I am a mental health therapist living and working in Alberta Canada. I work as a mental health therapist through our public health system here 4 days a week, and run a small private practice through my own company on the side. My private practice is booming, I have a great caseload and a waitlist of clients who want to work with me due to my specialization. I am trying to decide if I should quit my public health employee job and just work for myself full time.
Here are some of the facts I am considering:
I am married with a 7 year old child. My partner makes about $2400 a month at a warehouse job. He does not have a pension through his job.
I have fibromyalgia.
It’s a pretty mild case, but it has gotten worse as things at my healthcare job have gotten more stressful
Driving to my current public health job causes me a lot of pain.
Working private practice means I will get to mostly work from home (seeing clients virtually) or walk down the street to an office space I sublet (very affordable, $20 an hour)
I feel a lot better when I can work from home, I can stretch and use heating pads more, cuddle cats, go for a nice walk at lunch and sit near a sunny window.
However, this condition could worsen as I get older (I’m 33) and I sometimes worry I will need to go on short term disability.
Also however the research on fibro says staying as active as I can helps, and luckily my job doesn’t require any manual labor.
My current healthcare job pays my about $3500 a month after taxes, pension payments ($300), parking ($150), healthcare contributions, and EI and CPP contributions.
Through my pension calculator, if I stay at this job I can retire at 60 and get a pension payment of about $3000 a month.
I am lucky to get a small raise every year. The maximum I can earn in my position is $77,000 gross income.
This job is stable, I am not likely to get laid off
I get paid the same even if clients don’t show or cancel.
I like the work, I am mostly pretty autonomous
However, the job is higher pressure than working privately. I see people who are really unwell, often suicidal, and who need very intensive supports.
I do have to show up at work at 8am which means I have to rush my son out the door for 7:20, pay for before care at school.
I am not able to work from home when I need to (which really helps my physical health when I have a flare up).
My private practice has been open for 7 months and in that time I earned a gross income of $14000. This was from seeing about 2-5 clients a week.
I have calculated if I work 4 days a week seeing 15 clients a week and charging $190 a session (the going rate for therapy where I live), and I give myself 6 weeks of paid vacation a year I can make a gross income of $131,000.
If I save 30% for taxes ($40,000), and have about $1000 monthly expenses (space rental, website fee, I have very little running costs) I should take home $79,000 a year, or about $6500 a month.
I have the option to expand, take on a less experienced therapist who fits my specialization, offer them supervision and marketing and a caseload for a cut of their fee. I wouldn’t want to do this unless it was the right person, and I would want a fair deal which I believe is about 30% of their rate. This could land me some mostly passive income.
I leave my private therapy sessions often with MORE energy than when I started them because I find the work truly fulfilling and I feel fairly compensated for my work.
If clients cancel or no show I charge their credit card and still receive some payment, usually around $100 a session. I do not tend to get a lot of no shows and have a software the automatically reminds clients of sessions.
If I were to work for myself I would of course invest in retirement savings (I would welcome any advice on how best to invest), I’m thinking at least $500 a month.
What would you do if you were me and had these options?