How Much Should You Charge As A Freelancer?

The answer isn’t simple…

Your freelance rates need to be high enough to give you the lifestyle you want, but low enough that clients will work with you. You also need to consider what your goals are, what your expenses are, and how much time a project will take you.

Don’t know where to start? Worry not! We have put together a handy guide to help you figure out how much you should charge as a freelancer. This guide is based on industry research, data from our own community of freelance writers and editors, and lots of discussions with experienced freelancers.

Ready to get started? Let’s dive in!

Here are some things you should consider:

How Much To Charge As A Freelancer

Takeaways
1. Understand your worth: Evaluate your skills, experience, and the value you bring to clients when determining your rates.
2. Research industry standards: Research the average rates in your industry and location to ensure your pricing is competitive.
3. Consider your expenses: Account for overhead costs, taxes, and other business expenses when setting your rates.
4. Customize pricing for each project: Consider project scope, complexity, and client requirements to determine a fair and accurate price.
5. Regularly review and adjust rates: As you gain more experience and expertise, periodically evaluate and raise your rates to reflect your value.

Table of Contents

1. How Much The Client Can Afford

Before pitching a potential client, do your research! Take a look at their website and social media pages, and see what they’ve been posting about recently. If they’ve posted a bunch of job listings recently, this could be a sign that they’re having trouble bringing in business.

If that’s the case, their budget for freelancers is probably pretty low, and you might want to lower your rate accordingly. On the other hand, if they’ve been posting about successful projects or have been growing their team lately, it may be a good idea to pitch on the higher end of your price range.

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2. How Much The Client Is Willing To Pay

You’ll need to do some research and determine how much the client is willing to pay for your services. You can do this by comparing your services to those of other freelancers in your area and online. Consider the experience of freelancers who are similar to you and their rates, as well as the types of clients they are able to attract. Try to get a clear idea about how much a client would be willing to pay for someone like you.

3. Consider How Long It Takes You To Complete Each Task Or Project

If you’re a freelance writer, do some practice writing pieces and see how long they take you to write. Consider if writing is something that will come easier or harder with practice. If it will get easier, consider charging less at first to gain experience. Once you know how long it takes you to write articles, set your rates accordingly, choosing a price that reflects the hours you’ve put into the work and leaves enough for overall profit.

4. The Value You Bring To The Project

It’s important to consider the value you bring to the project, and how that will benefit the client. That should be one of your main considerations, and it can help you figure out how much to charge — especially if you’re just starting out. You should also consider what you need to make per hour in order for freelancing to be worth it for you and be sure that your rates reflect that.

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5. The Quality Of Your Portfolio

How many years have you been in this business? If you’re just starting out and have no portfolio to show for it, then it’s probably best to lower your rates at first. You want to gain experience and build a portfolio so you can eventually demand higher pay.

6. What Kind Of Freelancer Are You?

If you’re ghostwriting novels or articles, then it’s probably best to get paid per word count. If you’re a web designer who is building an entire website from scratch, then it’s best to get paid per project. If you’re a copywriter who is working on specific projects, then an hourly rate would be appropriate.

7. Long-Term Vs Short-Term Project

If you’re looking at a potentially long-term relationship, you’re going to be more inclined to work within the client’s budget, even if that means lowering your rates. On the other hand, if it’s a one-time gig and you know that your client has a generous budget, you can start by charging top dollar and see how they react. You might be surprised!

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8. Your Competitor’s Rates

In either case, it’s always a good idea to have an idea of what your competitors are charging — just so you know what kind of rates people will pay. In order to find out this information, try asking other freelancers in chat rooms or discussion boards about what they are charging for similar work.

You could also check freelance websites such as Upwork and Guru for other freelancers’ profiles and rates. However, remember that information gained on these sites is often unreliable and outdated — so don’t treat it as gospel truth.

How To Determine Your Freelance Hourly Rate?

Option 1: Determine your annual salary goal and divide by the number of billable hours you plan to work each year.

(Annual Salary / 2080 working Hours per year) = Hourly Rate

For example, if your annual salary goal is $40,000, your hourly rate would be $19.23 (40,000/2080). This number is going to be used in your freelance contracts as your base hourly rate for all of your clients.

Option 2: Calculate your hourly rate by determining how much you need to earn each month, dividing that by the number of billable hours you will work each month, and multiplying by 12 (months) to get your annual rate.

For example, if you want to make $60,000 next year and plan to work 2000 billable hours (50 weeks x 40 hours), your hourly rate is $60,000/2,000 = $30 per hour.

If your monthly salary goal is $5,000 and you plan on working 160 billable hours per month (40 hours x 4 weeks), your hourly rate is ($5,000 x 12)/(160 x 12) = $31.25 per hour.

When Should A Freelancer Raise Its Prices?

Freelancers have the freedom to set their own prices, but many don’t know when to raise their fees.

You Should Consider A Price Increase When

1. Your Business Is Growing

If your business is growing, that’s a good sign. But it also means you need to raise your prices. It’s not just about charging what the market will bear. If you want to make a living out of freelancing, you have to charge enough to cover your expenses and give yourself a living wage. That means raising your prices as your business grows.

2. You’re Working Longer Hours Than You Originally Projected

This happens when your workload gets heavier or clients start demanding more revisions or last-minute changes. If you’ve found yourself spending more time on each assignment than you did before, it may be time to increase your rates.

If a client balks at paying more for the same work, offer them an incentive for renewing their contract with you: waive a fee for services that aren’t time-intensive, such as using their logo for future projects or helping them with website maintenance issues. This can help keep the client happy and reduce the amount of time you spend on nonbillable tasks.

3. It Has Been A Year Or More Since Your Last Price Increase

If you are working with the same clients year after year, ask yourself if they are still happy with the price they are paying for your services. It is possible that the amount of work you do for them has changed over time, or that their needs have evolved. You may wish to give them a new rate reflecting the value of your work and services provided over time.

4. You’ve Become More Experienced And Skilled

The more valuable your services will be to potential clients. This means that they’ll be willing to pay you more for the same service now than they may have been before.

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5. You’re Having Difficulty Keeping Up With The Demand For Your Services

If you’re juggling multiple clients and running up against deadlines, you might be able to handle the workload if you increased your rates. This is a good sign that you’re charging too little because the demand for your services is greater than what you can provide (and suggests that people are willing to pay more).

6. You’ve Grown Your Client Base

The more clients you have (assuming they’re happy enough to pay for your services), the more comfortable you should be with raising your rates. You’ll likely have some regular clients who came on board at a lower price point, so consider giving them the option of continuing with a lower rate or paying at the new rate. If they choose the latter, make sure they know how much of an investment you’re making in their project by doing so.

7. Your Expenses Have Gone Up

You may have started out freelancing from home without any overhead, but as your business grows, you might need to rent office space or hire help. Those costs will have to be covered by higher rates for your clients.

How Should You Ask Your Client To Raise Your Rates?

Don’t be afraid to ask!

If you don’t feel comfortable asking directly, why do you think your clients should? If they can’t afford your rates, that’s one thing — but don’t assume the worst until it happens.

Remember that clients always want the best people for their projects. That means that if they hire you and your price is reasonable, they will pay you because they want what you offer.

Here’s A Sample Email You Can Use To Request A Raise From A Client:

Hi [name]

I wanted to touch base with you about the rate you’re paying me for my work. You’ve been a great client, and I appreciate your business.

In order to stay profitable, though, I need to increase my rates. My current contract charges $*rate*, but I’d like to raise that to $*new Rate*.

I’m confident I can continue providing the same quality of work and meeting my deadlines. Let me know if there’s anything I can do to help make this change happen.

Best,

Costantine.

But What Happens When People Aren’t Willing To Pay Your Rate?

Then you need to lower your rates until they are willing to pay them or until you reach the minimum amount of money you’re willing to accept for the work. This is an important distinction because we all have different needs.

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Final Thoughts

As you can see, determining your hourly rate is a pretty complicated thing. Each stage has its own pros and cons for charging less or more, and the information we turned up was all over the place! So it’s really up to you to decide what you want to do with your freelance career. You should also remember that rates change, and it’s best to start high and then decrease if need be. Hopefully, this helps you make an informed decision. Good luck!

FAQs

Here are some frequently asked questions about freelancer pricing:

How do I determine my freelance rates?

Determining your freelance rates depends on various factors such as your skills, experience, industry standards, and the value you bring to clients. Consider factors like your desired income, project complexity, time commitment, and market demand to set competitive rates.

Should I charge hourly or project-based rates?

The choice between hourly and project-based rates depends on the nature of your work and client preferences. Hourly rates are suitable for tasks with uncertain timeframes, while project-based rates offer more clarity and can be advantageous for fixed-scope projects.

How can I ensure my rates are competitive?

To ensure your rates are competitive, research industry benchmarks and analyze the rates charged by other freelancers in your field. Consider your skills, experience, and the value you provide to clients when determining your rates.

How should I handle rate negotiations with clients?

When negotiating rates with clients, clearly communicate the value you bring to the project and justify your pricing based on your expertise and the deliverables you will provide. Be open to discussions and consider potential compromises while maintaining a fair pricing structure.

Should I raise my rates over time?

Raising your rates over time is a common practice as you gain more experience, expertise, and reputation in your field. Regularly evaluate your rates and adjust them to reflect your growing skillset and the market value of your services.

Costantine Edward

Costantine Edward is a digital marketing expert, freelance writer, and entrepreneur who helps people attain financial freedom. I’ve been working in marketing since I was 18 years old and have managed to build a successful career doing what I love.