How to price freelance work without guessing

Most freelancers set rates by looking sideways at what other people charge. That is a reasonable starting point and a terrible finishing point, because it ignores your cost base, your utilisation and the value of the outcome you deliver.

Take your target annual income, add business costs, taxes and time off, then divide by the number of billable hours you can realistically deliver. Most independents bill between 55% and 70% of their working hours once admin and sales are accounted for.

A forty-hour week is not forty billable hours. Track two typical weeks and you will usually find between twenty-two and twenty-eight hours of client work, with the rest going to proposals, invoicing and support.

Dividing by the honest number rather than the optimistic one is the difference between a rate that funds your business and one that quietly drains it.

Your cost-derived number is a floor, not a price. From there, adjust upwards for scarcity, urgency and measurable business impact. A migration that unblocks a launch is worth more than the same hours spent on a maintenance backlog.

Value-based adjustments work best when you can name the outcome in the client's own numbers: revenue unlocked, hours saved, risk removed.

Rates that are never revisited quietly decay against inflation and your own growing capability. Put a recurring thirty-minute review in the calendar and treat it as billable work.

Raise on new clients first, then existing ones with notice. Most churn people fear never arrives.