialization piece can be a really important part of private practice success.

Uh, and when you get that dialed in right, you can command higher fees. Also experience does count in private practice. So more experienced therapists who have been in practice for a longer period of time. They have established client bases, reputations, a stronger referral network. Check out that how to get more therapy clients for more on those subjects.

If those are areas that you’re interested in growing into

but if you’re thinking about private practice, it is super important that you’re paying attention to how much is it going to cost me to run this business versus how much am I going to get paid per hour. For example,

you can absolutely have a private practice where you are in network with a bunch of different health insurance companies, and they are the ones paying you for your services, which solves a couple of problems. You don’t have to do any marketing. People just show up and they want to work with you. But the amount that you will make profit from per hour is going to be capped and determined by what the insurance companies want to pay.

There might also be a limit on the number of sessions that you can have with your private practice clients. Additionally, you’re going to be working with a more severe clinical mental health population, which is. Fantastic. If that is your calling, but everybody that you work with is going to have a medically necessary treatment.

They have a diagnosis that requires medically necessary treatment or otherwise health insurance won’t pay for it. But the thing to keep in mind here with this business model is that you will get clients. You will get paid for your work, but there can be a ton of time and energy going into the operational costs of submitting insurance claims, calling insurance companies, chasing them around to try to get paid, uh, disputes.

I mean, there can be so much. stuff where you might be spending multiple hours trying to collect for that one billable session that you had, which is not actually that awesome when it comes to the, how much am I making per hour question.

Additionally, when it comes to a solo private practice, you may be able to command higher rates for your sessions and you don’t have to worry about insurance, but you have a new problem, which is how to connect with clients who are excited about working with you. And that requires marketing, which also can be a substantially.

Uh, expensive investment, either of your time or somebody else’s time, which turns into your money. So when you think about the cost benefit, the profit on these businesses, you have to take all of these different factors into consideration.

So, these are reasons why if, especially if you’re going into private practice, having a specialized niche is incredibly important. And I will just share very transparently, that was one of the reasons that I chose Google. coaching as my professional niche. I have all the, you know, traditional mental health training.

I’m a psychologist. I’m a marriage and family therapist, but I am also a board certified coach. And so that is what makes me and my practice different. I am a therapist who coaches. That’s why people come to me. And coaching has been great because, I mean, therapists hate hearing this. understandably, but I have to say it anyway, you know, coaches who do not have a tenth of our training education experience are often able to command much higher rates than therapists can.

And health insurance doesn’t pay for coaching. So nobody’s going to be like, is my insurance going to pay for this if you’re doing relationship coaching or career coaching because no, insurance doesn’t pay for growth and attainment of goals, it pays for health care. So by pursuing a niche in coaching, that can be a fantastic way of connecting with high functioning clients who are prepared to pay out of pocket and who, you know, would pay higher rates for your coaching services than they would for your therapy services.

If, when I was talking about the real deal when it comes to the private practice experience and the amount of work that is involved in getting that to go, either through a medical type model where you’re relying on insurance companies to pay you and all the work that goes along with that. Yeah. Or if you’re doing a private practice that is a self pay kind of model, there is a ton of marketing work to make that happen.

And you’re thinking, Oh my gosh, neither of those things sound good at all. I just want to do what I want to do. Um, you might consider getting in alignment with a really strong group, private practice that handles all of that stuff. So like, that’s what my group growing self actually does. It is a group private practice and we’re really providing practice management.

services for clinicians in private practice who really just want to show up and do the part that they like doing, which is a therapy part, and have all the rest of it be somebody else’s problem, an SEP. For example, we’re handling all the marketing, social media, websites, site emails, we have a connection coordinator, we handle billing and if anybody does insurance like we’re handling that.

So like we’re taking care of everything for people. People will pay us a practice management fee for doing that for them. But at the end of the day, when you break down the amount of time and money that it would cost to do it all themselves, and also I think a lot of people just don’t want to do all that themselves.

They often wind up coming out ahead in the end.

So I just wanted to mention that as a third path towards financial prosperity in our shared profession. Uh, if you’re interested in private practice, but want to do it without all the other headaches to think about, look for a vibrant, well established group private practice that does the work for you.

You do not want to get affiliated with one who’s expecting you to bring in all your own clients and do all your own marketing and do all your own billing and you get to use the office. on Wednesdays. That is not what you want. You want a private practice that’s going to work for you and they’re out there.

So that’s what to know about private practice success, but I will also share just a couple of other things is that in addition to providing direct services to clients, you might also be able to do other things to Bye bye. Uh, develop other revenue streams. So it might be writing books, articles, presenting, giving workshops, classes, online courses.

But again, make sure that it is tied to your specialty niche and what you ultimately want to do so that whatever you’re doing for a living is in alignment with what brings you joy, what you are good at, and what also feels like is congruent with your mission. You know, the, the, we’re, you are. put here to do something.

You chose a career where you get to help other people who are the people that you want to help. So on that note, let’s take another quick look at, oops, three, two, one. Okay. So on that note, I am going to give you a quick crash course in how to get clear about those pieces. First of all, it starts with you identifying your values, whatever direction you go in.

If you gonna try to get a better paying job or if you want to double down on private practice and make that work. The first thing that you need to get clear on are your values. And what is most important for you? And think about, um, how you want to spend your time and your energy, what you want your evenings and weekends to look like, your work life balance, right?

How you want to balance your career, maybe with your family obligations, and then develop a vision for this. That will help you craft the best path forward. forward. And again, if you access this free training that I was telling you about, so growingself. com forward slash coach, I walk you through all of these exercises where you’ll get clarity on your ideal life experience and how your career as a therapist fits into that.

So for example, if you’re like, I want to be done with work at every day at 4 30 and on Fridays, I want to be done at. I don’t want to think about it again until Monday morning. You probably don’t want to be a solo private practitioner, um, because there’s going to be stuff that you’re going to have to do on the evenings and on the weekends in order to make that work.

Um, If when you go into your, your values around what is most important to me, if you’re thinking security is actually really important to me, financial security, stability, I want a 401k, I want health insurance, that means that you would probably be much happier and more satisfied in an employment role that was a sure thing.

Then you would be in private practice because private practice is going to stress you out. It is not that stable and secure. So these are the different things to be thinking about. And also like how much you want to be working. Do you want to be working 40 to 60 hours a week, getting a private practice started, or do you use, I want to really, you know, 40 hours a week, including lunch breaks.

That kind of puts me at 35 hours a week. And I also want paid vacations. You’re gonna want a job in order to make that happen reliably. And so again, just to be thinking through all of your options and what you want, what’s most important to you in your whole life, and then crafting a vision and making a plan to make that happen.

So again, if you go to growingself. com forward slash coach, I’ll walk you through all kinds of exercises that help you attain that clarity.

But on the other side of work life balance, if you really just want to work ten hours a week, you shouldn’t get a job that has full time expectations. Maybe having a little private practice on the side with, you know, five to ten clients a week. Not that big of a deal. It’s enough for you.

You can keep, uh, involved in the game without it being like a super heavy lift. Maybe you’re partnered with somebody who’s the primary bread earner, breadwinner rather, and like insurance. benefits come from them, that is okay. But the important piece is that this needs to be in alignment with who you are and what is most important for you.

There’s something else that’s really important here around how to succeed financially as a therapist that I often remind my clinical supervisees, but I also have these conversations with my clients who are trying to make decisions about their best career path, and I’ll share this with you too. And that is

there are many different dimensions of value and success and prosperity that may or may not have anything to do with us. Money with dollars and cents. So when you’re thinking about your career path, it’s really important for you not to be over indexing. How much am I going to earn in terms of my paycheck?

But what is this decision going to do for me? How will it benefit me in terms of my whole life?

You and I have both met plenty of people who make a lot of money and their relationships are falling apart. They never see their kids and they hate their jobs. So just be careful about being sure to balance out.

out all of the different things that are important to you as you chart this course forward, because we would both hate for you to get trapped into some well paying position with golden handcuffs cinched on your wrist. But really not be doing well mentally, emotionally, relationally, because especially in our chosen profession, we’re not doing anybody any favors.

If we are getting burnt out, if we are depressed, if we’re traumatized, if we’re not having a good time, like we need, we need to be okay ourselves in order to be good in this profession.

So just keep that in mind, both for your benefit, but also for the benefit of your clients. Three, two, one. So just keep that in mind for the benefit of your clients, but also for the benefit of yourself. Remember, this is love, happiness, and success for therapists. So you are the star of this show.

So lastly, I want to give you a few free resources so that you can keep growing. I mentioned a lot of different things on today’s episode. First of all, let’s connect on LinkedIn. I am sharing all kinds of different stuff. stories, tips, ideas, resources for you there. So if you haven’t yet, come find me. I’m Lisa Marie Bobbie on LinkedIn.

If you have follow up questions for me about this episode, I would love to hear them. If there are questions like, why don’t you talk about this on an upcoming episode, I would love to hear about what’s on your mind. So please connect with me here. Additionally, I mentioned a bunch of other podcasts. As we were hanging out today, you can find all of them at growingself.

com forward slash therapists. You’ll find all of the different episodes, articles, different activities that I’ve created for you. A, um, are you spiraling down towards burnout free quiz you can take if you’re interested in it. And you’ll also find access to that free two part training that I was telling you about to help you get career clarity.

So that is all for today. I hope that this conversation helped you get some clarity around how to succeed financially as a therapist, either through employment, through private practice, or maybe doing something completely different. And also how to craft a path that is in alignment with your values, and that is going to bring you the purest kind of wealth and prosperity, which is your mental and emotional well being, your happiness, your joy, your holistic life experience, and ideally a well paying therapy career.

So, uh, thanks for spending this time with me today, and I’ll be back in touch next week with another episode of Love, Happiness Success for Therapists.