How to Price a Freelance Job When You Have No Idea What to Charge

The floor: revenue you need before you call it a rate

A price chosen bottom-up starts with cost, not comparison. The example I will carry through the whole guide, round enough to check every step: $4,000 a month of living and $200 a month of software and bookkeeping, so $50,400 a year that has to come out of gross invoices, not profit.

Gross, because the tax reserve is the multiplier everyone forgets while employed: a salaried person never sees the gap between what the employer pays and what reaches the account, and you are now the employer. I am not asserting a rate for your jurisdiction, and no number here is tax advice - treat the reserve as a planning divisor you choose on purpose:

needed revenue = yearly cost / (1 - tax reserve)

($48,000 + $2,400) / 0.75 = $67,200

The divisor is a dial, and it turns hard. At a 30% reserve instead of 25%, the same $50,400 needs $50,400 / 0.70 = $72,000: a $4,800 move, about ten days at the day rate the next section produces.

The day rate: divide by the days you actually sell

52 weeks times five is 260 working days, and 260 is a lie. Take out three weeks of vacation and holidays (15 days) and one week of being sick or dealing with your own life (5). What is left, 240, is still not billable: a freelance week also eats time answering RFPs, writing this quote, chasing that invoice, and sitting between projects. The share of the year you actually sell is the most important input in the chain, so it comes as a range, not a claim:

Look at what the denominator does: $400 a day sold at 70% versus $560 at 50%, cost floor, ambition and skill unchanged. The share is directly measurable: open the last four weeks of your calendar, count the days you did work a client is paying for, divide. If it reads 55%, the lever is filling the calendar, not inflating the rate.

Carrying the example: 144 billable days gives $466.67, and I round up to the nearest ten, so day rate = $470. Divide it by 8 only to know what a client's hourly comparison sees - $58.75 - and do not send that number as a wage. The day rate is the exchange rate between your calendar and money; the quote below is what you actually sell.

The fixed quote: days, times rate, times a chosen margin

Fixed-price means the client buys an outcome, and you keep the profit if you are faster than you thought - which only works if you are honest about the estimate. Take the scope example the contract template itself ships with: "Design of a 5-page marketing website including up to 2 revision rounds per page." At a $470 day rate, that scope prices as:

setup and research                0.5 days
5 pages x 0.75                    3.75 days
2 revision rounds x 0.5           1.0 days
handoff, asset prep, QA           0.75 days
                              ---------
estimate                          6.0 days
6.0 x $470                        $2,820
plus 20% estimate margin          $3,384
quote, rounded                    $3,400

The 20% should not be padding; it should come from your own overrun history, the one input most people already have and never tally. And it has a physical meaning worth stating out loud: $3,400 at $470 a day pays your floor for 7.2 days of work. Land in 6 and the margin is profit; take 7 and the effective hourly is $60.71, still above the comparison floor; spill into day 8 and it is $53.13, below the rate you computed this morning. The margin is literally how many days of being wrong you bought.

Why fixed rather than hourly? Certainty for the client; for you, getting paid for speed instead of padding timesheets. The kit's proposal ships both shapes, including an hourly fallback ("Or hourly: $[RATE]/hour, estimated [RANGE] hours") invoiced monthly against time logs, so the format is per client, not per career.

What holds the quote: scope plus a priced change order

A fixed price without a scope boundary is a donation with extra steps, because every "quick thing" spends the margin you chose. Two sentences in the contract template do this job, verbatim:

Work outside Exhibit A's scope requires a written (email
is fine) change order with adjusted fees and timeline
before it begins.

...and in the revisions section, the distinction that stops revisions from becoming free work:

Included: [2] rounds of revision per deliverable within
the agreed scope. Additional rounds are billed at [RATE]
per round/hour. "Revision" means changes within the
original direction; a change of direction is new scope
(Section 1).

So "make the homepage warmer" is round two; "actually, can it also take pre-orders" is new scope. The explicit out-of-scope list in Exhibit A is what lets you tell them apart without being the person who says no to everything; guide 01's clause 4 goes deeper on writing that list.

Then the change order itself. It prices at the same day rate as everything else, and it takes two sentences:

Subject: Re: [Project] - adding the pre-order flow

Happy to do that. It sits outside Exhibit A, so it prices
at 1 day - $470 - and pushes delivery by 3 working days.
Reply "go" and I'll send the updated Exhibit A before
I start.

Three things do work there: number and date extension stated as arithmetic, not negotiation; the written trail, because the clause asked for "written" and a reply in the project thread is that; and the word "before", because change-order fees quoted after the work are a discount by another name. Three free one-day add-ons are $1,410 of work you funded, more than the margin you priced in.

The deposit: what it actually protects, in dollars

The contract's schedule options are 50% before work begins and 50% on final delivery, monthly invoicing on NET [15] days, or milestones. On the $3,400 quote, the deposit is $1,700, which is 3.6 days of work at $470. Run the cancellation scenarios against that number instead of against feelings:

• Client ghosts at kickoff. You hold $1,700 and have done no work. This is the deposit doing its whole job: the loss is a calendar slot, and the money has already moved your way.
• Client cancels after 3 days. $1,410 of work performed, fully covered by money already collected. The cancellation clause is a receipt, not a fight.
• Client cancels after 5 days. $2,350 owed against $1,700 held. Now the paperwork earns its keep: "Client pays for all work performed through termination plus any non-cancellable expenses", and if they cancel for convenience, the kill fee adds "[25]% of the fees for undelivered Exhibit A work" - the kit's own note explains that this pays for the calendar slot you can no longer sell.

What the deposit does not protect is the tail. On the 50/50 split the second $1,700 rides on net terms: a six-week project delivering on day 42 and invoiced NET 15 gets paid, at best, on day 57; at worst it becomes the chase, and the chase is guide 06. One habit worth stealing: fill the invoice's Due [DATE + NET TERMS] block with the literal calendar date. "Within 15 days" is an argument; "Due 14 October 2026" is a fact. The proposal dates your side too: "Valid until: [DATE + 14 DAYS]".

Sending the number so it survives the conversation

The proposal's Investment section is three brackets under a total: "[$X] deposit due at signing", "[$Y] at milestone 1", "[$Z] on final delivery". That file's how-to-use notes say the number "should never be a surprise number" and to "anchor it verbally" before the document lands - habit, not data, and it is mine: say "this lands around three and a half" on the call, then let the proposal confirm it in writing.

And the honest limit of the method: it cannot tell you the market rate for your niche, because no rate table was verifiable for this page. What the chain gives you is a number you can walk a skeptical client through without flinching: floor, measured days, estimate, margin. Every input is yours, so "that feels expensive" has a real answer ("what part would you cut?") and an honest one ("below this, the math says I lose money on you"). A price you can derive out loud beats a price you feel confident about; confidence without the chain is the same guess, louder.

The 30-second version

1. Floor: (personal + business cost) / (1 - chosen tax reserve). Example: $50,400 / 0.75 = $67,200.
2. Day rate: floor / billable days. 240 available x 60% sold = 144 days, so $466.67, rounded to $470. Measure the 60%; do not guess it.
3. Quote: estimate x rate x (1 + margin). 6 days x $470 x 1.2 = $3,384, sent as $3,400. The margin buys days of being wrong.
4. Scope and change order hold the quote: out-of-scope is one day at the same rate, written, before the work.
5. Deposit sizes the cancellation risk: $1,700 on this quote covers 3.6 days. The tail is net-terms and the chase.
6. No rate table is quoted anywhere above. Every number is a labelled example or a line of arithmetic to re-run with your own inputs.