Pricing is the question every freelancer fights with. Charge too little and you burn out. Charge too much and the phone goes quiet. There is no magic number, but there are three clear models, and a simple way to work out which one suits each job.
Model 1: hourly rate
You charge for the time you spend. It is simple and fair when the scope is unclear, when the client keeps changing their mind, or when you are doing ongoing support.
- Good: easy to explain, protects you from open-ended work.
- Bad: it punishes you for getting faster, and clients may watch the clock.
Model 2: fixed project price
You quote one price for a defined result. It is what most clients prefer, because they know the cost upfront.
- Good: you are rewarded for efficiency, and the client can budget.
- Bad: risky if the scope is vague. You need a written list of what is and is not included.
Model 3: value-based price
You price against the result for the client rather than your time. A landing page that brings a business thousands in sales is worth more than a page that is just a nice picture.
- Good: highest earning potential, positions you as a partner.
- Bad: needs confidence, and an understanding of the client's business.
Work out your minimum hourly rate
Start with a floor you cannot go below. A simple way to estimate it:
- Decide the yearly income you need after tax to live on.
- Add a share for tax and business costs such as software, equipment and training.
- Divide by the number of hours you can realistically bill. This is far lower than a full-time job, because admin, marketing and gaps take time. Many freelancers can bill only a part of their working week.
Example. You need $30,000 a year after tax. With tax and costs the target becomes about $40,000. If you can bill 25 hours a week for 46 weeks, that is 1,150 hours. $40,000 ÷ 1,150 is roughly $35 an hour as the minimum, before any profit or buffer.
Turn hours into a fixed price
Estimate the hours for each deliverable, add a buffer of 20 to 30 percent for revisions and surprises, then multiply by your rate. Round it to a clean number. If you are unsure, split the project into phases and quote one phase at a time.
Signals that you are priced too low
- Almost every quote is accepted immediately.
- You feel resentful while doing the work.
- You can never take a week off.
- Clients treat the work as disposable.
How to raise your rates
- Raise prices for new clients first. It is the easiest way to test.
- Give existing clients notice, usually a month or more, and a short reason.
- Add value instead of only a higher number: faster turnaround, a clear process, extra deliverables.
- Review your rates at least once a year.
Handling "that is too expensive"
Do not discount straight away. Ask what they were expecting, and offer to reduce the scope instead of the rate. "I can do the homepage and two pages for this budget, and add the rest later" keeps your price intact and gives the client a real choice.
Put it in writing
Whatever model you choose, send a clear quotation with the price, what it covers, and the terms. It turns a price into a professional offer.
Try the free quotation generator on this site to turn your price into a clean, itemised quote.
Make your next one in minutes.
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