From $25/hour to $185/hour – Part 1 – Setting up for success

SOB FacultyPractice Development2 Comments

Confidence is 90% of the battle.

When I started out I charged $25/hour because I had the confidence that I could charge that all day and no one could ever complain. I was also happy to make that much. At the time I was employed at a CPA firm making about $40,000 per year and I had figured out that $25/hour translate to approx. $50,000 per year. The math is simple, if you are working a 40 hour week and all of that is billable then it’s 40x52x25 = 52,000. Compared to $40,000 this was a nice increase in pay so I was grateful to be able to earn it.

Gratitude is also 90% of the battle

When I am grateful to have the work then I am highly motivated, not just to do it, but to be the most amazing person I can be at getting it done and doing it well. With this kind of motivation I don’t need to think about it. I will go way above and beyond because I will be excited to see the client’s reaction when I present them with the results of my work and go way above and beyond their expectations.

Now let’s talk about the rate again. Are you excited to get paid what you are charging? Are you grateful to get paid that kind of money? If not, then you’re not charging enough. It’s time to raise your rates. There’s an art to this. You have to hit that sweet spot where you are charging enough that you can’t wait to get to work because you can’t get over how well you are getting paid, especially when you love what you are doing, balanced with feeling confident enough to charge that rate. You have to believe so firmly that you deserve – that you are worth more than what you are charging.

Let me share a quick story with you.

The Tiki Shark Story

https://www.tikishark.com/

When you stand by your rate, it builds the prospect/client’s confidence in you

They responded to an ad I had placed on Craigslist. This was back when Craigslist was still a viable place to market your business. Prior to my initial meeting with them I told them my rate was $40/hour. In the initial meeting the owner asked if there was any flexibility on that. I explained that there wasn’t because I was already keeping very busy at $40/hour. He later admitted to me that when he went back to his partner he told him that I “must be very good because I wasn’t willing to budge on my rate.”

Even if you lose the prospect because they can’t afford you (or they don’t value what you offer properly) you leave the door open for the next client who will come in the door and only be too happy to pay you the rate you want. I can also promise you THAT client will be much more enjoyable to work with because they DO value your services.

A week or so into the work I was doing for Tiki Shark the owner wanted to know how it was going. I had taken the work home with me. I explained that I was still working on it, entering the bills and applying payments that were made and such. He started asking me questions about how much certain vendor balances were etc.. I sent him a report and the client panicked. He did not know me well yet. I had to remember this as I calmed him down and told him I needed more time because it was incomplete. If I wasn’t confident in my work, I probably would have lost this client right here.

A month or so later as I was in the Tiki Shark office (then on Hollywood Blvd in Hollywood, CA) I was fine tuning some of the numbers, crossing T’s and dotting I’s so to speak and I noticed some minor differences. The owner asked me if I, “..have ever been fired for being too accurate?” Of course I laughed and said this would be a first.

Eventually these guys moved to Hawaii. I still check in with them from time to time.

There are a few messages here:

  • If you are confident in the rate you charge, your client will be more confident in you – they will respect it when you don’t second guess yourself – even if they ask you to.
  • The client who doesn’t want to pay you what you know you’re worth, isn’t worth your time.
  • You have to be confident in your work. Remember YOU are the expert. That’s why they hired you. You have to lead and guide them to the solution.

In Part 2 we’re going to look at “The Sheer Numbers – what you charge and what you can make.”

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2 Comments on “From $25/hour to $185/hour – Part 1 – Setting up for success”

  1. Is $25/hr fair for someone who went through the first school of bookkeeping course and is still learning? Do you recommend insurance? You mentioned craigslist “used to be” a viable place- do you not recommend it anymore?

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