WHAT TO CONSIDER WHEN SETTING YOUR PRIVATE PRACTICE RATES | EP 110
Are you having trouble deciding on a starting rate for your private practice?
There are so many ways to figure out how to start off. For example, your college or association may have a recommendation, or basing your rate on what other therapists are charging in your area – but these guidelines may not be enough to allow you to be profitable!
You may need to look at your budget to know where to set your rates in order to give your Canadian private practice the best shot at being successful. In this podcast episode, I talk you through a basic exercise that you can do to help you decide what your rate should be.
Jane is an all-in-one health and wellness practice management platform designed to be helpful to you, no matter how or where you practice. Available online and on any device, Jane offers branded online booking, beautiful scheduling, insurance management, customizable charting, online intake forms, patient reminders, integrated payment processing, online appointments (telehealth) and more! Use the code FEARLESS at signup to receive your first month completely free!
In This Episode
- Make it personal
- How to find your starting rate
- Final thoughts
Make it personal
You have to personalize your budget, and therefore your therapy rate. Sure, you can look at what other therapists in your area are charging to make sure that you’re not pricing yourself too high or too low, or you could check in with your associated college to see what they say.
However, whatever advice you get, you need to tailor it to what your personal and professional needs are. There is no one-size-fits-all approach to budgeting; you’re going to have to understand your numbers and you’re going to understand your needs!
‘As we all know it has gotten really expensive to live in some areas in Canada … There are so many bills that may potentially need to be paid … That can sometimes make it difficult to figure out your starting rate if you’re only looking at what your college is recommending, or what other therapists in your area are charging because their costs of living could be different.’ – Julia Smith
It is a bit of a dance to figure out what to do in this situation, and I know because I’ve been there! If you want some more in-depth advice, you can download my free e-course or purchase my workbook.
How to find your starting rate
One of the main reasons why people start private practices is because they want work-life balance. So, let’s say:
- At a maximum that you want to see four people a day for five days a week, that’s 20 people per week
- You want to take four weeks of vacation
- You take 10 sick or personal days
- There are five holidays
With these calculations, you’ll probably be working around 45 work weeks per year. Now, a common rate is $150 CAD, which I’ll use in this example. If you charge:
- $150 CAD x 20 clients, that is $3000 per week
- $3000 CAD x 45 weeks, that is a total of $135,000
This may seem like a lot of money, but you have to take income tax into account, as well as your business expenses. I recommended subtracting 50% right away for income tax and business expenses, and whatever is left is your bonus for the year.
‘But, for that 50%, it would go towards rent if you’re seeing people in person, your practice management software and I use Jane App for that – it’s fairly affordable, around $80 CAD a month … You may have hired VAs, clinical insurance, clinical supervision, accountants, website development … So many things that you have to pay for!’ – Julia Smith
So, once you subtract this 50%, you could be left with $67,500 CAD.
With retirement, it’s recommended that you put away 10-15%, and now you are left with a total of: $57,375.00 and divided by 12 months, that is $4,781.25 CAD.
‘Now that may be enough to just cover the bills, but now you have to think about this equation, and that it’s based on the fact that you’re completely full for the entire year, and as we know, that is never the case.’ – Julia Smith
Final thoughts
In Canada, $150 CAD may not be enough to charge for a session, but I know that it can be difficult to charge more. There are lots of factors to consider, but don’t lose hope! There is a sweet spot that you can find with your numbers when you start working with them.
‘This exercise can just be helpful for you to figure out exactly how much you need to be charging in order to pay the bills or to have the ideal life that you need to be a great therapist, and not be burnt out.’ – Julia Smith
So, consider doing this exercise to get clarity about the rate that you would like to get to!
Connect With Me
Resources Mentioned and Useful Links:
Ep 109: How to Build a Private Practice Website | EP 109
Learn more about the tools and deals that I love and use for my Canadian private practice
Article: How to Set Up a Canadian Private Practice Website
Sign up for my free e-course on How to Start an Online Canadian Private Practice
Jane App (use code FEARLESS for one month free)
Rate, review, and subscribe to this podcast on Apple Podcasts, Google Podcasts, Spotify, Amazon, and TuneIn
About Julia
Julia Smith, MEd, RCT, CCC is a registered Counselling Therapist who owns a group private practice in Halifax, Nova Scotia. She is also the owner of Fearless Practice Consulting and hosts the Fearless Practice podcast. Through the Fearless Practice podcast, she provides invaluable insights and practical advice on starting and growing a successful Canadian private practice. Julia’s wealth of knowledge also extends beyond the podcast, as she provides personalized one-on-one consulting to therapists who are feeling burnt out and overwhelmed with their solo or group private practices. With Julia’s expertise, therapists can confidently navigate the complexities of owning a private practice and find work life – balance.
Julia also has written articles for the Canadian Counselling and Psychotherapy association. You can learn more at www.ccpa-accp.ca/blog/.
