Money is something we all want to make but don't want to talk about it. This week's challenge is to look at your financials and understand your fee setting process. Why? It impacts the therapeutic relationship as well as the viability of your business.Read More
Ok... let's start by saying this: Private practice is not a get rich quick scheme. This article isn't about making 40k in 2 days, or being salesy, sketchy, or unethical in the name of building your private practice.
But, some of you are struggling financially. And that struggle is making it difficult or impossible to maintain being in private practice and working with the clients who desperately need you. Or, at the very least... not making a decent income is making you seriously question your life's work, or making you feel burnt out and exhausted and sucking the joy out of the work that you love. You might need to make some changes and some decisions to get money flowing in your practice in a more meaningful way. And let's be honest- you might need to happen relatively quickly.Read More
This is an interview for anyone in private practice. W Sliding scale fees are common in practice but what Open Path is doing for access in the private practice sector - well you have to listen to hear about how good it is!Read More
Welcome to Lesson #2 on How to Set your Fee!. Here is what you need to do:
1) Watch the video
2) Calculate fee for current financial goals
3) Evaluate revenue streams and assess if they are viable for your financial goals (insurance companiesRead More
Maybe you have your tax planning, retirement, disability coverage and cash flow all figured out. But if you don't, this is for you. This is to encourage you to start learning, even in baby steps. I (Kelly) used to find this stuff intimidating. So I've reached out for support and every year, it gets better. I don't feel so fearful and I know what is currently going on in my business while I am reaching new personal and professional financial goals.Read More
Shame in Private Practice?
Before someone can officially be accepted into our Business School Bootcamp for Therapists, we have to interview them. And, they have to interview us. It is really important to us that people only sign-up if this is the right program for them, and they are someone who we will enjoy working with.
I ask several questions- but one of the most important questions I ask is: If we were to fast-forward to the end of the bootcamp, and you got the perfect outcome- what would it be? (Nothing like sneaking the miracle question into a program for therapists!)
Now, I expected therapists would tell me things like:
"I would have more full-fee clients."
"I will have a great business plan for my private practice."
"I will know how to get the phone ringing."
"I will finally understand how websites work."
And while yes, sometimes people would say these statements- it often was NOT the overarching goal or hope. What they verbalized again and again was that they wanted to feel confident. They wanted to feel connected. They wanted to feel sure of the next steps in their private practice. They wanted to feel validated that they had taken the right step in opening a private practice.
The first time someone said I nodded. It made sense. The second time I heard it... and then the third... and I just kept hearing it.... From therapists who were starting a new private practice, from therapists marketing established private practices, from therapists with no clients, from therapists with tons of clients...
Therapists want to feel confident in private practice.
In so many areas, we get feedback, supervision, consultation- but business building isn't one of them. And the truth is, the business issues of private practice are so tied into clinical effectiveness. Think about it, in the most core way, if our private practice marketing isn't set-up properly- we can't see clients- because we won't have any!
If you have tons of clients, but they aren't paying you well- you also won't be able to keep your doors open.
Shame in Private Practice
Unfortunately, it isn't just that therapists often lack confidence in how to apply business knowledge in a private practice. Therapists can also begin to internalize that the lack of flow or success in their private practice is a reflection of their value as a human! We put so much work, effort, and intensity into being great at our craft. When things aren't flowing in our private practice- it can lead to feeling less than, bad, or even ashamed.
Ditch the Private Practice Shame
Here is the truth, many therapists feel just like you do. You are normal. It is ok. Notice it, and come up with a plan to move away from feeling not good enough, confused, lost, or even ashamed. Learn what you need to learn. Get the support you need to lean on. Learn the skills you need to enjoy running a private practice!
Confidence is something that happens as you grow, learn, and get support. The lack of confidence that you feel today is simply a signal that something needs to shift or change. It is NOT a reflection on you as a human, or on you as a therapist!
I love LinkedIn! Did you know that? My favorite thing? Meeting new people I would've never connected with there! Melanie Yost, LCSW is one of those people that I stumbled upon, reached out to, and we just clicked! I love that!
I felt like she had some incredibly powerful things to say about what therapists learn and experience about money based on this poverty mindset. Give it a watch, give it a listen! Want to interact live and talk about fees in private practice? Please join us for the free training on setting fees in private practice.
What did you resonate with? What did I say that rubbed you the wrong way? Comment below! We have a few other snippets from our conversation that we will be posting later!
Your private practice is a calling, something you were meant to do. We get it. But, did you know that even churches have business plans? They might call them launch plans, but they are still a business plan.
Why does a therapy practice need a business plan?
The same reason you need a budget and a plan at home. Because it takes income to buy food, pay rent, send kids to college, and to live. Your therapy practice can only help people if the doors stay open.
But I don't need to make a lot of money in my therapy practice.
I talk to therapists who are relying on their spouse's income and insurance benefits. Their spouse is, in many cases, actually supplementing therapy services for the community. Which would be fine if you were starting a non-profit.
If you are starting a private psychotherapy practice, it is considered a for-profit venture. And, if you don't make a profit after a few years- the IRS can determine that your work is actually a "hobby" and disallow any write-offs.
What if life changes?
People die. Jobs are lost. The work we do is hard. The cost of going to inspiring trainings, getting ongoing supervision or consultation (even after getting licensed), and taking time off is high. Whether you decide to save your profits, give them to charity, or buy a beautiful handbag is your business.
In today's world, it makes sense to have a back-up plan. Just because you don't have to make money in your business doesn't mean you shouldn't. It doesn't mean you should devalue your work, training, expertise, and the profession by charging a rate that doesn't match the expenses of the business or the expertise of the provider.
What is a Private Practice Business Plan?
It is a document that outlines how many clients you are going to see, your expenses for the year, your marketing plan, and projects your annual income. It outlines this for the next 3-5 years, and shows the rate of projected growth over that period of time. It includes an analysis of the clients you will serve, the competition in your area, how your services are different, your services and the pricing structure. It includes a mission statement, and so much more.
Why don't most therapists have business plans?
We were not taught how to develop business plans. When we ask colleagues how to start private practices, many of them stumbled through the process- so we replicate what they did. Unfortunately, just because someone is "busy" or "full" doesn't mean they have a profitable private practice. You can have a busy, full practice that is barely scraping by, or that isn't making any profit at all!
Your clients want you to be around.
I know you are not going into private practice willy nilly- this is a big decision! While many of your clients may only work with you for a few months, some of your clients are signing on for intense work that may take years. They are trusting that, if it is within your power, you will be around to complete it with them.
Life happens, you may have to move our close your practice for a variety of reasons. Not being able to pay the rent should never be one of them!
Looking for a template to follow? Here is a great business plan creator from the Small Business Administration.
Want something that is more therapy specific? Consider finding out a bit more about our upcoming Business School Bootcamp. We dig into business planning and help you start the process to reduce the overwhelm!
Whatever you do, if your private practice isn't where you want or need it to be, reach out and ask for help! There are great programs through Julie Hanks, Casey Truffo, Juliet Austin, Becky Degrossa, Joe Sanok. There are free podcasts, webinars, blogs, and so many people out there! There are so many people cheering you on and rooting for you to be successful! Go out there and be great!
Fees in private practice is a taboo subject for many reasons. One, it can be difficult to talk about within professional organizations because of anti-trust laws. Two, many people haven't been taught any process for setting their fee or developing a business plan. So, you have people making guesses, just doing what others are doing (without knowing whether that actually works or not), etc.
Over here at ZynnyMe we LOVE to have the money conversation with therapists. Why? Because it is such an important conversation. If you are in private practice or starting a private practice, you are a small business owner. If you don't have money coming in, you can't keep your business open. That is how business works.
Watch this awesome 6 minute video that we recorded with our friend Jo Muirhead. She is from Australia and has a wonderful voice and vision for discussing the money topic. Give it a listen, and then watch our full, free training on how to set fees as a therapist right here.
What did you think? Did you resonate? Did it just bring up more questions. Share your comments below.