Type size depends on the image resolution too. Check the resolution of your document.
I've checked the resolution and it's a large photo. I've also tried using other images.
No matter what I do, I still get small text on my image.
Is there a secondary setting or something? I'm using the font and point size selections across the top bar.
Select any of the type layers, and use Free Transform (Cmd t). Hold down the Shift and Opt keys and drag out a corner handle. Job done.
Now check the image size (Cmd Opt i). Regardless of the size in pixels, make a mental note of its size in inches or cm (depending on units)
Now open Preferences (Cmd k) and click on Units and Rulers. At the top you will see Type, that I strongly suspect will be set to Points. Use the drop down and change that to mm. Close preferences panel.
Now start a new Type layer, but remembering what the image size was. Lets say it was 20 x 25cm (about 8x10 inches), if you set the type size to 50, that =5cm, and you know to expect the type to be 25/5 = one fifth the hieght of the image.
I work in mm, so it is much easier for me, but I suspect Americans work mostly in inches. mm are still a lot more meaningful than points though, unless you work in print.
That's kind of long winded. Either use Free Transform to upscale if you really can't get the units to work for you.
Start the Type layer and drag the cursor across the double 'T' icon to the left of the text size in the Options bar.
But much better to get a handle on the whole Image size and resolution thing, and try to understand the units in Preferences.
I agree with Trevor that managing the resolution is the better way to go. Large images are now so common because they come from 16-20 megapix cameras.
If you increase the resolution of the image from 72 pixels per inch (which is the default for many images imported from digitai cams) to 300 Pixel per inch while maintaining the size of the image at 3000x2000 pixels, the physical size of the image goes from 41.6 inch to 10 inch. When you insert your font into a higher resolution image, you do not have to deal with font size of 200-300 pts just to look normal. Hope this helps.