Living

Charge for what you do, not how long it takes

From salaried to freelance

Headshot of Jesse Friedman
Jesse FriedmanJuly 30, 2024
A person wearing glasses and a denim jacket over a yellow top smiles while looking at a tablet in a bright, plant-decorated office space.

Before you began your entrepreneurial journey, you likely earned wages or a salary of some sort. The amount and extent of the work you did was a dance of employer and employee figuring out what needs to be done.

Many of us left the salaried world because we wanted more flexibility. What many don’t realize is the hourly model many freelancers adopt works against that time freedom.

It doesn’t have to be this way, and yet even professionals with decades of experience sell their services by the hour. After all, it seems straightforward. Time is the most fungible thing we have to offer.

There’s only one problem: professional work doesn’t align neatly with the clock.

The psychological toll of hourly work

It’s hard to do your best work when you’re thinking in terms of monetized hours. I’ve found myself sitting at the chair, trying to force myself to write because this is the time I’m being paid for, while the only ideas I have are for everything but what I’m contracted for.

For some people, once you get in a groove, you might stretch the hours of projects that ended up taking less time than expected. Or perhaps finish a project when it’s good enough but could have been exceptional with a bit more time.

This negotiation between work and time is rough on the psyche.

Sure, you can take that hike on a Wednesday morning because your work isn’t due until next week, but what if you spent those three hours getting it done sooner in case more work shows up? What happens if you forget to start your time tracker? Can you bill for the time spent thinking about the client’s problems in the shower? Do you have to pause the clock to take a phone call or a bio break? (Never mind. We’re not in the office anymore. We can speak like normal people and call it going to the bathroom.)

When your time has a price, every moment is open to scrutiny and that quickly gets exhausting.

Value-based pricing enhances client relationships

Charging an hourly rate presents more than a time challenge for your business–it can decrease the perceived value of your talents and expertise.

You and the client have a common goal in getting work done well. It shouldn’t matter if it takes less or more time to do it. Your current and future clients are most interested in the results and impact of your work.

Below are a few ways to package your services. You don’t have to choose just one. In fact, I use most of these models in my own business.

Fractional pricing

Fractional services are offered on somewhat of a retainer model and cover the responsibilities of a regular hire. It’s like you're salaried, with varying projects and office chatter, and maybe even mentoring others, but for part of the time. (Though it's not really a salary because you don't get benefits and protection, so charge more!) PTO and holidays may also be treated differently, so make sure you clarify that up front.

Fractional pricing isn't just a fancy way of saying you’ll set aside a certain number of hours for a client. Both in conversation and in your contract, set the expectation of when and how you'll be working—some days more, some less–but always focused on goals, deadlines and responsiveness, not punching in and out.

Pricing by deliverable

If your engagement is for specific or big tasks, you may decide it’s best to price your offering based on the deliverable. There's always the fear and risk that it'll take longer than anticipated, so put on guardrails—turnaround time, rounds of revision—and get a tight scope of work (SOW) in place.

If you end up spending more time than expected and are unhappy with the rate you charged, treat it as a business learning moment and raise rates next time around. On the other hand, if it took less time than expected, hooray, take that walk in the woods and don’t think twice.

Pricing by increment

Consider pricing by increment if you’re delivering work at volume, such as per blog post or piece of art. T-shirt sizing like small, medium and large is a nice framework to think about incremental pricing tiers. You can define these tiers based on a rough number of words, or complexity of illustration, or whatever else you do. Writing by the word also logically falls under this umbrella; some writers love it, others hate it, you do what works for you and your client.

Day-rate pricing

I know of a few people who offer their full attention for a short duration, usually a day. This typically works best for strategic discussions and holds a particular advantage: your client is more likely to be invested in your work because they’ll be sitting with you most or all of the time. If you’re confident in your expertise, you can sometimes charge quite a bit for this sort of professional jam session.

Hourly billing

There may still be instances when a client insists on hourly work. Often this is simply because of how their billing process works (sometimes called procurement). In this case, do two things:

  1. Set your rate higher than your typical rate for other kinds of work.
  2. Insist on a retainer of hours, so you can get paid for the time you’ve blocked for them, even if they can’t find any work for you to do.

If I may also give my recommendation as a marketer, when you’re treating your work as services rather than time, price and list them as such. Make it easy to buy! Frame any price adjustments relative to that. You can always advertise a special discount based on the season, non-profit status or any other reason, if that’s what you need to get contracts signed. Use Pollen’s rate calculator to work backwards into what ought to be your minimum rate.

There’s power in transparent pricing, so don’t be afraid to list your rates publicly. It gets you out of the obnoxious budget/rate negotiation spiral. You may also be surprised by how many people simply accept what you charge.

Breaking up with your hourly rate is profitable

In the end, you’re still spending time working in exchange for money, and time divided by money is an hourly rate. But hopefully you’ll feel more at ease, more confident in your business and better perceived by clients by charging not for minutes and hours, but for the value you bring to the job.

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Headshot of Jesse Friedman
Jesse Friedman

Jesse Friedman is a veteran product, brand and content marketer. He's worked worked on iconic products such as Maps and Translate at Google, and more recently led product marketing and three different B2B startups, before shifting to fractional marketing work. He lives in Portland, Oregon with wife, kids, pets and several tomato plants.