How to Calculate Your Private Pay Rate (And Actually Charge It)
“What should I charge?” is the wrong question.
The right question is: “What do I need to charge to sustain my life and my practice?”
Most therapists pick a rate by looking around at what other therapists charge, picking something in the middle, and hoping it’s enough. That’s not a strategy. That’s a guess.
Your rate isn’t about your worth.
Let’s get this out of the way: I don’t believe in “charge what you’re worth.” You’re a human being - your worth isn’t quantifiable. And frankly, that framing keeps therapists stuck, because they tie their self-esteem to a dollar amount.
Your rate is about math. What does it cost to run your life and your business? That’s your starting point.
The actual calculation.
Here’s the simplified version:
Add up your monthly personal expenses (rent/mortgage, food, utilities, insurance, debt payments, everything)
Add up your monthly business expenses (EHR, liability insurance, subscriptions, continuing education, etc.)
Add those together
Multiply by 1.3 to account for taxes and self-employment costs
Divide by the number of sessions you want to see per month
That’s your minimum sustainable rate.
Notice I said “sessions you want to see” - not “sessions you could theoretically cram into your schedule.” If you want to see 20 clients a week and take actual vacations, calculate based on that.
Why therapists resist this.
When I walk therapists through this calculation, they often land on a number higher than what they’re currently charging. And then the panic sets in.
“No one will pay that.” “I’ll lose all my clients.” “That’s more than other therapists in my area charge.”
Here’s what I know: there are therapists in your area charging more than you, seeing full caseloads. The difference isn’t their credentials or their experience. It’s their confidence and their clarity.
The real barrier is internal.
Most pricing problems aren’t business problems - they’re money story problems. The messages you absorbed growing up about money, worth, and who gets to have nice things. The implicit lessons from grad school that therapists should sacrifice. The guilt about charging for help.
This is why I spend the first two weeks of my intensive coaching program on money mindset before we ever touch strategy. You can know what to charge and still not be able to do it if your internal wiring is fighting you.
What to do with your number.
Once you’ve calculated your sustainable rate:
Say it out loud. Ten times. Notice what comes up.
Practice stating it without apologizing, explaining, or immediately offering a discount.
If there’s a gap between your current rate and your sustainable rate, make a plan to close it.
Maybe that means raising your rate for new clients immediately. Maybe it means a gradual increase for existing clients. Maybe it means having some hard conversations. But you can’t build a sustainable practice on an unsustainable rate.
Ready to run your numbers? Use the Private Pay Rate Calculator - it factors in taxes, time off, and the expenses most therapists forget.