[00:00:00] Linzy: Hello and welcome back for another Feelings and Finances episode of the Money Skills for Therapists podcast. These are our short episodes to end off the week to answer questions from you, the lovely listeners of the Money Skills for Therapists podcast, the therapists, health practitioners, coaches.

[00:00:19] Today we have a question from Margot Rochester. Here’s Margot’s question.

[00:00:25] Margot: Hi, Linzy. This is Margot Rochester. I also live in Ontario. I think you do, too. When I saw the word scaling, my interpretation was how we would scale for clients, for example, who might not have enough money for our regular fee. And so we agree toallow them to pay less. And this has been an ongoing struggle in my practice, an ongoing piece to think about.

[00:01:00] So there are people who I charge my full fee. And I feel good about the fee that I charge currently. But I can also fall into this thing where I’m like, this is how much I charge. And. at times feel a little bit like, is that too much, and then let them know that I have a sliding scale.

[00:01:22] But there are so many ins and outs, to this issue, as you can imagine. And I do some pro bono work, which I feel is an important part of my work. It is extremely limited, but I’d be so interested in your comments about this.

[00:01:43] If there is a measure that you would use in terms of, how many clients you would only see for a certain amount, or how you think about it, how you gauge it. I hope that’s clear. Thank you so much for all the work that you do.

[00:01:59] Linzy: Margot, thank you so much for your question. And yeah, that does, uh, point out an interesting way in our, in our field that there’s two uses for the same word. The word scaling can refer to scaling up as I was talking about in the Feelings and Finances episode with our question from Edgar about growing your business and expanding what you do beyond that one on one.

[00:02:20] We call that scaling, but then there’s also sliding scale. So that’s what you’re talking about here is sliding, I think, is often the verb that we use to talk about this, which is where, as you said, we offer folks a lower fee. And what I’m hearing is in your practice, there’s maybe many folks on a lower fee.

[00:02:36] So there’s two pieces to this, Margot, that come to mind right away. The first one is knowing your numbers, right? So you mentioned this piece of, is there a certain amount of clients that we should have that we offer these kinds of spots to you? I’m hearing you also do pro bono work, right?

[00:02:52] So that is just work, you know, that is free. So, the answer is that no, there’s not a certain number for everybody, but there is a number for you. So the very first place that I would encourage you to start as you’re thinking about this sliding scale question is how much do you actually need to make to take care of your life?

[00:03:11] Right? To be well, to be able to eat the food that’s good for you, to be able to pay your mortgage, to be able to save for retirement, maybe save for kids’ education, or inheritance for grandchildren, you know, whatever your goals are. What does that number look like for you?It takes a little bit of work to find this number, Margot, because in that mix, we need to think about how much money needs to come in the door of your practice, right? So that you’re sending enough money home to you, and there’s also money to set aside for taxes, and there’s also some money to set aside for running your business, right?

[00:03:43] So the money that comes in the door for your business has many jobs to do. Not just paying you, not just paying to run the business, but it has multiple responsibilities. So, you know, there’s going to be a little bit of sitting down and being with your numbers. That’s really going to be helpful for you here to think about what does your paycheck need to look like?

[00:04:00] What is that number that feels good coming home that covers off your obligations and responsibilities, but also gives you some money to live and save for the future. What is that number for you? Is that 2, 500? Is it 4, 000? Is it 6, 000? That number is different for all of us, depending on our life circumstances, whether we’re in a dual earning household, needs of our family.

[00:04:22] Everybody’s life has its own profile. So that’s the first thing I would have you ground in is sit down and think about what do you need your paycheck to be after taxes? Then we need to think about how much taxes need to go aside for you to get that paycheck, right? What would be, the 30%, that you would add to that number to give you, so there’s enough money going aside for taxes, and

[00:04:42] to cover off the money that’s going home to you, so your tax obligation is covered. Then we need to think about how much money it takes to run your practice. So how many dollars a month do you spend just paying your rent or paying for courses, professional development, your software that you use in your practice?

[00:04:56] What is that monthly net? Is that like 500 bucks a month, a thousand bucks a month? You’re going to add that to the picture, too. So now we’ve got three numbers that we’ve grabbed so far. One is your paycheck to yourself, the taxes to cover off for that paycheck, and the money that you’re spending to run the business, right?

[00:05:11] We’re going to add all those numbers together. It’d be nice if there was also like a buffer there, Margot, you know, for like some vacation time for you and a little bit of profit, profit being just oxygen, breathing room. But let’s just say, you know, for the sake of, of simple, clear numbers that you come to the conclusion that your practice needs to bring in like 6, 000 a month

[00:05:31] to cover off all of those different things. Now we can think about how do you get there, right? And in Money Skills for Therapists, I have a tool that guides you in doing this because there’s a lot of moving parts here, but we’re going to talk it through so you can work these numbers out on paper, right,

[00:05:44] and be with these numbers for yourself. So using 6, 000 as the number that you’ve come to, to cover all those things, thinking about how many sessions a week are you able to work and be well? I think about this, Margot, as your sweet spot number. This is not your drop dead number. This is not like I can do 20 sessions a week, and then I go home and feel like a zombie and cry myself to sleep, and use the weekend to like just recover so I can start over again next week.

[00:06:12] This is the number of sessions where you feel you’re best, you’re doing your best work, you get in the zone, but you can also still go home and be present in your life, engage in some hobbies, still have enough energy left over for you and the folks who love you. So let’s say in this case 6, 000 a month, and you decide that your sweet spot number is 16 sessions a week.

[00:06:35] So I’m going to take the number 6, 000. I’m going to divide it by 16 and then I’m going to divide it by four. There’s actually 4. 33 weeks in a month, but I’m going to play a little bit conservative, which gives us a little bit of, of breathing room if folks can’t make it, or if you’re sick.

[00:06:48] So that gives an average fee of 93.75 an hour. These are made up numbers. You’re going to play with your own numbers. But when I have that number, then I can start to see, okay, based on the folks that I have in the mix now, am I making enough money to get me to that 6, 000 a month? And if I’m not, where can I start to wiggle so that I do get to that 6, 000 a month that I need to see?

[00:07:14] Do I have 12 people on sliding scale that are paying me somewhere between 30 and 60? Can I bring up the bottom of that sliding scale? You have so much opportunity here, Margot, to play with the numbers to make the practice reflect your values. There’s no one way to do it. You’re also doing pro bono work, so I would actually add that in as you’re thinking about your capacity, right?

[00:07:36] So, if your capacity is 16 clients, but you’re doing 2 pro bono sessions a week, that’s actually 14 sessions a week that you’re getting paid for. So now we need that 6, 000 to, coming out of 14 sessions a week. And when I do that, then the average needs to be 107 an hour, right? You need to make 107 on average between all your sessions.

[00:07:55] And then you can start to ground on the mix that you have now, is it getting you where you need to be? If it’s not, start to experiment with, well, what if? What if each week, I had five folks on sliding scale who are each paying me $75, and just add these numbers together. So if I take five folks on sliding scale and they’re each at $75, and then the remainder of my folks, let’s say another nine people, because I’m playing with this imaginary 14, are on my full fee, which I’m going to say is 150,

[00:08:25] what does that get me to? If I do five times 75 plus nine times 150. Okay, that’s getting me to 1,725 a week, so that actually does get me to a number that’s getting me to that 6, 000. I’m just playing, right? And this is so important, Margot, as you’re figuring out the right mix for you that reflects your values and the folks that you love to serve, and your own financial needs, is be curious and play.

[00:08:52] Just do a little math. Right. This is all just, uh, it’s elementary school math, right? We’re talking about addition, subtraction, multiplication. So play with the numbers to see like, what would be a really nice mix that hits a couple sweet spots? It hits your amount of sessions that you can work for a week and still thrive.

[00:09:08] Be a happy human. That’s your sweet spot. It allows you to serve enough folks in your practice that you feel like you are contributing to your community in the way that you want to, or you’re able to serve the folks that you love to serve, who maybe could not access you at your full fee,

[00:09:22] and it’s getting you the money that you need to live and be well, right? So there’s like these three elements here that we are balancing that you get to play with and do a gut check on what makes sense. Once you determine what your sliding scale needs to look like, then you get to set boundaries around it.

[00:09:38] And this is the second part of my response to you. So once you determine, okay, I have three sliding scale spots available in my practice. And those are already taken. I already have three folks that I love who I’ve been working with for a long time. Those spots are taken. They’re not going anywhere anytime soon.

[00:09:53] I’m happy to work with these folks long term. Then you know that you don’t have any more sliding scale spots available. You’ve set a boundary for yourself. Now it’s about holding that boundary. And There was an episode that I did a few seasons ago with Brittany Kipnis, she’s a graduate of Money Skills for Therapists, and we had a conversation about this, about holding that boundary when you’re telling a client your fee.

[00:10:14] Because it’s exactly like you say. We start to, you know, tell a client our fee, and then we start to do some mind reading for them. We project onto them what we’re feeling, so we say, my fee is 150, and before they even have a chance to react in any way, we say, but I do have a sliding scale. Right? We’re not even giving them a chance to say, Oh, that’s fine.

[00:10:33] Or to say, Oh, okay, yeah, just let me talk to my mom because she said she would help me with therapy. You’re not even giving them a chance to solve their own problem when you are jumping in and assuming that they can’t afford your fee. So the strategy for this is say your fee, my fee is 150 an hour, and then stop talking.

[00:10:51] We need to give them space. We need to give them space to process, to respond, to let you know that they’re going to think about it or to say, Oh, that’s totally fine. My last therapist was 175 an hour. This is no big deal, right? We need to let them be the adult. And if there is a problem, we need to let them solve their own problem as an adult and not take that problem on as our own.

[00:11:14] If you have a hard time doing this, there can be some different tricks to help you hold that boundary. One that I find can work for parents is imagine taking that money that you are offering them out of the hands of your child and giving it to them instead. So if you are 150 a session, but you’re going to about to offer them a 75 sliding scale, imagine taking 75 from your own child and giving it to this client instead, because that’s functionally what you’re doing.

[00:11:38] You’re taking money from your own family and giving it to somebody else, which you can do sometimes, right? But if you’re doing it all the time, you really are depriving your own family and setting it up so their needs are not being met so that somebody else can have their needs met or be extra comfortable or not have to solve their own problem.

[00:11:54] So these are the two parts of my response. One, take that time to ground on your numbers, play with your numbers as we’ve talked about here. Two, once you have set that boundary, it might also be adjusting your caseload to start to have some folks who are on sliding scale wrap up with you if they’ve been with you a while to get you down to the number that’s sustainable.

[00:12:13] And then hold that boundary when you are having conversations so that you actually set up a practice that is sustainable for you. That takes care of you, that pays you, has you working an amount of sessions. That has you in your sweet spot enjoying your life. Right, so clarity and then boundaries. Those are the two parts to my advice for you, Margot, on sliding scale.

[00:12:32] I wish you clarity and groundedness. If people are watching YouTube, they’ll see that I’m doing a grounded motion in this piece. It can be a really tricky one, but once you get clarity around it, you are going to find that so many things in your practice and your life get easier.

[00:12:47] Thanks so much for your question, Margot If you, like Margot have a question that you’d like me to answer on a Feelings and Finances episode of the Money Skills for Therapists podcast, it is super easy. Just follow the link in the show notes. It’ll take you to our podcast page where you can just press record, leave me your question, just like Margot Share your name, share your question, and I would be happy to answer it on a future episode of Feelings and Finances.

[00:13:10] Thank you so much for joining me today.