Liberate yourself from the hourly rate

As a freelancer, charging solely by an hourly or daily rate can feel like an easy default. It’s straightforward, familiar, and logical because, well, time equals money, right? Except that it doesn’t. If you’re sticking to this method exclusively, you might be limiting your earning potential and creating unnecessary challenges for yourself and your clients.

An hourly rate caps your income based on the finite time you have, fails to reflect the unique value you deliver, and can negatively impact your client relationships with open-ended timelines and unexpected bills causing frustration. It’s time to think differently about how you price your work, allowing you to unlock more flexibility, balance, and better financial gains.

Here are some alternative pricing models to consider, with tips on when and how to use them.

1. The Fixed Project Fee

Why it works: Fixed project fees establish clear expectations for both you and your client. No surprises, no bill shock - just a clear, agreed-upon cost upfront. This predictability helps clients feel comfortable, and it allows you to forecast your income more effectively.

How to implement:

• Define the scope of work in detail. Specify deliverables, timelines, rounds of revisions, and what’s excluded.

• Calculate your fee based on your expected hours or create a standard rate card for recurring tasks (e.g., $X for a social media campaign, $Y for a full branding package).

• Present the fee as a single, unitemised cost to emphasise the value, not the time spent.

Pro tip: Always have a signed agreement in place to avoid scope creep.

2. The Subscription (a.k.a. the 2025 version of a retainer)

Why it works: Subscriptions provide consistent, predictable income. For clients with ongoing needs, a subscription model ensures you’re available to them without constant renegotiation.

How to implement:

• Offer different subscription tiers based on the client’s needs (e.g., 10 hours/month for $X, 20 hours/month for $Y).

• Define what’s included (and not included) to avoid misunderstandings.

• Negotiate payment terms and cancellation policies to protect your time and income.

Pro tip: Think about how you can standardise your fees as much as possible for efficiency (just like a SaaS product with pricing tiers, for example).

3. The Virtual Coffee

Why it works: Ad hoc requests can be time-draining if not managed. By turning these into paid sessions, you create a win-win scenario: clients get expert advice without a big commitment, and you get compensated for your time.

How to implement:

• Set a fixed fee for short consultations (e.g., $400 AUD for a 60-minute virtual session + 30-minute follow-up).

• Use tools like Calendly with integrated payment options to make things easy.

Pro tip: Having a structured offer (like LVC’s own Ask a Villager service) makes it easier to say yes or no when approached with casual ‘can I pick your brain?’ requests.

4. The Sprint

Why it works: For clients who need concentrated, high-impact support over a short timeframe, a sprint offers value while commanding a premium price. It’s intensive but rewarding.

How to implement:

• Offer a defined timeframe (e.g., 5 days of in-house strategy planning).

• Price this higher than your daily rate to reflect exclusivity and dedicated focus.

Pro tip: Make sure the scope of work is crystal clear to avoid misunderstandings about post-sprint support.

5. The Referral Fee

Why it works: Freelancers often get asked to take on projects outside their expertise. Referring work to trusted collaborators can create passive income and strengthen your network.

How to implement:

• Build a network of reliable referral partners.

• Agree on terms (e.g., a percentage of the project fee) before making referrals.

• Ensure transparency with your client and referrer to maintain trust.

Bonus advantage: Reciprocity! Other freelancers in your network may refer work back to you, boosting your own pipeline.

6. The Bucket of Hours

Why it works: Hourly rates still have their place for undefined projects. By offering a pre-paid ‘bucket of hours’, you can set a max budget for the client that allows for a degree of flexibility.

How to implement:

• Sell blocks of time (e.g., 10 hours for $X, valid for 90 days).

• Track time carefully to ensure hours are used fairly and transparently.

• Send an update to the client periodically to let them know how many hours they’ve used, and when they might be due for a top up.

Pro tip: Adjust your rates for different tasks. For example, as a designer, you may charge more for concepting vs. execution or artworking.

It’s time to move beyond the hourly rate

Freelancing isn’t a one-size-fits-all career, and your pricing shouldn’t be either. By mixing and matching these methods, you can diversify your income streams, adapt to different clients and projects, and focus on delivering value rather than just trading time for money.

So, what’s your next step? Start experimenting with these pricing strategies, and watch how they not only increase your earning potential but also transform your relationship with work and clients.

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