The Separation Strategy Every Therapist Coach Needs

Hello, my friends. We need to talk about something that I know is quietly keeping so many of you stuck, and it is this fear that if you start a coaching business, you're gonna lose your license. I hear it all the time. Carly, is this even legal? What if my licensing board finds out? Am I allowed to call myself a coach? Am I allowed to market my credentials as a coach? What if I accidentally cross a line and I lose everything I worked for? Listen, this does not mean that you're not cut out for this if you have all of these questions. This just means you're smart, you're discerning. Smart people ask questions. It means you care about doing things the right way. You worked really hard for your license. So what I wanna do in this episode is remove the fear, replace it with clarity. I'm gonna answer all of the most common questions I hear about protecting your license when adding coaching, cuz here's the truth, you're not gonna lose your license for becoming a coach. You can put your license at risk if you don't understand how to properly separate the two. And that's what's not going to happen under my watch. So today I'm going to walk you through what actually needs to be in place to protect your license, what gets therapists in trouble, and how to confidently build a coaching business the right way. Let's dive in. Let's talk about what's really going on. Let's just name what's actually happening for most of you. You've been thinking about coaching for a while. You've Googled it, you've scrolled past all the therapists turned coaches who are doing the thing. You've Googled what's the difference between therapy and coaching. You've Googled how can I protect my license when adding coaching. You've bought a course or two. Maybe you've started mapping out ideas, but every time you get close to taking action, there's this voice that kicks in. What if I mess this up? Am I doing this the right way? What if I say the wrong thing? What if somebody reports me? So instead of moving forward, you stay in a research mode, hence the nonstop Googling. You're overthinking, you're having conversations with other clinicians who are telling you you can't do this, or you can do this. You don't know who to believe. You're waiting, you're second-guessing. And what I want you to understand is this: you're not stuck because you don't know how to coach. You know how to coach. I would say you're probably already coaching. And it's just happening under your quote-unquote private practice because you're a therapist who has a private practice. Therefore, you think you're doing therapy, and yeah, you are doing therapy sometimes, but sometimes you're probably also coaching. I think therapists get so tripped up about what they're actually quote-unquote doing, like, what am I doing right now? Am I doing coaching? Am I doing therapy? And they get all weird about it. We're going to talk about that a little bit later in the episode, but It's not always about what you're doing, the modality that you're using. It's really the problem that you're solving. Are you treating medical necessity, or is it a more situational, non-clinical, less severe problem? If it's the latter and it's a less severe, more situational problem, you're not treating medical necessity, well, guess what? You're coaching. So I could bet money, because I see this all the time, and this is me in my own private practice, that you're coaching already, but you're still stuck in the state of, I don't feel safe enough to start. I don't feel safe enough to create a whole separate business just for coaching because I don't want to mess up my license. I don't want to jeopardize what I worked for. So here's the most important concept in this entire conversation. We have to understand the core difference first before we move into the nitty-gritty logistical things that you need to do to protect your license. Maybe you've Googled, what is the difference between therapy and coaching? Maybe you've left more confused. I would say the most confusing definition, the one that I disagree with, which is maybe one of the most common definitions, is therapy is treating the past and coaching is treating the present and the future. Well, I know as a therapist and a coach, you can treat and work with past, present, and future in both a therapeutic and a coaching relationship. So I alluded to this earlier, but I'm really going to drive this home now. The definition and difference that I would like for you to adapt, and that is therapy is treating medical necessity, textbook DSM criteria, medical necessity. Coaching is more situational, non-clinical, less severe problem. Therapy is diagnosis, treatment, clinical care. Obviously you can, you know, bill insurance. Coaching is that more situational support, guidance, accountability, education. It's a situational, non-clinical, less severe problem. You are not treating them for diagnosis. The mistake that most people make is thinking it's about the tools you use, because when we hear CBT, DBT, EMDR, we think therapy, rightfully so. However, you can actually use those modalities in your coaching practice, and most of my clients do. And believe it or not, there's CBT coaching certifications. Like, just Google it if you don't believe me, right? So we can use similar frameworks, what it really comes down to is, are you treating diagnosis— that would be therapy— or is it that more situational, non-clinical, less severe problem— coaching? I have many of my clients who are certified in EMDR, and they actually use it inside their coaching container. So don't let that trip you up. What actually puts your license at risk is when things get sloppy, when you're not drawing a line between therapy and coaching because maybe you don't know the difference. Right? Maybe you're taking a therapy client to a coaching client or a coaching client to a therapy client. That's a big no-no. That's considered a dual relationship. They can't unsee you as their therapist. Maybe you're marketing in a confusing or misleading way. Do you have to hide your credentials? No, but you can't just lead all of the time with, hire me as a coach because I'm a therapist. They're gonna be like, well, what am I hiring you for? You know, are you marketing your therapy services? Are you marketing your coaching services? So do you have to hide your credentials? No, it's definitely a huge point of difference that you have, that you hold a license and you have a clinical background, but that can't be your lead marketing tool is hire me as a coach because I'm a therapist. You also can't operate under the same structure with no separation. You have to have a separate business entity. So the key word for you to remember in all of this is separation. Everything needs to be separate.

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Now I'm gonna answer some of the most common questions that I know are maybe already coming up in your head, and I'm gonna deep dive into much more of this on a more granular level inside the April 21st training. So definitely scroll down to the show notes and grab your ticket for that because you'll have a chance to come off mute and ask your burning questions about protecting your license. But on a high level, I wanna go ahead and answer some of your burning questions now that I know you may have. The first one is, can I have both a therapy practice and a coaching business? The answer is yes. Most people do, you absolutely can. It's not an either-or thing. You can keep your practice, but you need to have a separate business entity for your coaching business. They must be structured correctly. Is a DBA gonna suffice? No, it's not. Do I need a separate business? Yes, you need a separate LLC, for example. Okay, now I know that's not what people wanna hear cuz it's like, ugh, I gotta have two of everything. All right, well, you know, it's not that hard. Once it's done, it's done, and you're gonna have the peace of mind that you're doing it the right way. But your therapy business and your coaching business, they're two completely different services with different risk. You need to have different liability insurance for each one. Most of my clients use CPH, so it really needs to be treated like two separate entities, two ships. If something goes wrong in one, you don't want it taking down the other. Do you need a separate bank account? Absolutely. Your therapy income is state-based. Your coaching income can and will be global. If you mix them, it's going to look like you're practicing therapy across state lines, even if you're not. You can't be taking in revenue worldwide when you're only licensed in X state. That's going to be a red flag. And can you coach your therapy clients after? So they've been in therapy for X amount of time, you're not really treating them for medical necessity anymore. Can you move them into your coaching container? No. And I know that's tempting, but once somebody sees you as their therapist, they can't unsee you that way. And that does create that relationship, which is exactly what we want to avoid. Now, with this being said, and I talk about this in my book, I have a whole chapter on protecting your license. I have a whole chapter on marketing. If you haven't booked and picked up my book, I highly recommend you do so. It depends on your board. I'm a social worker. Once a client is a therapy client, always the therapy client. We are never allowed to take them into a coaching relationship. If you're a mental health counselor, They say after 2 years it's fair game. So there is some nuances to this quote unquote rule that you can't take a therapy client to a coaching client. Always check with your board to see, is it more like social work and it's super strict, or do you have a little bit of wiggle room? And what exactly does that wiggle room look like? Can I use my credentials in marketing? Yes. I talked about this, but carefully. So you don't have to hide your license, but again, you're not saying hire me only because I'm a therapist. You can say in your bio, for example, I have years of experience helping clients achieve XYZ as a clinician. See the difference here? Can you use things like CBT and coaching? Yes, we talked about this as well, but you're teaching principles. You're not treating a diagnosis. It's more like psychoeducation, not treatment. There's a big difference here. And again, you're going to screen them when they're coming in. You're doing a consult call and you're gonna figure out, all right, do they need to be treated for medical necessity or can they be coached through this? Perhaps they are actually going to have their own therapist and they're working on being treated for medical necessity with their therapist. And in the relationship that you have with them, it's going to be more situational. I have a therapist turned coach client who worked with women who came out of DV relationships, and a lot of them were meeting criteria for PTSD. She was not treating them for PTSD— she did in her private practice— but in her coaching business, she had a program that specifically helped them boost self-confidence and get back into the dating world. So she was not treating them for PTSD, she was not treating them for diagnosis, even though they could be meeting one. She was very clear that, hey, if you are to come into this coaching container. This is exactly what it's for, and this is exactly what we'll work on. Clarification is key. What about clients with real mental health issues and they need therapy? Well, they should be in therapy. I'm not saying coaching is a replacement for therapy. There is absolutely a time and a space and a place for therapy, just as there is for coaching. So it's not meant to replace, it's just meant to be a different avenue. I think some people can really, although the stigma has gotten better, really only fathom getting help under the coaching umbrella when the reality is they need to be treated for medical necessity, or vice versa. Somebody thinks they need therapy when in reality they're not meeting criteria for diagnosis. You would be giving them maybe adjustment disorder or anxiety unspecified, and they can actually be coached through that situational, non-clinical, less severe problem. Another thing I hear all the time is, Carly, I feel like coaching is going to be a downgrade. And I really want to challenge that because I completely disagree. Coaches can't be therapists, but therapists, we make some of the best coaches. Maybe that's me being biased, I don't know. But it's not replacing your identity, it's expanding it. I always call it a bonus identity. And the truth is, some clients stay in therapy for years, spending tens of thousands of dollars on average, maybe $150 a session, 3 years. That's about $36K. When in reality they didn't need to be treated for medical necessity. They could have came into your perfectly curated signature high-ticket program, $3,000 to $5,000, a 4-month program with like-minded people on the same exact journey and gotten faster, easier results with a proven system. That's the ultimate win-win. You're gonna save them years of their life, thousands of dollars, get them faster results. And you're also going to leverage your time, technology. You won't have to repeat yourself, leverage all of your clinical knowledge. You're going to have more freedom. What is better than that, right? So again, a time and a space and a place for both, but use your clinical discernment. What are they a fit for? They don't necessarily get to decide. It can be confusing for us to even understand the difference between therapy and coaching. So what makes us think that our clients are fully going to understand that? Okay, really quick. If you're listening to this and thinking, this all makes sense, but I don't trust myself to navigate this alone, I have something for you.

I'm hosting a live 90-minute workshop called How to Protect Your License When Adding Coaching. It's happening April 21st.

Grab your ticket. It's in the show notes. If this episode is hitting for you, this is gonna be your next step. We're covering legal structure, what to say, what not to say, how to set up your offers, how to separate everything properly so you can stop guessing. I'm walking you through the exact framework I created with my attorney, same framework I've used to help well over 400 clinicians add coaching, build their coaching business safely, ethically, legally. I can't wait to see you there.

It's all happening April 21st.

All right, let's get back. What I wanna drive home and end with is if you feel stuck, it's not 'cause you don't have options, it's just because you don't have the clarity you need and the next steps. And when you don't feel clear, you don't move. You stay in analysis paralysis. We've all been there. But when you understand how to do this properly, everything opens up. I always say the fear of protecting your license is not an excuse to not add coaching, to not have an additional revenue stream, to not impact more lives, to not have the freedom, flexibility, and security that you so deserve and desire. You can scale your income, you can work with clients globally, you can create leveraged offers, and you can still protect your license. It's honestly not that hard, especially when you have the blueprint that I'm giving you. I give you everything. I give you attorney-approved coaching contracts, privacy policy, disclaimer, terms and conditions, everything that you need to have on your website, clauses that you can add to your private practice paperwork. It's all there for you. It's not that hard. What insurance to get, where you can go. What to say to your clients. So here's what I want to leave you with: you are not stuck because you can't do this. You can do this, you just don't feel safe enough. And my job as a therapist turned coach myself, one who has coached thousands of clinicians to successfully build their coaching business ethically and legally, my job is to make you feel safe doing this. Because adding coaching will absolutely change your life. It will change your client's life. It will change the world. We are creating a movement right now, Therapists Adding Coaching. You see it everywhere. I know you do. You can stop overthinking. You can stop waiting. You can finally build the business that you have been thinking about for months or for years. You have worked way too hard for your license to stay stuck in a model that no longer fits your life. You don't have to choose. You don't have to choose between being ethical and being successful. You get to have both. So if you're ready for that next step, I'd love to invite you to join me on April 21st where we're gonna talk about this in much more detail. I cannot wait to see you there. The link is in the show notes. My love is with you, and I'll see you in the next episode.