📱 Idea: Drawing from years of firsthand experience as a seasoned freelancer, having hired thousands of freelancers for my company and mentored thousands of students who have collectively earned millions of dollars, I’ve garnered some insights into how much you can charge as a freelancer.
I tried to put them into this calculator — have fun! 👇
Here’s an overview of all six features we’ve included in the freelance rate calculator, along with explanations on how each impacts the freelancer’s rate:
- Years of Experience: Measures the freelancer’s years of working experience in their specialty area. More experience generally justifies higher rates due to the freelancer’s proven expertise and reliability. However, the impact of experience on the rate diminishes after 10 years, reflecting the notion that while experience remains valuable, the incremental benefit on project outcomes plateaus.
- Gig Volume (in hours): Estimates the total hours needed to complete the gig. Larger projects might see a slightly lower hourly rate due to bulk work, which offers the freelancer sustained income over time. Conversely, very small projects might command higher hourly rates due to the overhead of project setup and shorter engagement duration.
- Specialty Skill Demand: Reflects the market demand for the specific skills required for the gig. Skills in higher demand (e.g., emerging technologies) allow freelancers to charge more. This is due to the principle of supply and demand: scarce skills that are in high demand lead to higher rates.
- Market Demand for Freelancers: Indicates the overall demand for freelance services in the market, regardless of specific skill sets. Higher general market demand for freelancers suggests that businesses are more inclined to hire external experts, potentially allowing freelancers to charge more due to increased opportunities.
- Availability of Freelancers: Represents the current supply of freelancers in the market who can provide similar services. A high availability (or supply) of freelancers might lead to lower rates due to competition, while low availability (fewer freelancers offering the service) can drive rates up as clients have fewer options to choose from.
- Value for the Client: A subjective measure assessing how critical the project is to the client’s success. Projects deemed of high value to the client, possibly due to their potential to significantly impact the client’s revenue or operations, can justify higher rates. This is because the client is likely to derive more value from the freelancer’s work, making them willing to invest more in it.
What’s the TLDR of This Calculator?
The calculator is designed around the core principle of supply and demand which affects pricing in nearly every market, including freelance services.
Higher demand for a freelancer’s specific skills or general freelance services, combined with lower availability of qualified freelancers, allows for charging higher rates.
Experience adds to a freelancer’s credibility and the perceived quality of work, justifying higher rates. However, this is moderated by the recognition that extremely high levels of experience do not always translate to correspondingly higher value for the client.
The nature of the project (volume and value to the client) also plays a significant role. Projects with high value to the client or those with either very high or very low volumes can affect rates due to the perceived importance or the economics of scale and overhead costs.