Dietitian Private Practice Salary: Paying Yourself as a Business Owner
How much should you pay yourself as a dietitian business owner?
To understand how much you need to make in business in order to pay yourself well, reverse engineer your business strategy to give you the life you want.
In today’s blog, we’ll talk about what you should charge for your services, the Profit First method, stages of business, data analysis, and so much more.
What Should You Charge in Private Practice?
I hear a similar story all the time…
A dietitian starts a private practice on the side, hoping to grow and expand someday, but will settle for a few clients at the beginning. Let’s call this person Jennifer, because hey– this was my situation back in 2011! Jennifer doesn’t want to rock the boat and feels a little self-conscious about business in general, so she chooses to charge a lower fee when she starts her business.
Fast forward six months, and things are working out!! Slowly, Jennifer is building her business and reassessing her business strategy. She currently charges $100 for an initial and $75 for a 45 follow-up visit. She has 10 clients/week. But she has about $2000/month of business expenses.
Let’s play with some math examples. On average, if Jennifer is making $3,000 in revenue each month in private practice ($750 x 4 weeks in the month) and about $2,000/month in business expenses, her profit is $1000/month. And then she will pay taxes!! This leaves her with maybe $750/month in take-home pay….
Meanwhile, if she charges $125 for a follow-up session, that’s $5,000 of revenue each month ($1250 each week x 4 weeks in the month) with the same business expenses, and YES! $3,000 of profit each month. She still pays taxes though, so this doesn’t really get her too excited yet.
She decides to experiment with $175 for a follow-up session. $175 for a follow-up session, that’s $7,000 of revenue each month ($1750 each week x 4 weeks in the month) with the same business expenses, she’s making $5,000/month with room to see more clients for more money.
When it comes to your dietitian private practice salary, you have to look at your income, your expenses, and decide on a rate that aligns with your goals.
Profit First & Prioritization
One of my favorite finance books is Profit First For Therapists by Julie Herres.
She talks about prioritizing profit and being intentional about financial management, especially when you lead a team of clinicians. This approach can lead to a transformation in the way a business operates.
The Profit First method in general is about paying yourself first as a business owner instead of paying yourself what’s left after you’ve paid all your expenses.
It’s a simple method, but it’s so powerful.
Stages of Business
Every stage of business has its own recommendations for finances.
Solopreneurs, small group practices, and large group practices have varying approaches to paying themselves and managing their businesses. Julie talks a lot about this in her book, Profit First For Therapists.
Understanding these stages and their financial needs is crucial.
- Solopreneur Stage: Owners typically take home 30-60% of the revenue generated in the practice, considering taxes and profit allocations.
- Small Group Practice Stage: Owners may take home 10-30% of the revenue, as a significant portion is allocated to paying clinicians and managing overhead costs.
- Medium Group Practice Stage: Owners experience a shift in responsibilities, focusing on creating systems and outsourcing services to sustain business growth.
- Large Group Practice Stage: Owners at this stage aim for a total of 20-25% of revenue allocated to tax, profit, and owner’s pay, with an additional allocation for leadership.
Paying Yourself as a Business Owner
When talking about business mindset, it’s important to understand some business financial terms and areas of confusion. One of the most common questions I receive is W2 pay vs. owner withdrawal, and taxes.
- W2 Pay: Pay yourself through payroll, accounting for all taxes needed as an employee of the business.
- Owner Withdrawl: Transfer or deposit a certain amount of money into your personal account from your business account.
- Taxes: The money you pay to the government: federal taxes, local taxes, Medicare taxes, Social Security taxes, and more.
Now, I’m going to break it down by the stage of business that you’re in.
SET UP/START/GROW:
- Usually taxed as a sole proprietor *even if the business is officially an LLC or PLLC
- Take owner withdrawal from the business to your personal account
GROW/SCALE:
- If you’re making over *70-80k profit: Usually taxed as S Corp, but this is a question for an accountant.
- Take W2 pay as an employee of the business and the owner withdraws from the business to receive tax breaks
Here are some more definitions to help you understand how all of this works:
- Sole Proprietor Taxes: “The Business” aka the business owner pays taxes.
- S Corp or Corp Taxes: “The Business” pays taxes AND the business owner pays taxes as a W2 employee so the business can receive tax benefits.
When you pay taxes, you should set up estimated tax payments each quarter and/or pay your taxes at the end of the year.
Now let’s talk about how to pay yourself. There are different ways to do it, and you have to find what works for you. Here are some examples:
- Weekly Deposit: Every week, transfer money to your personal account.
- Monthly Deposit: Every month, transfer money to your personal account.
- Quarterly Deposit: Every quarter, transfer money to your personal account.
As you’re making these transfers, record them in your bookkeeping. As you can see, there’s a lot that goes into paying yourself. It’s important that you meet with an accountant to ensure you fully understand your business finances.
Raising Prices
Your pricing can directly impact the financial health of your business.
As dietitians and health care professionals, our prices should reflect the value we bring to clients, the change and impact we create in the world, and take into consideration what the market will pay for.
Pricing is highly nuanced and individual for dietitian business owners. Pricing depends on your location, your market, your ideal client, and your offer. But pricing also depends on your experience, your boundaries, and your ability to declare an amount that is perfect for YOU and your business. Each dietitian will have to assess their own situation to find out what price feels comfortable for them.
So how do you know when it’s time to raise prices?
When you do the math and look at your business income and expenses from an objective point of view. If you are in business for yourself and not making enough money to support yourself, your business will not last long-term. Financial health is only one aspect of business strategy, but it’s a very important part of business success.
When you know in your gut it’s time for a price increase. If you’re feeling any kind of resentment toward a lower fee, chances are you will not be the best counselor for your clients. Resentment builds, whether it’s conscious or not!
When the market allows for a price increase. If other dietitians are charging a higher rate in your area and are getting clients, that likely means your ideal client is able to pay a higher rate.
Raising rates is difficult because we care about clients. The entire world is struggling right now and we’re not immune to that. But you deserve to take up space and declare prices that are within your boundaries.
I have 3 tips for creating financial systems to help you make more money in order to pay yourself well.
- LOOK at your finances and review them. Creating a detailed spreadsheet is the best skill that I developed as a business owner. (And yes, I give this away in my programs!) But this work is not easy– looking at money brings up so much for us and the “skill” in it is to look at data, understand emotion, and then make the financial decisions that are best at the time.
- Know your target goals and what the market will pay for. Your target goals will come from the spreadsheet, and “what the market will pay for” will come from research. Google what your client is looking for and see how much programs cost. Look at other providers in your area and see what they are charging. My favorite exercise is to ask your audience how much money they’ve spent trying to (insert their problem). As a weight-inclusive provider, it was heartbreaking to realize how much money my clients spent on dieting, but it was the fuel for me to realize they should spend that money in a private practice that actually helps them heal.
- Know your own personal triggers and how to work through them so you can show up and serve your clients. Do you get triggered when a client no-shows and therefore don’t charge your cancellation policy? Do you have way too many sliding scale spots and therefore aren’t profitable? Do you pay your team too much? That last one is so common, so don’t worry, you’re not alone. But my goal is that you pay your team well AND you take home a lot of money too.
I not only teach pricing boundaries, but I practice what I preach. As I provide more value to my clients, see more transformation with coaching, and add more tools and templates, I increase the price Business School. Price increases are HARD for me. But I know I need to honor my boundaries to show up best for my clients.
Dietitian Private Practice Salary: The Takeaway
It can be hard to know how much to charge and pay yourself as a dietitian.
By understanding your stage of business, your niche, adapting, investing in yourself, and how to raise your rates, you can feel confident in your rates as a dietitian and pay yourself first.
Pricing is nuanced, so you’ll have to do the work to decide on what feels right for you and what meets your goals.
Want to work with me to build your private practice?
Business School is a comprehensive 6-month program designed to guide you through every stage of building a private practice: getting set up, seeing your first clients, growing until you’re fully booked, hiring a team, expanding your offers—and even learning how to coast when needed. Inside, you’ll follow a step-by-step curriculum with the flexibility to choose the path that fits your current stage of business and life. You’ll get access to advanced toolkits, templates, and systems for business topics like marketing and finances, but also for counseling skills and client support. Beyond the curriculum, you’re supported by personalized 1:1 coaching, weekly office hours, and monthly themes that address the real challenges of private practice. The program keeps you moving forward with built-in accountability that builds resilience and confidence so you feel like a legit business owner. Learn more and apply here!
