Search
Close this search box.
Blog » Business Tips » How to Stop Undercharging Clients Once and For All

How to Stop Undercharging Clients Once and For All

spreadsheet

Finding out too late that you’ve undercharged for work is disheartening. The story often ends with you doing a considerable amount of work for free or less than what your effort is worth.

A habit of undercharging will undoubtedly lead to burnout and can even put you out of business.

Here are a few ways to avoid undercharging for your work:

 

Draft Your Proposal… And Then Come Back to It Later

I always tend to leave money on the table whenever I give a quote to a client “off the cuff.”

It’s very easy to underestimate the full scope of an entire project when you don’t give yourself some time to consider all variables of the job.

After experiencing one too many occasions where I felt undercompensated for work, I made it a rule to think about quotes over a few days before sending them out.

To avoid undercharging, always sleep on your proposals to give yourself enough time to decide what compensation will be appropriate for your effort.

 

Don’t Be Afraid to Ask

One of the most valuable things I did to get myself out of an undercharging cycle is asking other business owners how much they charge for similar services.

Build relationships with other service providers you can trust. Ask their opinion before deciding what to charge whenever you’re unsure.

If you haven’t yet established relationships with other business owners, Facebook groups and forums are a place where you can meet people and ask advice.

Many websites also publish research on average pricing for different industries.

For example, writers can check out the How Much Should I Charge report from Writer’s Market. And Skillcrush even has a post on how much to charge for web design services.

 

Calculate Your Hourly Rate Meticulously

You should calculate how much you’re getting paid per hour regularly to make sure your time is always properly compensated.

You may think you’re charging a decent amount for your work (especially when first starting out) only to discover your hourly rate is less than expected.

Sure, charging someone $500 for a project sounds great. But if after doing the math you realize the project takes you 20 hours you may want to reconsider what you’re charging.

Before you get stuck being overworked and underpaid, decide how much income you want to make per month. Then break that amount down into an hourly rate. Keep this rate in mind when setting your project prices.

Also, remember to take into consideration taxes and business expenses.

 

Final Word

Undercharging for client work can leave you feeling defeated.

You commit to doing great work, and it’s a real challenge for your mindset and finances when you aren’t getting paid well for it.

Make adjustments right away whenever you feel like your pricing strategy is leaving you vulnerable.

All clients who I ask to give me some time to think about pricing have been understanding.

The extra time gives me an opportunity to ask for advice, to seek out pricing suggestions from other resources, and to calculate a project price that will pay me appropriately per hour.

About Due’s Editorial Process

We uphold a strict editorial policy that focuses on factual accuracy, relevance, and impartiality. Our content, created by leading finance and industry experts, is reviewed by a team of seasoned editors to ensure compliance with the highest standards in reporting and publishing.

TAGS
Personal Finance Writer
Taylor K. Gordon is a personal finance writer and founder of Tay Talks Money, a personal finance and productivity blog on hacking your way to a happier savings account. Taylor has contributed to MagnifyMoney, The Huffington Post, GoGirl Finance, Madame Noire, and The Write Life.

About Due

Due makes it easier to retire on your terms. We give you a realistic view on exactly where you’re at financially so when you retire you know how much money you’ll get each month. Get started today.

Categories

Top Trending Posts

Due Fact-Checking Standards and Processes

To ensure we’re putting out the highest content standards, we sought out the help of certified financial experts and accredited individuals to verify our advice. We also rely on them for the most up to date information and data to make sure our in-depth research has the facts right, for today… Not yesterday. Our financial expert review board allows our readers to not only trust the information they are reading but to act on it as well. Most of our authors are CFP (Certified Financial Planners) or CRPC (Chartered Retirement Planning Counselor) certified and all have college degrees. Learn more about annuities, retirement advice and take the correct steps towards financial freedom and knowing exactly where you stand today. Learn everything about our top-notch financial expert reviews below… Learn More