How to Leave Your Full-time Job for Private Practice

private practiceIt’s hit you that it is time to leave your full-time job. Or maybe, you know over the long-haul that you want to leave eventually. Either way, the full-time job isn’t for you.

So, how do you leave your full-time job? That’s the easy part: Put in your notice.

But wait! Let’s have a plan to mitigate risk and increase your income over time.

First, let me tell you my story.

How I Planned (and Achieved) Leaving my Full-Time Job

Initially, I never thought I’d leave my full-time job. It actually was one of the better paying counselor jobs in my midwest city. It had great benefits. I liked my supervisor and staff I worked with. I was able to be creative. We didn’t bill insurance. What’s not to like?

It took a while, but I eventually realized that every day that I showed up, I was actually losing money. It did not happen overnight, but the counseling private practice and private practice consulting business that I had created on the side was making far more than the full-time job. (Here are my monthly income reports.)

Every day that I went to my full-time job, I was losing money!

Let’s rewind and see what I did to create a landscape for growth.

Step 1: Reduce Home and Life Expenses

In 2004, I got married. I moved to rustic Upper Peninsula of northern Michigan, where eagles fly, snowmobiles go wild, and people end most sentences with “eh?” even if it is not a question. I made just under $30,000 that year. We paid off $10,000 in student loan debt and paid for my wife’s state schooling out of pocket.

In retrospect, it was one of the best decisions we made. We lived off of $100/month for food, our “entertainment” budget was $80/month (that included going out to eat, movies, and everything that was fun). We each got $50/month to do whatever we wanted. Since we always fought about buying clothes, we called it our “fashion budget,” but it was actually for anything we just wanted to buy.

Also, we saved a little bit for an emergency. I think it was $1,000.

By doing this we:

  • Learned to live on way less than we make. Therefore, if we ever need to go back, it’s not too big of a lifestyle jump.
  • Reduced student loans, paid off all debt (around $40,000), and paid cash for my wife’s graduate school. We were debt-free except the house by 2010.
  • We set ourselves up to save like crazy.

If we look at this as a “how to leave my job” plan, here are the key steps:

  1. Save up an emergency fund of around $1,000
  2. Pay off debt
  3. Save some money

Then, get the business going or growing!

Step 2: Start Your Counseling Private Practice

Maybe you’re brand new. (If so, then definitely check out this article: How to start a private practice).

If you already have a counseling private practice, then grow the overall income by doing some or all of the following:

  • Raise your rates
  • Get off insurance panels so you have more freedom
  • Find a clear niche in private practice
  • Market yourself on radio, newspaper, or TV. (Here’s a great podcast interview all about how to get the media’s attention.)

By building yourself beyond just a list of accepted insurance providers, you build your influence and income. Examples of how to do this are: be seen in the media as an expert, be recommended by trusted people in your area, or do speaking engagement around a specialty you know AND love!

Step 3: Examine the Financial Viability of Leaving Your Full-Time Job

There is a moment when you realize that leaving your full-time job might be a reality. It starts to grow and brew within you. Then you start running the numbers and it may or may not work out. It’s a combination of your own tolerance for financial fluctuation, responsibilities, and demeanor.

Let’s take an example. I was working 40 hours per week and taking home around $1,300 every other week.

1. Evaluate the Final Take Home Pay

Thus, I’d need to take home at least $33,800. For most people, depending on their tax bracket and state, you’ll want to divide this number by .6 to get the amount of actual money that would be needed, pre-tax. That would be: $33,800 x .6 = $56,333.33.

2. Add the Benefits

Most full-time jobs provide some benefits. Here are some questions to compare apples to apples:

  • How much would comparable health insurance cost?
  • How much would comparable life/disability insurance cost?
  • How many paid sick and vacation days do you get?
  • What retirement is covered?
  • What technology is provided for the job?
  • What other options are given as benefits?

In my situation, based on working 48 weeks per year, here’s how the numbers looked (remember, I was planning to leave my full-time job, being the only income for a family with 2 kids):

Health Insurance: $20,000/year

Life/Disability Insurance: $2,000

Retirement: N/A. Since it is a pension and based on the government’s follow-through, it’s very hard to calculate what will be there when I retire. If I stayed until vested it looked like I would get around $300/month upon retirement, despite paying $167 per paycheck into it.

Dental: $1,500


3. Determine What Benefits Were you Already Paying For

I looked at one of my final paychecks and I paid:

Health Insurance + HSA Contribution: $3,536 + $1,500 into HSA = $5,036

Life/Disability Insurance: $312

Retirement: $4,342 (but this went toward a pension that I don’t get)

Dental: $988


4. Subtract What You Were Paying From the Replacement

So now take the cost of the benefits and subtract what you paid out of your paycheck:

$23,500 – $10,678 = $12,822 to replace current benefits

Now let’s add that to the take home pay number: $56,333.33 + $12,822 = $69,155.33 to replace the full-time job

5. Determine the Weekly Income Needed

Lastly, we just have to subtract that number by the number of weeks worked to determine the weekly average needed to replace the full-time income and benefits.

$69,155.33 divided by 48 weeks = $1,440.74 per week

Imagine your session rates are $120 per session, divide that by this weekly income. That would be 12 sessions per week.

We’re not done yet, because you can’t run a business for free! There are other costs that we need to add in, so don’t leave your job yet!

 Step 4: Add Expenses to the Plan

The final step is to examine expenses like rent, running the practice, marketing, and website. Take some time to determine exactly what you need to keep your practice running and growing. These numbers will be variable based on where you live and other factors.

My final word of advice is that this should be a positive move, it should be a blessing and not a curse. Take your time to watch the numbers so you don’t jump too quickly or leave money on the table.

Image courtesy of Chaiwat at

How to Leave Your Full-time Job for Private Practice

Joseph R. Sanok, MA, LLP, LPC, NCC

Joseph Sanok

Joseph R. Sanok, MA, LLP, LPC, NCC teaches consultants how to become better consultants through his website Joe also helps counselors with growing private practices through his website He also loves sailing and playing with his two daughters.


APA Reference
Sanok, J. (2015). How to Leave Your Full-time Job for Private Practice. Psych Central. Retrieved on October 22, 2020, from