When to Raise Your Freelance Rates (And How to Do It)
Signs it's time to increase your rates, how much to raise them, and scripts for telling existing clients. Stop undercharging for your work.
Cash Flow Forecaster Team
Personal Finance Experts
Most freelancers wait too long to raise their rates. They fear losing clients, feel uncomfortable asking for more money, or simply don't realize they're undercharging.
Here's the truth: if you've never had a client say no to your rates, they're too low.
5 Signs It's Time to Raise Your Rates
You're fully booked
If you're turning away clients, your rates are too low. High demand = raise prices.
You haven't raised rates in 12+ months
Inflation alone means your effective rate drops ~3-4% per year. Annual increases are normal.
Your skills have improved significantly
New certifications, tools, or experience should translate to higher rates.
Competitors charge more for similar work
Research market rates. If you're below average, you're leaving money on the table.
You resent the work
Feeling underpaid leads to burnout and poor work. Rates affect your motivation.
How Much Should You Raise Rates?
The answer depends on your situation:
The 10% Test
If you're unsure how much to raise rates, start with 10%. If no clients push back, you probably could have gone higher. Use this feedback to calibrate future increases.
How to Tell Existing Clients
This is the part that scares people. Here's a simple framework:
- Give advance notice (30-60 days minimum)
- Be direct, not apologetic
- Explain the value, not the reason you need more money
- Offer a transition if appropriate
Email Template: Rate Increase
Hi [Client Name],
I wanted to give you advance notice that my rates will be increasing starting [Date - 30-60 days out].
My new rate for [service] will be [New Rate]. This reflects [brief reason - expanded skills, market alignment, increased demand, etc.].
I've really enjoyed working with you on [specific project or ongoing work], and I look forward to continuing to deliver great results.
If you'd like to lock in work at the current rate, I'm happy to discuss prepaying for upcoming projects before [Date].
Let me know if you have any questions.
Best,
[Your Name]
For New Clients
Raising rates for new clients is easier—just update your proposals and quotes. No explanation needed. You can even raise rates for new clients before existing clients to test the market.
What If Clients Push Back?
Some will. That's actually healthy. If no one ever pushes back, you're undercharging.
Here's how to handle common objections:
"We can't afford that increase."
Offer to reduce scope instead of price. "I understand. We could adjust the scope to [specific reduction] to stay within your budget."
"Other freelancers charge less."
Don't compete on price. "I understand there are cheaper options. My rates reflect the quality and reliability I provide. I'm happy to recommend alternatives if budget is the priority."
"Can you make an exception for us?"
Only if there's a real reason (long-term contract, referrals, interesting work). Otherwise: "I apply rates consistently across all clients to be fair."
When to Apply New Rates
- New clients: Immediately
- Existing clients (project-based): Next project
- Existing clients (retainer): Give 30-60 days notice, apply at next renewal
Don't Raise Rates Mid-Project
Honor existing agreements. If you quoted $5,000 for a project, don't ask for $6,000 halfway through. Raise rates for the next project instead.
The Impact on Your Cash Flow
A 15% rate increase doesn't mean 15% more income—it could mean much more. If you're currently working 40 billable hours/week at $75/hour and raise to $86/hour:
Or, you could work fewer hours for the same income—giving you time back for business development, skills training, or life outside work.
Key Takeaways
- Raise rates annually at minimum—inflation erodes your effective rate
- Being fully booked is a clear signal to raise prices
- Give existing clients 30-60 days notice
- Be direct, not apologetic—you're providing value
- Some pushback is healthy—if everyone says yes, rates are too low
See How Rate Changes Affect Your Cash Flow
Use Cash Flow Forecaster to model how a rate increase would impact your income over the next 3, 6, or 12 months—before you make the change.
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