How to Price Your Freelance Services (Without Undercharging)
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Almost every freelancer starts out underpricing — then resents the work, burns out, and blames freelancing. The problem is rarely the market; it’s a pricing approach built on fear instead of value. This guide gives you a clear way to set rates you can defend, raise them over time, and handle the inevitable “that’s too expensive” without folding.
The three ways to price (and which to use)
1. Hourly. Simple and common, but it punishes you for being efficient and caps your income at your hours. Fine when scope is genuinely unknown (use it for open-ended work), but it’s the weakest long-term model.
2. Per project (flat fee). You quote one price for a defined deliverable. Better than hourly because the client knows the total and you’re rewarded for working efficiently. This should be your default for most defined work.
3. Value-based. You price on the outcome’s worth to the client, not your time. A sales page that earns them $50k is worth far more than “8 hours of writing.” Hardest to do early (it requires confidence and proof), but it’s where the real money is. Grow toward it.
For most freelancers: start with per-project pricing, and move toward value-based as you build proof.
How to set your first rate
If you have no idea where to start:
- Find your floor. Calculate the minimum you need per month (expenses + income goal + taxes + non-billable time). Divide by realistic billable hours to get an effective hourly floor. Never knowingly price below it.
- Check the market. Look at what comparable freelancers charge on Fiverr/Upwork and in your niche. Aim for the middle, not the bottom — the bottom attracts the worst clients.
- Translate to project prices. Estimate the hours a typical project takes, multiply by your rate, and add a buffer (work always takes longer than you think). Quote that as a flat fee.
Your first rate doesn’t need to be perfect — it needs to be sustainable and raisable.
When and how to raise your rates
Raise when any of these are true: you’re fully booked, you’re winning almost every quote (a sign you’re too cheap), or you’ve added skills/proof. How:
- Raise on new clients first — quote the higher number to everyone new.
- Grandfather or gently increase existing clients with notice.
- Use proof to justify it — testimonials and results make a higher price feel obvious.
A useful rule: if you’re not occasionally losing a quote on price, your price is too low.
Handling “that’s too expensive”
This objection is normal and not a no. Options that don’t involve slashing your rate:
- Reduce scope, not price. “I can hit [lower budget] by doing [smaller version].” This protects your rate while meeting their budget.
- Offer tiers. A “good/better/best” quote lets them self-select down without you discounting.
- Hold the line calmly. “I understand — this is what it costs to do it properly. I’d rather deliver real value than cut corners.” Some clients aren’t yours, and that’s fine.
What you should almost never do is panic-discount. It signals your first price was fake and trains the client to push.
Mistakes that keep freelancers underpaid
- Pricing on time, not value — caps your income forever.
- Quoting before understanding scope — leads to underbidding and resentment.
- Never raising rates — your skills grow; your prices should too.
- No deposit — get part upfront so you’re never working for free.
- Competing on being cheapest — there’s always someone cheaper, and they get the worst clients.
The honest bottom line
Price per project, anchored to the value you deliver and a floor you can live on. Start at the middle of your market, raise as proof accumulates, and handle price objections by adjusting scope or offering tiers — not by caving. Confident, fair pricing is what turns freelancing from a hustle into a business.
Get the business side done-for-you: the Freelancer’s Client Toolkit includes proposal, agreement, invoice, and payment-follow-up templates built around these pricing principles.
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Frequently asked questions
How do I set my first freelance rate?
Research what others charge for similar work, factor in your costs and the income you need, and pick a starting rate slightly below your eventual target to win the first few jobs and reviews. Then raise it as you build proof — don't anchor permanently to a beginner rate.
Should I charge hourly or per project?
Per-project (or value-based) pricing is usually better — it ties your fee to the outcome rather than the clock, rewards efficiency, and gives clients a predictable cost. Hourly can work for open-ended or ongoing work, but it caps your income at your time.
How do I avoid undercharging as a freelancer?
Price on the value and outcome you deliver, not just your time; raise rates as your skills and proof grow; and don't let fear of rejection keep you cheap. A higher price with a clear result often wins better clients than a bargain rate.
How do I respond when a client says I'm too expensive?
Reframe around value and outcomes, offer a smaller scoped option rather than just dropping your price, and be willing to walk away. Discounting reflexively trains clients to expect it and undervalues your work.