How to know how much to charge?
Hey guys!
How do I know how much to charge? I get this question all the time, ask myself this question all the time haha, and the truth is that the answer is fairly complicated. There are a number of different variables that go into calculating a final rate, package, fee, etc.
Here are some things to consider courtesy of Stephen Fishman, J.D. over at nolo.com:
Calculate Your Hourly Rate
Business schools teach a standard formula for determining an hourly rate: Add up your labor and overhead costs, add the profit you want to earn, then divide the total by your hours worked. This is the minimum you must charge to pay your expenses, pay yourself a salary, and earn a profit. Depending on market conditions, you may be able to charge more for your services -- or you might have to get by on less.
Determine your annual salary. To determine how much your labor is worth, pick a figure for your annual salary. This can be what you earned for doing similar work when you were an employee, what other employees earn for similar work, or how much you'd like to earn (as long as your goal is reasonable).
Compute annual overheard. Next, compute your annual overhead. Overhead includes all of the costs you incur to do business -- for example:
- telephone expenses
- office equipment and furniture
- rent and utilities
- stationery and supplies
- postage and delivery costs
- clerical help
- business insurance
- business-related meals and entertainment
- travel expenses
- professional association memberships
- legal and accounting fees, and
- advertising and marketing costs -- for example, the cost of a yellow pages ad, website, or brochure.
Overhead also includes the cost of your fringe benefits, such as medical insurance... read the rest of his article here.
There's a sweet spot for most things, and I'd like to think that time, prayer and dedication to ironing out processes are keys to finding it!
Enjoy the journey, and more importantly, don't be afraid to go for whatever it is you envision for yourself!
I'll leave you guys with a quote from Brene Brown that I shared on Instagram earlier this week:
Choose growth 🙏🏾❤️ // When we choose growth over perfection, we immediately increase our shame resilience. Improvement is a far more realistic goal than perfection. Merely letting go of unattainable goals makes us less susceptible to shame. When we believe “we must be this” we ignore who or what we actually are, our capacity and our limitations. We start from the image of perfection, and of course, from perfection there is nowhere to go but down. -#BreneBrown
Peace, Love & Sunshine -Chels