An honest approach to billing

I am taking a big step here and being as transparent as I can. This might be a first in this industry, but I want my clients to understand how their money is spent.

I decided to take this step after thinking through all possible pros/cons. What pushed me over the edge was the fact that there are some companies embracing transparency and they are doing just fine. The tipping point for me was when Buffer published their pricing breakdown so I decided to do the same.

Below is my current rate and a breakdown of how each hour I bill is spent.


There are a lot of responses on Quora about how much to charge and there are many formulas that people use and in my case I decided to lay it all out there, which is basically exposing all the costs associated with running the business and my personal life. So here is the breakdown:

Costs of doing business

  • Taxes $16.45
  • Tools $0.53
  • Education $0.53
  • Hosting $0.18
  • Software $1.40
  • Internet $1.05
  • Invoice/Accounting $0.18
  • Hardware $1.05
  • Marketing $3.50
  • Office $1.75

Costs of living

  • Insurance (Health, Car, etc) $2.63
  • Self-Employment Tax $5.25
  • Mortgage/Rent $11.90
  • House Expenses $4.03
  • Unexpected Expenses $2.45
  • Bills $4.55
  • Retirement $3.85
  • Savings $6.30

Miscellaneous Costs

  • Vacation $0.88
  • Sick Days $1.05
  • Holidays $0.53
  • Bonus $0.00

A few more things

These are my numbers and they are all based on me working several projects for several different clients. I have made arrangements where my billable hours are more predictable, as in retainers and medium to long-term contracts. When I get into these situations I can adjust my rate as these contracts allow me to remove some of the risk I carry when working on smaller projects.

From time to time I also have to contract out work that I cannot do myself. I work with a great group of people and I trust them to do their absolute best. I am subject to their rates and depending on their skills, their rate might be much higher or lower than my rate.

On a final note, along with having to handle all expenses of running the business, I also have to account for periods of no work. I am not working a full 2080 hours a year and the hourly rate pricing takes and all non-billable time into consideration.

Still interested? Awesome! Contact me.