When Can You Retire As a Therapist?

For most people, retirement is a date circled on a calendar. For therapists, it’s often a little blurrier. Because your work is built on relationships and experience, you can keep practicing long after people in other professions retire. That can be freeing, but it can also make it harder to know when you’re financially and emotionally ready to retire. 

This post walks you through what it looks like to retire as a therapist, how to tell if you’re ready, and practical steps to get there without stress.

What Retirement Really Looks Like For Therapists

Many therapists keep working well into their 60s or 70s. Some see a handful of long-term clients, while others shift into supervision or consulting. In fact, a lot of therapists treat retirement as more of a gentle slope than a cliff. Instead of closing their practice overnight, they gradually reduce hours, stop taking new clients, or move more sessions online. That’s because therapy work can be flexible and personally rewarding, so the usual “stop working on Friday, retire on Monday” model doesn’t always fit.

It helps to think of retirement less as an age and more as a set of conditions. You’re retired when your finances, your health, and your plans all line up so that working becomes optional instead of necessary. Framing it this way makes the decision feel less like a leap and more like a planned transition.

Signs You Might Be Ready To Retire

So how do you know you’re getting close?

There are a few significant indicators:

You’ve run the numbers, and they work

You’ve saved enough to cover your living expenses without counting on a full caseload. You’ve estimated your retirement budget, factored in health insurance and taxes, and feel confident you can live comfortably. If you aren’t sure, that’s a sign to get help crunching the numbers.

Your practice can run without you

Maybe you’ve already reduced your caseload or hired help for administrative tasks. Maybe you’ve got a plan to transition clients to other therapists. Having these pieces in place makes stepping back much smoother.

You’re ready personally

Beyond finances, you’ve thought about what your days will look like when you’re no longer in full-time practice. You have hobbies, interests, or part-time work you’re excited about. You’ve started picturing yourself in that new chapter rather than dreading the loss of your professional identity.

Practical Steps To Plan Ahead

The earlier you start planning, the more flexibility you’ll have.

Here are some concrete steps you can take towards planning for retirement:

10 – 20 Years Before Retirement

Begin saving regularly. If you’re self-employed, set up retirement accounts tailored for small businesses. Pay down any high-interest debt. Start sketching out what kind of lifestyle you want later on.

5- 10 Years Before Retirement

Look at the structure of your practice. Could you delegate more, move to fewer clinical hours, or bring on another therapist? Decide whether you’d like to sell, close, or hand off your practice. Meet with a financial planner who understands the mental health field to model different scenarios.

If you approach retirement as a gradual process, it gives you time to test the waters, see how it feels, and adjust before you fully step away. 

Financial Strategies Worth Considering

Since most private practice therapists don’t have employer pensions, building your own safety net is essential.

Here are some practical tips to build a safety net that works for you: 

• Use individual retirement accounts or small-business retirement plans. 
• Diversify your income streams to reduce your reliance on client sessions. 
• Plan for health care costs, especially if you’re retiring before you’re eligible for government programs. 
• Talk with a therapist-specific CPA about how to draw income from savings or business assets in the most tax-efficient way.

Mistakes To Avoid

While you’re building a safety net, there are a few common mistakes to avoid to ensure you’re set up for retirement well:

• Student loans and busy schedules can make it hard to save, but every year of saving counts as you work toward retirement. A realistic savings plan is crucial to ensure you stay consistent with your savings goals. 
• Underestimating how much you’ll miss your work can lead to a farewell from practice that feels less fulfilling than you had hoped. Make a plan for how you’ll spend your time and stay connected with your community. 
• Forgetting about taxes and health insurance while planning for retirement can set your plans back. Those costs can be bigger than people anticipate; be as realistic as possible while planning.

You Have Options: What Retirement Can Look Like In Real Life

Retirement doesn’t have to be all or nothing.

One therapist might maintain a small practice of long-standing clients and dedicate a few hours each week to supervision. Another might shift completely to teaching or consulting. Someone else might decide to fully close their practice and devote their time to travel, family, or new creative projects. All of these count as retirement because the work becomes optional.

Ready When You Are

Retiring as a therapist isn’t about reaching a magic age. It’s about reaching a point where your finances, health, and personal goals align, allowing you to choose whether or not to continue working. The good news is you don’t have to figure it out alone. With planning and support, you can make the transition gradual, protect your well-being and legacy, and step into retirement with confidence rather than guesswork.

At Traktion Accounting, we specialize in helping therapists and mental health professionals map out that path. We’ll run the numbers with you, help you plan for taxes and cash flow, and show you what your retirement options really look like. 

If you’re ready to turn retirement from a vague “someday” into a concrete plan, reach out to us today. We’d love to help you get there.