You earned €40,000 as an employee, so you quote €20/hour as a freelancer. A year later you're exhausted and earning less than before. The maths was wrong from the start — let's fix it.
The salary-math trap
An employee's salary hides a lot: the employer pays social charges, equipment, software, holidays, sick days and the hours spent in meetings. As a freelancer, all of that comes out of your rate — and you only get paid for the hours a client is billed.
Your real minimum rate
Put in honest numbers. Be pessimistic about billable time — almost everyone overestimates it.
Minimum hourly rate
$66
≈ $316 per working day
The “salary math” trap
Dividing your income by 2,080 hours (a full-time year) gives $24/h. That's 2.7× too low.
red = what salary math gives you, relative to what you need
You need $72,667 in revenue from only 1,104 billable hours. Where every invoice goes:
Your calculated rate isn't what you're worth. It's the price below which you lose money.
Hourly, daily, project or value?
Hourly
Fair for vague, changing work (maintenance, consulting). Downside: you earn less as you get faster.
Day rate
Fewer tiny invoices, less micromanagement. Common for developers, designers and consultants.
Fixed project price
Estimate hours × rate, add a 20–30% buffer for the unknown, and define the scope precisely. Anything outside it becomes a paid change request.
Value-based
Price on what the result is worth to the client. A website that brings a clinic 10 extra patients a month is worth far more than “40 hours of work”.
Quick check
You finish a fixed-price €2,000 project in 20 hours instead of 40. What's your effective hourly rate?
How to raise your prices
- New clients first — quote every new lead higher than the last one.
- Package your service (“Starter site”, “Growth site”) so clients compare outcomes, not hourly rates.
- Show results: case studies with numbers justify higher prices better than any argument.
- Give notice to existing clients: “From March, my rate becomes X.” Most stay.
- Losing a few price-sensitive leads is a good sign: you were too cheap.
- Always ask for a deposit (30–50%) before starting.