Why Freelancers Underprice Their Services
It's easy to look at a ₹50,000 project fee and think it's a great deal. However, traditional hourly calculations often ignore the reality of running a freelance business. When you account for non-billable hours (like client communication and administrative tasks), software subscriptions, and self-employment taxes, your actual take-home pay is significantly lower.
How to Price Freelance Projects Correctly
- Factor in Non-Billable Time: Add at least 20% to your estimated hours for "scope creep" and communication.
- Account for Taxes Upfront: Depending on your jurisdiction (e.g., Section 44ADA in India, or 1099 taxes in the US), set aside a realistic tax percentage immediately.
- Include Direct Expenses: If a project requires premium stock photos, a specific software subscription, or hiring a subcontractor, that comes out of your bottom line.
Use our free Freelance Real Hourly Rate Calculator before sending your next proposal to ensure you are meeting your baseline financial goals.