Ah, the great dilemma almost every freelancer faces: how much should you charge for your freelancing work? Should you go for a fixed price or calculate an hourly rate? What if the client wants to negotiate?

These types of questions can cause major headaches, and learning the best practices isn’t always easy. In this article we’ll help you tackle these questions, so that you can confidently negotiate your next freelance project.

Calculate your living costs

setting your freelancer rate
Always consider your monthly expenses before setting your freelance rate.

Before thinking about your income, it’s important to track your monthly expenses so you know what you need to earn at a minimum. There are a ton of online calculators to help with your expenses, or a simple notepad can achieve the same results.

Start by listing out all of your monthly expenses, including:

  • rent
  • internet and other utilities
  • cell phone bills
  • car insurance and gas
  • groceries
  • any software subscriptions (Adobe Suite, etc)
  • coworking spaces
  • your overpriced coffee addiction

When you have a solid list, add your expenses together to get a good idea of your minimum goal per month. Of course, you can always break down your monthly goal into a weekly goal by dividing it by 4. Or figure out your yearly minimum by multiplying it by 12.

Remember to regularly revise your expenses as they may fluctuate over time.

Okay, so now you have a minimum goal set up, let’s talk about your options when working on projects.

Option 1: Charge per project

charging per project
Charging per project keeps client expectations clear and your math simple.


  • Easy to understand for the customer
  • Time tracking isn’t necessary
  • Simplifies your calculations
  • Allows you to take on multiple projects at once
  • If you work and complete projects fast, your quotes seem much more reasonable than if you were to translate them into an hourly rate


  • Difficult customers might use this to their advantage to get you to do more work
  • Expect an increase in the duration of your projects
  • Expect a demand for multiple revisions and/or drafts
  • Time frames are very unreliable
  • Requires a strong grip on the customer relationship

Example of calculations on a per project basis

  • Minimum quote per project: $500
  • Living expenses per year: $1,000 x 12 = $12,000
  • Minimum projects per year: 24
  • Minimum projects per month: 2

I’m just using random numbers for this example to keep it simple. Once you apply accurate, real world calculations, you’ll end up with a nice figure to help you track your income vs. expenses.

How to handle additional work

Work that wasn’t included in the original brief is something that’s requested from time to time, and it’s important to know how to manage it. Make sure you always quote exactly what the client should expect to see in their final deliverables.

For example, if you’re working on a web project then include the exact number of pages, the exact features that will be included, etc. Things like pop-ups, forms, intermediate pages may not be included in the client’s original brief, and it’s up to you to foresee these additional features, and address them before you start working.

It’s important to fully understand the project before you set a quote. It’s okay to ask for additional information to ensure you know what the client is expecting. For example, I may ask my client to provide a rough wireframe of how they’re picturing their desired website. This additional information will help you avoid any miscommunication with your client down the road.

Option 2: Charge per hour

charge hourly
Charging hourly is a great way to handle ongoing projects.

The advantages

  • Generally, clients use your time more wisely
  • You have a more relaxed approach on your projects
  • Cuts down on the number of revisions
  • Time frames are usually more reliable
  • Any additional tasks not included in the initial brief aren’t a big deal

The drawbacks

  • Requires time tracking and a reliable way to let your client know how much you’re actually working
  • Limits your ability to ‘juggle’ multiple projects
  • Requires strict living expense calculations
  • Seems less trustful to smaller clients who may not believe your number of hours quoted.

Example of calculations on a per hour basis

  • 240 working days = 365 days – 104 weekends – 14 holidays – 7 sick days
  • 1920 maximum billable hours in a year = 8 hours per day x 240
  • Let’s say you’re working on projects a conservative 40% of that time:
    • 768 billable hours = 1920 x 0.4
    • Living expenses per year: $1,000 x 12 = $12,000
    • Minimum hourly rate: 12,000 / 768 = $15,6

Again, this is a rough example with random numbers, but can help you when you apply accurate, real world calculations.

How to handle additional work

Additional work doesn’t really harm you when you’re working on an hourly rate — you might actually welcome them. They might have an impact in your scheduling, yet additional work is great news if your calculations are on point. A word of advice: always be sure you write every additional request down.

Handling negotiations

You should always negotiate your quote at the beginning of a project — never at the end. From my personal experience, negotiating has its place in a lot of situations but not in freelancing.

It’s important to portray a trustworthy image by being transparent and quoting fair prices. You should be able to deconstruct your quote based on your assessment of the project, your skill level, the deadline, etc. And if a client still isn’t happy, then they’re not the right person for you.

Read our annual freelance report – Design without borders to gain a fresh perspective on how freelancers around the world think, feel and operate.

It’s really up to you on whether you’d like to charge by project or by an hourly rate. What’s really important is to track your living expenses accurately and adjust your calculations accordingly. My personal recommendation is to keep a fair and transparent price at all times and avoid any negotiations.