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Pricing on a continuum
A lil sneak peak into TWC's June pricing masterclass
When I first began freelancing, I made the rookie mistake of letting the market dictate my rates. One client paid me $25/hour to fact-check magazine features. Another paid me $50/hour for research. Once someone offered me more, it was a signal to me that I was worth more and that I should raise my rates incrementally.
It wasn’t until 2020 when I realized I wanted to make a six figures income. The adage, “what got you here won’t get you there” feels relevant – I realized my haphazard accept-what-I-can-and-always-ask-for-more approach to pricing got me to making $50k, but it was never ever going to get me to double my income – and definitely not in a way that would be sustainable for my mental health. (I wrote about this a few newsletters back – you can read it here!)
I made a completely new business plan, which really just means I did a lot of math. If I wanted to make $100k, take three months of vacation (luxurious, I know, but why not aim high?) and have a maximum of 25 billable hours a week, my effective hourly rate would have to be $100/hour.
That became my floor. In other words, if I was making an effective hourly rate of $100/h off all my clients and projects, I’d be able to hit my income target. If I accepted anything less, it wouldn’t be the end of the world, but I’d need other higher-paying clients to even the math out.
I heard a podcast episode that mentioned I should consider a secret hourly rate. I love secrets, so I was very into this concept. Here’s the scoop on secret rates:
As a guidance, secret hourly rates ought to be at least twice as much as your effective hourly rate.
Secret hourly rates are the rates that you strive to hit, usually by pricing projects based on value, versus the actual time you’re putting in.
Secret hourly rates are secret because your client has no idea what your hourly rate is coming to, nor should they if they are paying you based on the value of the service you’re providing them.
As such, my rates range from $100-$300/hour – and sometimes more for lectures and other high-value speaking engagements. This continuum gives me enough flexibility to take on projects on the lower range and still be able to earn what I need without working more, and charge more on the higher end for select projects, knowing that when I book those, I have the option of working slightly less!
Coming up with this range is the first thing I’ll be having all my pricing masterclass participants do, with the help of our popular online class on business planning.
Because once you have those numbers, then we can talk about when different points on that continuum will make sense.
Do you think it’s time for you to revamp your business and adjust your pricing model to avoid burnout, pricing angst, and/or resenting your client?
If so, our June masterclass is what you want. We’ll meet three times a month to discuss pricing challenges. You’ll get a 1:1 coaching session with me to individually brainstorm what you need to do to raise your prices with your clients (new and existing), and you’ll come out with renewed confidence in pricing.
Learn more and join us!
Signups end May 25, and you get 30% off the whole deal as a recurring Patreon subscriber.
Let me know if you have any questions, and I hope to see you there!
Other new TWC offerings:
June 8, 1:30-2:30pm PST - Build your audience and monetize your newsletter with Chris La Tray and Melinda Wenner Moyer! If you’re looking to start a newsletter with the intention of monetizing it – or if you just want to grow your newsletter audience, our June event is for you. Chris and Melinda built their popular newsletters as freelancers and will share all their best tips. Register today!
Laid off? We’ve got some free and deeply discounted resources! We’ve made our worksheet on processing your layoff public and free. It helps you get in touch with the emotions you’re feeling, and then begin to think about potential paths forward. If you wish to pursue freelancing after a layoff, we’ve collated some of the best resources for this in the LAYOFF TO FREELANCE SURVIVAL GUIDE.