Setting fees

You're Setting Your Fees Wrong

You're Setting Your Fees Wrong.png


I think you’re probably setting your fees wrong.


Sound harsh? I talk to therapists every day who are working hard, doing excellent work...and not making a good living. The process you use to set your fees is one big factor determining whether you’ll make enough money to feel some financial ease or make just enough to scrape by.


When you use the wrong process to set your fees, you’re likely to feel resentful and discouraged about how hard you work and how little you take home.


I kind of wish I could reach back into the past and tell the me of 15 years ago to read this article. But here I am now, sharing it with you, and that’s good enough for me.

Spoiler alert: I don’t know what your fees should be. Only you can know that. I do have a pretty great step-by step-process to help you figure it out.


How most therapists set their fees


Is this you?


You set a “full fee.” It’s based on a combination of factors including:


  • the going rate in your area (or what you think it is)

  • the biggest number you can imagine actually asking for

  • the number of years of experience you have (and what you think that’s worth)

  • the value you place on your services

  • the amount you are comfortable paying for your own therapy

  • The amount you think your colleagues would feel comfortable with you charging

  • The amount you think your current clients can afford


You also do a little math and decide that you could make enough if you multiply this full fee number by the number of clients you’ll be seeing.


If that’s the process you use, you’re not setting this full fee high enough. You’re setting yourself up to barely scrape by.


I’ll tell you why this process for setting your fee is failing you. Then I'll offer you a freebie, instructions and a video to walk you through my step-by-step process for setting your fees.


Why is the process so many therapists use wrong?


The process above is missing some important pieces, so it inevitably leads to you make too little.


I’ll go over 3 big pieces you should take into account next time when you set your fees.


Missing piece #1: When you set your fees, you didn't accurately account for your sliding scale. 

If you don’t have a sliding scale, you can skip this missing piece.


Sliding scales are great! I use one in my own therapy practice. Most therapists set them up badly.


Most therapists set their full fee using the factors I named above, and then make adjustments down from there on a case-by-case basis.


You might think that the fee at the bottom of your sliding scale is the problem. I think your problem is more likely the fee at the top of your sliding scale, your full fee.




Your full fee is the problem because you didn’t set it high enough. You need to set the fee at the TOP of the scale high enough that your average fee gives you financial ease.


With a sliding scale, fees only go down from your full fee. If you set your fee at 150, your next client isn’t going to say, “That feels too low for me. I’d like to pay $200 because my income is really robust right now and I have a trust fund.” It would be unethical for you to accept more money even if they said it.


You need to set your full fee high enough that every time you adjust your fee, you’re confident that your average fee will work for you. Otherwise your only way to change your average fee is to slide less.


Getting rid of your sliding scale all together is a valid choice, but it’s kind of a sad choice.


Wouldn’t you rather set your full fee high enough that you could easily afford to hold on to some lower fee spots? Wouldn’t you like to be able to slide significantly for a client you’d love to work with who has very little income?


Missing piece #2: You underestimated the interruptions in your schedule. 


You calculated your fee based on a full schedule. A full schedule is not how life works all the time.


Cancellations, attrition, vacations, illnesses and other interruptions all impact the number of sessions you have.


Almost all therapists UNDERESTIMATE how many interruptions happen in their schedules.


When you underestimate how many times you DON’T see all of your clients in a given week, you’re always financially stressed about cancellations and attrition. You’re always a bit hesitant to take time off. When you add up your income, it falls a little short of what you hoped.


When I ask a therapist how many sessions they have per week, they usually tell me the number of sessions they have regularly scheduled.


I suggest that you track your actual number of sessions. It’s easy. You can do it now. Just take the past 3 months, add up the number of sessions that actually happened, and divide by the number of weeks.


If your practice isn’t full yet, get realistic about how many sessions you will feel comfortable having each week, taking all of those inevitable interruptions into account.


You can also adjust your office policies and enforce them to decrease how much these interruptions hurt your business.


By the way, you need to take vacation and sick time. It isn’t actually something to be proud of if you never take a sick day. We therapists need self-care just like all other humans.


Missing piece #3: You're not allowing for savings


Savings? That’s something we therapists often leave out. When I was setting my fees early on, I don’t think I even used the word savings. Savings is the path to financial ease in your business and in your personal life.


You probably left out or underestimated the savings you need when you set your fee.


Let’s start with personal savings. You deserve to put away some money before you pay your bills.


If “savings” is too alien a word, try these instead:


  • Unexpected bill

  • Retirement

  • Unexpected health problems

  • Time with your family

  • Buying your next car with cash

  • Mortgage payoff

  • Rent increase

  • Caring for an aging parent

  • Travel


Then there’s business savings. Yep, you deserve to build savings for your business too. Occasional business costs come up that aren’t in your regular business budget. When you add up your anticipated business expenses, it’s easy to forget stuff. Unexpected expenses and opportunities come up now and then.


Here are a few examples:


  • You need a new sofa for your office.

  • A once in a lifetime training is happening in your town.

  • Your lease is not renewed so you need a new office deposit.

  • A bill you forgot about came in the mail.

  • Your website needs an overhaul.


If you add them all up, these occasional costs actually come up often. Sometimes a bunch of them happen at once. Imagine having that money already sitting in your business savings account before those expenses come up. Ah, peace!


It’s time to get ready to set your fees in a new way. Get my step-by-step instructions below. You'll get a video and worksheet walking you through the simple process. 

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Are You Afraid To Charge More Than Your Mentors?

Most of us earned a paycheck somewhere else before we started in private practice. Those work places used frameworks for deciding how much we got paid. In some places, we negotiated our wages. In others, our wages depended on what our union representatives had negotiated for us.

Some therapists expect that wage framework to show up in private practice, and they unconsciously try to recreate it. They look to therapists with a similar amount of experience to find out what their own fee should be. They look at what their mentors are charging and make sure to charge far less than that. They find out what interns are charging and make sure to charge more. These therapists are limiting their own incomes based on a structure that doesn’t exist.

What if your mentor chooses to keep her fees low because she’s independently wealthy, or because she paid off the mortgage on her home 15 years ago? On the other hand, what if your mentor has no idea what she could be charging? Do you really want to wait for her to raise her fees before you do?

I see therapists get distressed when they see other therapists not following that imaginary wage framework. If they hear of an intern charging more than an experienced therapist, they get confused or even mad. They express disbelief when a therapist with a similar level of experience charges twice their own fee. If you experience disbelief, confusion or anger when another therapists breaks the rules of this imaginary framework, its time for a mindset shift. 

In reality, you set your own fee.


You don’t have a boss to negotiate with any longer. You don’t have coworkers to compare wages with. Your fee is up to you, and the only people who need to approve of it are the people who choose to hire you.

Instead of deciding what you want to charge based on where you believe you fit in an imaginary framework, here are the factors I want you to base your fee on:

  • The value you place on your expertise and your work
  • Your living expenses
  • The financial resources of the clients you work best with
  • The value those same clients place on their healing
  • The number of sessions you want to schedule each week
  • The expense and time needed for your training, consultation and self-care
  • The monthly expenses of running your business

I encourage you to find a fee that works for you; a number that:

  • allows you to earn a good living
  • respects your time limits
  • makes room for a few low-fee clients
  • sets you up not to burn out.

When you set your fee that way, something interesting happens. You don’t compare your fee to other therapists’ fees as often. When you do, you feel more curious than stressed. You also make mental room for other therapists to leave that imaginary wage structure behind. Who knows? Seeing you behave differently may even rub off on your mentors. 

If it's time to build your practice in a big way, apply for a free consultation with me. What we come up with might surprise you. 

Don't Waste This Crucial Moment

You became a therapist because you wanted to help people. You wanted to relieve pain for your clients. As you became a great therapist, you got better at allowing your clients to struggle at times. You don’t always jump in with a quick fix.

There’s a particular kind of pain your potential clients feel as they are deciding to invest in therapy. When your client is getting ready to make that investment, she may struggle with making room for therapy in her life.  Therapy can be a big commitment of hard work, time and money. Until she’s ready to say yes to therapy, she might feel like she doesn’t have room in her budget or her schedule. She might need to be in significant pain before she feels she can make the investment.  

When you’re talking to potential clients before they have made that decision, do you allow them to experience that tension, or do you jump in and try to take the tension away with a quick fix?

Two common ways this tension comes up are around your schedule and your fee. Let’s say you only have a few openings in your schedule. When you name those times to a potential client, he says those times don’t work well. Maybe you feel tempted to jump in and offer another an evening appointment even though you don’t really want another evening appointment. Stick with your optimal times and let the client struggle for a moment. Let him consider making the changes he would need to make for one of those times to work.

Perhaps you have a new fee you’ve raised to recently, and you’re still getting used to saying it out loud. If you ask a potential client “is that okay for you?” you’ve just taken away an opportunity for her to say yes to making that investment in herself. Her decision might be “I can’t afford that fee right now.” Then you can be very generous with your offer of referrals. You may be connecting her with the therapist who is perfect for her.

If you’re willing to watch your potential client struggle for a moment, the client will know you are clear in your communication, that you’re taking care of yourself, and that you trust his or her ability to make the right decision. Before you start the conversation with a potential client, be ready to tolerate your own anxiety so that you can witness that struggle.  

If you need some help with your therapy practice, check out our free trainings.