As a freelancer, pricing is the #1 lever for profitability. Charge too little and you burn out. Charge too much and you lose clients. Here's a simple framework I use to consistently hit 35-50% profit margins.
Step 1: Know Your Costs
Most freelancers only track their hourly rate. But your true cost includes overhead: software subscriptions (e.g. $20/month for Figma), hardware depreciation, health insurance, taxes (self-employment tax is ~15%), and non-billable time (admin, sales, accounting).
Step 2: Set a Target Margin
I aim for 40% profit on every project. That means for every $100 I charge, $40 is profit after all costs. Use this formula: Target Price = Total Cost / (1 - Desired Margin).
Step 3: Use a Calculator
I built a free Google Sheets template to do this automatically. You enter your costs and desired margin — it spits out the price. It also tracks multiple projects so you can see which clients are most profitable.
Get the Free Template
Download the Freelance Profit Margin Calculator (Google Sheets) here: https://microtoolsb2b.gumroad.com/l/Freelance-Project-Profit-Margin-Tracker-Google-Sheets
It's completely free, pre-filled with sample data, and ready to use. No sign-up required.
Happy pricing! 🚀
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