Somewhere right now, a wildly talented woman is working out how much to charge, and it goes like this: open three competitors’ websites, find the ones that actually list prices, average them, then knock off a little “because I’m newer.”
If that’s how you answered “how much should I charge?”, you’re in very good company. Looking at what everyone else charges feels responsible. It feels like research. And it isn’t useless. It’s just the wrong place to start, because it skips the one number that’s actually about you.
Ask me how I know. In my early twenties I said yes to “exposure” far more often than I’d like to admit. (Fun fact: exposure is not accepted at the grocery store.) What finally changed my pricing wasn’t finding the perfect market rate. It was finding my own number first.
Short answer: Start with your floor: the lowest hourly rate that still pays for your business, your life and your taxes, based on your real billable hours. Then check what the market expects and what the outcome is worth to your client, and set your price above your floor, somewhere between those two. If your floor sits above the market, change the offer, the audience or the model, never the floor.
Why is copying competitors a risky way to decide what to charge?
Because a price tag only shows you the tip of the iceberg. You can see what someone charges. You can’t see what it costs them to work, how many hours they actually sell, or whether that price is working for them at all.
Here’s what’s hiding under the water on every pricing page you’ve ever peeked at:
- Their costs. Maybe they’re on a partner’s health insurance and their home is paid off. Maybe they have a team of three and a studio lease.
- Their hours. Someone who bills 30 hours a week can charge less per hour than someone who bills 15 and still take home more.
- Their strategy. That low price might be a doorway into a bigger program. That high price might be designed to gently repel the wrong clients.
- Their reality. You have no idea whether they’re thriving or quietly drowning. A published price is not proof of a working business.
When you copy a price, you copy every assumption underneath it. And not one of those assumptions was made with your rent, your family or your energy in mind.
What is the number nobody talks about?
It’s your floor: the lowest rate you can charge per billable hour and still cover your business, your life and your taxes. Nobody posts it, because it’s personal. It’s built from your rent, your health insurance, your retirement and your real hours. That’s exactly why it has to come first.
Your floor is not your price. It’s the line your price never crosses. Think of it as a foundation: you can build almost any kind of house on top of it, but you can’t build below it.
The recipe is simple, even if the shopping list is long: everything your year costs (business, life, fees and taxes, self-employment tax included) divided by the hours a client will genuinely pay for. I’m not your CPA, so run the tax part by one. The point today isn’t the full calculation. The point is the order: you first, then everyone else.
The Inside-Out Price Check
This is the method I walk through with anyone who asks me “how much should I charge?” It’s three numbers, gathered from the inside out.
| Number | What it is | Where you find it | The question it answers |
|---|---|---|---|
| 1. Inside | Your floor per billable hour | Your own costs, life, taxes and hours | What do I need? |
| 2. Outside | The range similar offers sell for | Five to ten comparable businesses, plus what’s in their packages | What does the market expect? |
| 3. Outcome | What the result is worth to your client | Their words, their goals, the cost of the problem staying unsolved | What is this worth? |
Then you look at where the three land, because the relationship between them tells you what to do:
- Your floor is below the market range. Good news: there’s room. Price inside the range, or above it if the outcome is big. Don’t price at your floor just because you technically can.
- Your floor is inside the market range. Aim for the upper half of the range. The bottom leaves you zero room for surprises, and it’s an exhausting place to compete.
- Your floor is above the market range. This is the honest, uncomfortable one. Don’t lower your floor. Change something else (more on that below).
- The outcome is far above everything else. Your work changes something big for your clients. Package it around the result, not the hours, and price closer to the value.
What if my floor is higher than what everyone else charges?
Then the market you’re looking at doesn’t fit the business you need, and that’s information, not a verdict. You have four levers, and none of them is “work for less than it costs you.”
- Change the audience. The same skill sells at very different prices to different buyers. A website for a weekend hobby and a website for a busy law practice are not the same purchase.
- Change the package. Bundle the strategy, the support and the follow-through, so you’re not competing with the bare-bones version.
- Change the hours. Templates, processes and tighter scopes can deliver the same result in less time, which raises what you earn per hour without raising your price.
- Change the model. Group programs, digital products and other one-to-many offers can cost each person less while your income per hour goes up.
Sometimes the answer is a mix. Sometimes it’s a slow shift over a year. Either way, you get to decide what you charge, and you decide with your eyes open instead of your fingers crossed.
A worked example: pricing a website copy package
Let’s say you’re a copywriter, and your own numbers put your floor at $70 per billable hour. A new client wants copy for five website pages.
Inside: You estimate 22 hours, including discovery, research, writing, two rounds of revisions and the calls in between. At your floor, that’s $1,540. This project can never cost less than that.
Outside: You look at ten copywriters with similar experience. Their comparable packages run from about $1,200 to $4,500, and the higher ones tend to include strategy and SEO.
Outcome: This client’s website is their main sales tool. They told you their current copy “sounds like everyone else” and they’re losing inquiries to competitors. Better copy touches every single visitor for years.
So how much should you charge? Not $1,540. Your floor sits at the low end of the market, and the outcome matters a lot to this client. A price around $2,800 (about $127 per estimated hour) respects all three numbers. It’s comfortably above your floor, it sits in the middle of the market, and it’s easy to stand behind next to the result.
Notice what didn’t happen: nobody averaged three websites and knocked off a little for being new.
Should I charge hourly or by the project?
Use your hourly floor to build the price, then sell the project. Hourly pricing punishes you for getting faster and turns clients into clock-watchers. Project pricing lets you price the result.
The simple formula is estimated hours × your rate, plus a cushion for the surprises every project brings. Round it to a number that feels clean. Your hourly number stays behind the scenes, quietly doing its job as your safety net.
The exception is open-ended work that’s hard to predict, like ongoing tech support or “help with whatever comes up.” That can be fairer as an hourly rate or a block of hours. Use whatever structure protects your floor.
Try this today (15 minutes)
Pull out a sticky note and write three lines:
- Inside: your best guess at your floor per billable hour. If you have no idea, write a question mark. That question mark is your homework.
- Outside: the price range from five comparable businesses. Jot down what’s included, not just the number.
- Outcome: one sentence about what your client’s life or business looks like after working with you, in their words if you have them.
Now look at your current price. Which of the three numbers did it come from? If the honest answer is “mostly number two,” you’ve just found your next step.
If you want the inside number without the spreadsheet
The inside number is the one people skip, because it’s the one that takes real math. That’s why I built the Profit Calculator. It walks you through every personal and business cost (daily, monthly or yearly, whichever way your brain keeps track), layers in your sales fees and current-year US taxes, and gives you a floor you can trust plus a thriving rate to aim for.
It’s $27. And once you know your floor, the other two numbers get a whole lot less scary.
Quick answers
How much should I charge per hour as a freelancer?
Start from your break-even floor: what a year of business costs, living costs and taxes adds up to, divided by your realistic billable hours. Then compare that floor with the market range for your kind of work and the value of the outcome. Your hourly rate should usually sit well above your floor, because the floor only keeps you whole.
How do I know if I’m undercharging?
You’re probably undercharging if your rate is below your break-even floor, if you’re fully booked and still short on money, or if your real hourly rate (revenue divided by every hour you worked) is far below what you quote. Another clue: clients say yes instantly and never once ask about price.
Is it okay to charge more than my competitors?
Yes. Your competitors’ prices are built on their costs, hours and strategy, not yours. If your floor or the value of your work is higher, charge more and make the difference clear in what’s included and who it’s for. Charging more than competitors is a positioning choice, not something to apologize for.
Should I list what I charge on my website?
It depends on your offer. Listing prices, or “starting at” prices, filters out poor-fit inquiries and saves everyone an awkward call. Custom work with very different scopes is harder to list. A good middle ground is a starting price plus what usually changes it, so clients know the ballpark before booking.
How often should I review what I charge?
Review your prices at least once a year, and any time your costs, hours or life change, like a move, a new health insurance plan or a shift in how much you can bill. Recalculate your floor first, then check the market and your client outcomes again before you decide on new prices.
Your price is allowed to start with you. Everything else is just context.