The Foolproof Way To Set Your Rate in Private Practice
Today we are going to give you our best tips to set your rates in private practice.
The task of setting your rates is the biggest choice you are going to make when starting your private practice. If you don’t set your rates correctly you will have no business and your private practice will fail.
That’s a lot of pressure, right?
When starting your business, this should be the first step you take.
In order to properly market for your private practice, you have to have rates set to do so.
We have watched so many other therapists make this one FATAL mistake, so take our advice and don’t do this to yourself.
Why may you ask?
Well for starters, you’re sending the message to the community that you are having trouble filling up your practice. Which makes you look like you aren’t good at your job.
It’s the empty parking lot effect. If you drive up to a restaurant you have never been to before and the parking lot is empty, you most likely will assume the restaurant isn’t good and drive away because the lot is empty.
The same concept follows for your rates, so keep your rates near the rest of the crowd. It speaks volumes about your value.
Let’s get started with how to calculate the ideal rate for your private practice.
- First, you will want to determine your ideal income for the year.
- Then you want to add in expenses for the year.
- Divide that number by the number of weeks a year you plan on working.
- Then divide that by the number of hours per week you plan on seeing clients.
- The number you come up with is how much you should charge per hour.
Let me give you an example in numbers. Let’s say your ideal income is $100,000. You will take 100,000 then add your expenses which we will say is 30,000.
You take the 130,000 and divide it by the number of weeks you want to work a year, which we will say is 45.
2888.89 which you then divide by the number of hours you plan of seeing clients per week which we will say is 30.
This puts your rate at 96.30 an hour.
If you plan on using a sliding scale remember to add in the lowest rate for your highest cap number of clients you will see with a sliding scale at once.
We strongly encourage you to never see more than 30 client hours in your workweek. You will still have to spend 12-15 hours a week creating content, paperwork, and marketing for your private practice.
If you haven’t seen our blog on burnout I have it linked right here. Burnout is something that should be in your thoughts as you are setting your hours per week.
If you are confused about why we choose 45 weeks, we have factored in vacations, because yes, you NEED to take some time off too, plus holidays.
Leave us comments on how much this video helped you set your rate in private practice.
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