How to Work Out Your Freelance Day Rate Without Underselling Yourself
Knowing what to charge as a freelancer can feel like a guessing game. But it doesn’t need to be. Setting your day rate is about more than just picking a number that sounds right — it’s about understanding your worth, your running costs, and what kind of freelance life you want to build.
Here’s a clear breakdown to help you calculate a rate that reflects your skills and supports your goals.
Set Your Income Goal For The Year
Start by thinking about what you need to earn in a year to live comfortably. Then add a buffer for savings, time off, or future investments in your work. Once you have that figure, work backwards.
If you want to earn £45,000 a year, and you plan to work around 46 weeks a year (giving yourself six weeks for holidays and downtime), that gives you 230 potential workdays. But not all of those will be billable.
A realistic benchmark is that around 60 percent of your time will be billable once you factor in admin, business development, and creative downtime. That gives you about 138 earning days.
So:
- £45,000 divided by 138 days = roughly £326 per day
This is your baseline. It’s what you need to earn per day to reach your goal.
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Factor In Business Expenses
Freelancers don’t just earn money, they run businesses. That means covering costs like software subscriptions, insurance, travel, marketing, gear, studio space and even tax. If you don’t include these in your rate, you’ll end up eating into your take-home pay.
Let’s say you spend £5,000 a year on expenses. Add this to your £45,000 income target, and your new total becomes £50,000. Now divide that by your 138 billable days and your day rate becomes about £362.
That figure better reflects the real cost of freelancing, not just your ideal salary.
Choose The Right Pricing Model For Each Project
There are different ways to charge for your work, and your rate can vary depending on which one you use.
- Day rate: Best for ongoing work, retainer clients or on-site freelance gigs. Make sure the client understands what a day includes.
- Project rate: Works well when you can clearly define the deliverables. Clients like the certainty, and you get paid for the outcome rather than the hours.
- Hourly rate: Useful for small jobs or ad hoc tasks, but less ideal if you work quickly or bring a lot of experience.
- Value-based pricing: Great for more strategic work where the outcome has a measurable impact. It requires confidence and clear communication of value.
For example, an editor might charge by the hour for proofreading, but quote a project fee for a full video edit. A designer creating a brand identity for a start-up might charge based on the impact and scope, not just time spent.
Use Your Last Full-Time Salary As a Benchmark
If you’ve recently left a full-time role, your old salary can help guide your starting rate. Take your annual salary, including benefits, and divide by the number of working days in a year. Then increase it to reflect the freelance risk and flexibility.
For Example:
- £35,000 salary divided by 230 days = £152 per day
- Add 50 percent for freelance overheads = £228 per day starting point
This is just a ballpark figure, but it helps ground your pricing in something tangible.
Know What Others Are Charging
Take time to research what similar freelancers charge. You can ask peers, look on platforms like Upwork or Fiverr, or check industry surveys.
As A General Guide:
- Junior freelancers might charge between £150 and £250 per day
- Mid-level professionals often charge £250 to £400
- Senior specialists can charge £400 to £600 or more
You might charge more for in-demand skills, or for sectors with higher budgets like advertising or tech.
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Adjust Your Rate Based On Project Complexity
Not all jobs are equal. A fast-turnaround brief with tight deadlines, lots of client contact, or complex requirements may justify a higher rate.
You Should Consider:
- Charging extra for weekend or evening work
- Adding a premium for rush jobs or last-minute bookings
- Offering discounts for long-term or high-volume projects
For example, a podcast producer might charge more for a branded series with multiple stakeholders than for a single-episode edit for an indie creator.
Stay Flexible Without Undercutting Yourself
It helps to have a rate range rather than a single fixed price. Set a standard day rate, a lower threshold you won’t go below, and a premium rate for high-value work.
If a project aligns with your values, gives you great exposure or helps you build a new skill, you might consider being flexible.
But don’t make it a habit to lower your prices. A fair rate helps attract serious clients who respect your work.
Remember Your Lifestyle Plays A Part
One of the best things about freelancing is flexibility. You might only want to work four days a week, take regular breaks, or spend more time on your personal projects. Just make sure your rates reflect that.
If you’re not working full-time hours, you need to charge more per day to meet your income target. Otherwise, you risk earning less than you need to sustain yourself and your business.
Think About How You Package Your Rates
Confidence matters. When you present your rate, do it with clarity and professionalism. You don’t have to apologise or over-explain. If you’re pitching a project, show what’s included and why it’s priced the way it is.
Consider Offering:
- A clear breakdown of deliverables
- A choice of two or three pricing tiers
- Optional extras or add-ons
This gives clients a sense of control and makes your rate feel considered, not random.
Review And Raise Your Rates
Your rate should evolve as your skills, experience and demand grow. If you’re constantly booked up or getting strong referrals, it may be time to increase your rate.
Check in with your numbers every six to twelve months. Are you meeting your goals? Are you covering your expenses comfortably? Are you being paid what you’re worth?
Raising your rate doesn’t need to be dramatic. You could start by increasing it slightly for new clients, or by updating your packages and scope. Small, consistent changes are easier to manage, and they build your confidence as you go
IYour day rate is one of the most powerful tools in your freelance toolkit. It’s not just about money. It’s about valuing your time, your expertise and the life you’re building. Use this guide as a starting point, test what works for you, and adjust as you grow.
There’s no single magic number - but there is a sweet spot that works for your business, your lifestyle and your goals.
How to get covered
We make it easy. At Mode, we work specifically with freelancers, creative professionals, and small businesses - so our cover is built with your world in mind. You can speak to a real person, tailor your policy to fit your needs, and make changes as your work evolves.
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Explore our other blogs for tips on insurance essentials for freelancers, or get in touch if you’d like to chat through your options. No jargon. No hard sell.
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Any views or opinions expressed above are for guidance only and are expressed in generic terms. They are not intended as a substitute for readers taking appropriate professional advice relevant to individual circumstances.
Written by
Josh Dumelow
Marketing & Insights Associate
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