Set Coaching Fees Using the Integrity Approach

Because there are no industry standards, setting coaching fees can feel like taking a stab in the dark. Are your coaching fees setting you up for success?

You may think that lower fees will get more coaching clients. They don’t. In fact, lower fees create a perception of lower value. Remember all that you’re bringing to the table and use the Integrity Approach to set smart coaching fees. Take into account both business and intuitive sensibilities, to set fees that support your financial goals and attract more invested clients as well.

There are two parts to the Integrity Approach: Do the Math and Listen for the Number. Use them together for a balanced perspective.

Do the Math

Take a “snapshot” of the relationship between the time you invest in your business and the income your business pays you. Time breaks down into billable and non-billable hours.

Billable time = time spent for which fees are paid.
Non-billable time = time spent for which no fees are paid, including:

  • Marketing (unless your marketing pays you)
  • Business development (your training, planning and innovation)
  • Free coaching sessions (sample sessions or consults)
  • Managing client records, billing & administration
  • Travel for work

Use this step-by-step guide to determine your minimum hourly rate and monthly coaching retainer. I’ve provided an example.

STEP ONE: Calculate your gross revenue target by adding together your desired income and your estimated expenses.

Desired pre-tax income: $75,000 + Estimated business expense: $15,000
= Gross revenue target: $90,000

STEP TWO: Decide how many clients you can handle and estimate the non-billable hours. If you’re not certain how many non-billable hours you’ll spend on your business, estimate based on what you know now. As you gain more knowledge, re-calculate. Over time, you’ll become more efficient at both attracting and managing clients.

Number of clients: 15
Billable hours per week: 15
Non-billable hours per week: 25

STEP THREE: Calculate the billable hours per year, allowing for vacation time.

15 hours x 48 weeks = 720

STEP FOUR: Calculate your minimum hourly rate by dividing your gross revenue target by total billable hours. As you add in other coaching revenue streams, such as workshops, teleclasses, or group coaching, your minimum hourly rate gives you the baseline for what you will charge for those services as well.

$90,000 divided by 720 = $125/hr

STEP FIVE: Calculate your minimum monthly coaching retainer by multiplying your minimum hourly rate by the number of billable hours per month per client.  (To make this easy, I’ve based the amount of monthly time on three one-hour coaching sessions plus one additional client contact hour = 4 hours per month.)

$125 x 4 hours per month = $500/mo

Sound high? It’s not. This exercise can be eye opening the first time through. You might realize that you need to:

  • Raise your monthly retainer for 1:1 coaching, which should be at a premium.
  • Add lower-cost services, such as group coaching, that still cover your minimum hourly rate.

You may want fewer clients, shorter or more sessions. Do the math for your preferences now.

Listen for the Number

Doing the math has given you a practical understanding of how your coaching fee relates to your income goal, costs of doing business, and time with clients. Now check in with your intuition.

  • Let go of assumptions about what your clients will pay. You do not know.
  • Clear your mind of any attachment to outcome.
  • Release any fears or concerns.
  • Trust that you are enough and that your services are valuable.
  • Then, ask yourself this question, and listen for the number that comes to you:

For my highest good, what is the best monthly retainer fee for my coaching?

What is the number you heard first? Hold that amount lightly as if you’re holding a butterfly in the palm of your hand. Will that number give you the income you desire?

Set your fees from a place of prosperity, leading with belief in the high value of your services. Then stick with those fees until it’s time to raise them. This will serve you and your clients.

LIKE THIS POST?

Subscribe to blog (it’s free) and also get your copy of 5 Secrets to a Highly Profitable Niche You'll Love

  • WOW, Rhonda!

    This really puts things into perspective. I was already charging $500(will double it by next year) but seeing the calculations this way, gives charging these fees gives me a sense of spaciousness around doing so.

    Thank you!

    Greg

    Greg’s last blog post..Are your words helping you become more Relationship Attractive?

    • Smart of you, Greg, to charge well at the get go. And I love your prosperity thinking that you’ll double it next year!

  • To paraphrase Paul, I’ve been rich and I’ve been poor. I’m thinking of trying an honor system fee structure. 3 options and you choose the one which you can most comfortably pay. I set my low-end at sufficient and my high-end at ideal.