Fee Setting: How to Set Your Thrive Fee
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Welcome back to Therapist Expanded! Today Erin is doing a solo episode on one of her favourite topics - Fee Setting!!
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Erin starts by reading what she recently wrote to her email list about the topic of fee setting in order to set the stage for the topic and act as an outline.
She goes further say that this is likely a part 1, and that she’s going to cover how people usually set their fees, a Thrive Fee system she teaches, and then briefly why people don’t usually set their fees according to the system she lays out (i.e. the blocks or pitfalls). She shares how in the next fee setting episode she’ll cover more about the topic of how to actually approach implementing the Thrive Fee (and she alludes to that it’s about State, Story, and Strategy), and one of the ways she overcame her money stories by investing in herself.
Erin lays out how she’s been supporting therapists to set fees since 2017, and how therapists usually look to what she calls Worth, Value, Comparison and Fantasy as ways to set fees - and how these do not really work to create a sustainable and THRIVING life for the therapist or helping professional. She also shares that when she started setting her own fees in 2016 she did all the things she now cautions against.
Erin defines the four ways people usually set their fees:
- Worth: This gets tied into self-worth and doesn’t have anything to do with setting fees but is compelling for the ego (Erin uses a thought experiment to demonstrate how worth cannot be earned or defined by anything we do or charge)
- Value: Helping professionals put off raising their fees to what they need to be well and abundant because they ‘need’ more trainings or certifications.
- Comparison: This is where helping professionals start comparing to what others are charging and this is not relevant to the individual’s situation, and they have no idea how the other person is setting their fee.
- Fantasy: This is a step where helping professionals imagine what other people will or won’t pay or can afford.
Setting too low a fee starts to become a problem pretty fast, and then it affects our ability to stay well and affects the work.
Erin feels like it’s almost an emergency in her body when she sees therapists setting their fee too low for their needs because of the stories related to them needing to increase their worth/value first (i.e. they are setting based on what feels the most comfortable short term and sacrificing their long-term wellness).
Setting a Thrive Fee:
- Do the math to figure out what you need financially for your basic needs to survive per month.
- Write down what you need to Thrive (this is not the numbers - but is how you need your income to be the loving supportive container); this includes things like retirement savings, massages, vacation etc.
- Apply the numbers to what you need to thrive (don’t play with these or fudge these - just assign numbers) and do this based on a month.
- Decide how many weeks you are going to work a year (account for time off for vacation, sick time, etc.)
- Take the numbers you’ve calculated for the month and multiply by 12. This is your take home amount you need per year.
- Then multiply that by how much you will need to put away for taxes and then your estimate of how much you will need to pay for expenses (example is multiplying by 25% for taxes and 30% for expenses - these are examples as Erin is not an accountant, and an accountant could be a helpful asset here).
- Then divide that total by how many weeks you’d like to work per year (let’s call this number X)
- Decide your number of hours you’ll work per week to Thrive (be realistic here - Erin has seen numerous therapists say they want to work 20 hours per week, to then realistically feel like they’re thriving at 16 hours per week. Also calculate in here if you want to offer pro bono and sliding scale because that may mean more hours to make the same income).
- Divide X by how many hours you want to work per week and that is your Thrive fee.
Once you have the number, prepare for that you will likely want to start fudging the numbers and rely back on the 4 factors mentioned above. Remember this may be uncomfortable in the short term but look to the long-term and remember not setting a Thrive Fee turns into a problem over time.
Stay tuned for the next episode on fees to help you get into the state, story and strategy needed to actually make this change to charging a Thrive Fee.
*Hey! What's Your Therapist Fulfillment Flavor? Take the QUIZ to find out and see how much your fulfillment really is like ice cream!
On a serious note, this quiz could illuminate the beginnings of a path to your fulfillment so take the QUIZ today and receive curated content just for you!
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