Use your hourly rate

How should I be using my hourly rate? 

We’ve identified an hourly rate that works for you — great! What now? 

Your hourly rate is a starting point when talking to a prospective client about pricing. As with anything, communication is key here. Clients are coming to you for your expertise, and have their own goals and perceptions of how much to pay for a given service. It’s important to approach any pricing conversation with a “win-win” mindset — the client wants to hire you, and you want to work with the client!

Pricing conversations should leave both parties feeling good and excited to work together. During any conversation about rates, make sure you understand:‍

• Your client’s goals

• How your work fit into the overall mission

• What deliverables are expected 

• Deadlines and timelines

The client may ask what your rates are or they may already have a budget for the project. Either way, you should come into the conversation with three numbers in mind.

1. A reach rate. This is the rate you can start with and negotiate down from.

2. A rate you’re happy with.

3. A minimum rate. This is your “walk away” number that you will not dip below.

By starting with your reach rate, you can see if it fits within your client’s budget. If they are good with that rate, that’s great for you! If they need to negotiate down, then you have wiggle room. The minimum rate keeps you from taking on clients that won’t be profitable for you.

Track your time 

In order to accurately enforce your hourly rate, make sure you’re diligently tracking your time. You can use software, make your own spreadsheet, or go old school with a pen and a piece of paper. ‍

Remember — you’re in control

As a freelancer, you can determine your schedule, who you work with, and how much you charge — it’s all really up to you! It’s important to remember your hourly rate isn’t set in stone. You should revisit it frequently to make sure it’s in line with your financial situation, industry, and skillset. ‍

Try out the rate you’ve calculated today, and if you find it’s not working for you, tweak it! Conversations with prospective clients and market research will help you determine if it’s a rate you should continue using. As we mentioned before, you can always adjust your rate as you increase your expertise and change your income goals. 

Freelancing is all about flexibility — and your hourly rate should reflect that, in order to accommodate all of the different clients you’ll be working with and the different projects you’ll be taking on.