Setting Fees As a Therapist

Setting fees can be tough, but before doing the math, you may want to reflect on your journey and beliefs before jumping into that math equation.

Setting fees in private practice can be overwhelming, and can bring up complicated feelings and ideas of your worth and value as a therapist.

When I first started out, I attended a training about money and setting fees. In that training, I distinctly remember being advised before I even started to think about setting fees, that I should first think about the time, money and effort it took me to become a therapist. In other words, how much have I invested in my graduate education and obtaining my license? So I thought about graduate school and paying thousands of dollars, my student loan debt, the 3,000 hours of clinical work I did including the free work at as a trainee gaining hours in school, the money I spent in preparing and studying for my licensure exam, not to mention the costs to my own mental health working long hours in community mental health.

As therapists, we didn’t come into this field for the money, and the truth is, they don’t teach you about money in graduate school or any type of marketing for that matter. One thing I feel that maybe we adopt as therapists, is that it’s more about helping people and that money shouldn't matter as much. But I do believe we work hard to get here, and we should get paid for it.

So when it comes to starting a business, it's important that you do the math. But before that, there was something else I came across that was helpful for me to think about regarding fees.

One thing I read recently was very helpful was recognizing the false beliefs that therapists fall into. According to psychologist Dr. Marie Fang, a common mistake that happens when therapists set fees is undercharging.

In her article, Set Your Hourly Rate in Psychotherapy Private Practice, she explains these important mistakes in thinking:

Lower prices attract more clients to you and allows your practice to fill up faster. But in fact, Fang says that lower prices may actually turn clients away. Fang also describes that a lower fee may not attract your ideal clients and also may attract clients that are just not that invested in therapy.

I think this is an important shift in perspective.

When you think about it, lowering your fee in order to get more clients seems like a perspective of lack rather than abundance. Not to get totally woo woo, but if you come from a perspective of abundance, where you can trust you can set a fee and that the right clients will come to you, then this is the first step in attracting your ideal clients.

You want someone to be invested in therapy. You want someone who will be willing to pay your fee because this means that they are willing to invest in you. Someone who is unwilling to pay your fee, may not be the right fit for you in your practice. More on ideal clients (here).

With all that said, now it's time to do the math.

Referencing back to Dr. Fang’s article, I found her equation to be helpful with some things to also consider:

(Ideal Yearly Income + Yearly Expenses) ÷ Number of Yearly Work Weeks ÷ Number of Weekly Clients = FEE

First, think of your ideal income per year. Not only about how much you want to make, but also how much you want to make that will allow you to have the lifestyle you want. Are you budgeting for vacations, dining out, going out, self-care, or other hobbies? This piece is important going back to the idea of abundance, are you setting up your fee structure to fully support your goals, lifestyle and dreams?

Then when considering your number of yearly work weeks, are you considering the time off you want to take during the year? It’s important to consider this when you can easily burn out without taking time off.

Then lastly, thinking about your number of weekly clients, think about a number that is going to sustain, but not overwhelm you. Caseload is an important thing to consider and it shouldn’t just be solely based on the numbers. Read more about determining caseload in another article (link).

Although setting fees can bring up a lot of feelings, when it comes down to it, the work we do changes lives and there’s no price tag for that. But maybe we need to be reminded that this work is valuable and our fees should reflect that.