Setting Lesson Fees

by John M. Zeigler, Ph.D.
Rio Rancho, NM USA

iano teachers don't make much, but, in a certain, limited, sense, it's partially their fault! Now that I've gotten both the attention and ire of piano teachers, let me explain why. If you feel you're already making too much money as a piano teacher, just skip the remainder of this article and enjoy the rest of the site!

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Piano teachers should NEVER undervalue their services.

Who Sets the Lesson Fee, Anyway?

Any teacher can cite another teacher or teachers in their area who offer lessons at seemingly unrealistically low prices. Perhaps those teachers don't teach as their primary source of income and don't need the money; perhaps they just don't know what they are really worth. As a result, you and other teachers in the area may feel that you have to keep your own rates low to "compete." Chances are that you'll have a very difficult time persuading those teachers to raise their rates to more reasonable levels so that you can raise yours. Should your lesson fee then be based on the judgment of others or should it be based on the quality of your teaching? I think the answer to that question has to be the latter for most teachers.

I have said numerous times on the site that piano teachers should never undervalue their services. Generally speaking, I suggest that teachers find out what the average prevailing rate is in their area and use that as a base price. Additional increments should be added to that for additional services and capabilities offered by the studio (performance opportunities, computer lab, competition participation, etc) over and above those offered by other teachers in the area. Note that these should be added to the base price for all students, regardless of whether an individual student avails himself of any or all of the services, since it takes time and effort to make them available at all. Greater education and experience should also be factored into your fees. To illustrate some of these points, allow me to give a real life example.

A Real-Life Case Study

One of my piano teacher friend's rates were way too low - so low that she wasn't making anything like a living wage from teaching. I strongly advised her to start raising her fees, based on the "extras" she provided her students (performance and competition options, computer lab, studio concerts, etc.). I advised her to "sell" herself as a teacher who provided the "best" in lessons (which was, indeed, true) and market the studio the same way. In the space of three years, she more than doubled her fees, even though the "cheap" teachers in her area kept theirs the same, for a while. She went from being one of the most inexpensive teachers in the area to one of the most expensive.

Was she able to compete? You bet. She had a drop in studio numbers (about 15%), but had more than doubled her rates so she came out way ahead. Moreover, those students who left the studio tended to be the least serious ones, while the best ones stayed. The drop in numbers meant that she had more time, both for students and her own professional development.

Similarly, she was able to recruit better quality students with the higher rates than with the lower ones. Those who were willing to pay to get the best teacher possible seemingly did so because they cared the most about lessons. Wealth has nothing to do with it. The key factor driving this increase in student quality is commitment. A willingness to pay a higher fee to get the best teaching is one indicator of commitment to lessons.

Looking at this experience, we can see that there was a very real sense in which the teacher had been responsible for the low remuneration she had been getting. She just wasn't charging enough! A side benefit was that other teachers in the area then felt they could raise their rates, once hers went up. Eventually, even the "cheaper" teachers did, making her higher rates even more competitive.

Are Your Fees Too Low?

While every detail of this example may not apply in your area, it does show that raising your lesson fees to more reasonable levels can have positive effects, beyond the obvious ones. So, how do you know if your lesson fees (and those of others in your area) are too low? One way to tell is to look at enrollment in your studio and others in your area. If your studio and others in your area are full with waiting lists, as is often the case, then, by definition, the rates in your area are too low! The market forces are demanding that rates go up to balance demand for lessons. In an ideal "free" market, the price is set at that point at which supply (teachers' time) exactly balances demand (for lessons). That's basic economic theory. It may leave some of us cold to think of it that way, but it reflects the reality of supply and demand in a free market.

Of course, there are exceptions to that: there are genuinely well-motivated people who FEEL they can't afford a higher rate. If you want to take a few students in that situation, don't lower your fees for those individuals (the word will get around). You can work out a payment in kind arrangement for home repairs, yard work or anything else you need done in exchange for a PART of the lesson fee. Experience shows that people treat the lessons as free if you barter the whole lesson fee - and often don't do any of the bartered work.

If this analysis seems a little unfeeling, then consider this: each time you turn away a student because your studio is full, you are, in effect, making a decision to keep that fraction of your students who care more about your lesson fees than they do about their lessons - at the expense of some who might be more motivated or at least more understanding of the fact that you need to make a living wage in order to continue teaching. Note that I'm not suggesting that piano teaching should become like a "welfare state" where a living wage is an "entitlement." Rather, I'm saying that, if studios are full in your area and you (and other teachers) can't make a reasonable income, you and they will eventually leave the profession and the shortage of qualified teachers in your area will only become worse. Nobody benefits from that scenario.

Strategies

One good way to deal with increasing your rates to a more realistic amount is to raise your rates slowly but steadily, making sure that they stay within the local range of rates but are on the upper end of them. As a competent and dedicated teacher, you can easily justify being in the upper end of the range. As you raise your rates, other teachers will eventually do so, too. From everything I've seen and heard from teachers over the years, it just doesn't work out, or make much sense, to be on the low end of the fee range. If you're at $15 per half hour lesson now, you might consider going to $20 next semester and to $25 after a couple more and so forth, or whatever strategy makes most sense to you. It may take you a couple years to get to the fee structure you want, but at a minimum, you'll keep up with or even gain a little on inflation.

Of course, the devil is always in the details. If you're in a low rate area, you may not be able to get your fee up all at once. You have to think through carefully how you will justify the rates - not in terms of the rates others charge, which, after all, you don't determine, but why you charge what you do. Other teachers may initially try to use your higher rates to bring students into their studios at your expense - as they are entitled to do. Be prepared for a drop in numbers, but if you make more money in the end, that won't matter. The positive side of that is that you then have enough time free that you can encourage your best students to take hour long lessons instead of half hour lessons. They will benefit and you will enjoy teaching them more.

Some potential clients may ask why your fees are higher than other teachers, if you increase them. The best response to that question is often something along the lines of "I pride myself in providing the very best teaching possible. That requires a great deal of my time beyond that charged for the lessons themselves. I believe my rate reflects both the quality of and my commitment to teaching." That argument will not convince those who only want the cheapest possible teaching, but, then again, do you really want to teach people who come into your studio with that attitude? One thing is certain: if you don't believe that you should be appropriately remunerated for your time, your students surely won't.

Some teachers may feel that they can't charge a fee "higher" than the hourly salaries of some of their students or students' parents. However, most people work for others. Their "true" salary is not their hourly pay, but the "fully loaded" salary, i.e. the salary plus the cost of benefits (health insurance, workman's compensation, overhead, etc.) and taxes (Social Security) paid by the employer. These can double or triple the true cost of the employee to the employer. On the other hand, most piano teachers are self-employed. They must pay the costs of benefits and taxes that other people's employers pay. Seen in that light, a teacher's hourly fee seems much less unrealistic.

To Discount or Not to Discount

Many teachers offer "discounts" for multiple students in a household, pre-payment or as incentives to persuade people to take less desirable lesson slots, though such a practice is, by no means, universal. The concept of a discount in a professional setting like teaching seems out of place in a sense. After all, do you offer a lower quality of lesson to the persons who receive the discounts? Generally speaking, it is best to offer the discount as a part of a pre-defined policy, rather than in response to a demand from a potential client. If you offer discounts on an ad hoc basis, the word will get around and soon you'll be facing multiple demands for discounts from other clients. By having a discounting policy already defined (e.g. no discounting, for prepayment of a semester's worth of non-refundable lesson fees, or for taking non-prime lesson times), you have an answer for those who insist on a discount. However, that way you can offer it to everybody, not just those pushy enough to demand it.

Necessary vs. Discretionary

If you still feel bad about increasing your fees to a more livable level, then consider this: Why should people be willing to pay a golf or tennis pro anywhere from $75 to $300 per hour for private golf or tennis lessons, but object to private piano lesson fees? Why should they be willing to spend a $100 a month on a cell phone for their kids to carry, but not on piano lessons? Why do people spend the time and money that they do to have their kids participate in sports? Why should they be willing to spend the hundreds of dollars a year it costs to be a member of a health club, but not be willing to pay a reasonable price for piano lessons? None of these are any more "necessary" than piano lessons, but many of the same people who won't think twice about spending money in these other ways, will complain about lesson costs, irrespective of the price. It's not that people can't afford lessons, even at a higher price, it's that some of them don't value the lessons highly enough. That fact begs the question: If some people don't care much about lessons, are they likely to be successful as students?

The bottom line is: if you feel you don't make enough money from teaching piano, take a careful look at why your income is so low. It might be that you are undervaluing both yourself and the commitment of your students!