Freelancer Tips

Four consequences of setting your freelancing rates too low

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When I first started freelancing, I thought my rates were good. I was getting clients, but I noticed that I wasn’t being trusted and respected at the level I deserved. I quickly learned that even though I thought I had set them appropriately… they were too freakin’ low! Oooopsie.

Setting your rates too low is a mistake that can have serious consequences. In this post, I’ll explain why you should never set your rates too low, and what the repercussions are if you do.

Clients will assume you’re not an expert.

You should never, ever undersell your skills. And by “never,” I mean “never.” Even when you’re just starting out as a freelancer and every dollar counts, don’t sell yourself short with lowball pricing.

Why? Because clients might assume you’re an amateur… even if you aren’t. If you want to build strong working relationships with clients and get repeat business, it’s important to set rates at a level where people will see you as an expert in your field.

Low rates can imply that you don’t value yourself (so why should others?)

And even if you don’t feel like an expert yet (and who does?), there is an unfortunate reality: if clients discover that their potential new hire is charging less than someone else—even if those two prices are somewhat comparable—they’ll begin to wonder what kind of service they’ll be getting from this person who doesn’t seem as confident about their skill set.

As a freelancer, it’s important to create a healthy, respectful working relationship with your clients so that you can be sure they’ll value and respect your work. If you’re too open about setting low rates for yourself, that could imply that you don’t value yourself (so why should others?) and will lead to problems down the line.

Some of the ways this might manifest include:

  • Clients may not take boundaries seriously. They might ask for more work than originally negotiated (for the same fee), they might ignore your communication boundaries, they might expect you to drop everything for them, heck, they may even go as far as ignoring those boundaries altogether!
  • As a result of you not valuing yourself and your work, your clients may feel like they can’t trust you, which means they may not give you the proper level of autonomy you deserve, and need, to be able to do your work. There’s nothing worse than having a client who thinks they can do your job better than you.

Your low rates will impact other freelancers and your industry.

You have to consider the big picture when you’re thinking about how much you should charge. How your rates impact others and the industry as a whole is a major factor in determining what you should charge.

When you’re just starting out, it’s absolutely natural to want to offer your services at the lowest rate possible so that clients will book you instead of someone else.

And it might work—at least at first. But over time, It’s impossible for everyone to be underpricing their services in your industry because then nobody would be able to make enough money from their businesses to truly survive without burning out. So if you can’t set your rates higher for you, at least do it for others.

It can make it difficult to raise them to where they need to be.

If you charge a low fee, the only way to increase your income is by… yep, raising your rates. And if you’ve set them too low to begin with, it’s only a matter of time that you’re going to need to do this.

There’s a good chance that when you finally raise your rates—which have been lagging far behind market value due both to inexperience and lack of confidence—you’ll either feel like you still can’t raise them at once to where they actually need to be, or if you do raise them by a huge amount at once, you risk losing current clients.

Starting out with higher fees makes it easier for you (and others)


I know, I know. It’s tempting to set your rates low just so that you can start to get clients. But the truth is that it’s actually much better to start out with higher fees, and then raise them by smaller increments over time. Or.. the alternative is that your rates will always be too low, which means you won’t be making enough money, which means you’ll be prone to being seen as an amateur and/or burning out. So as challenging as it is, I encourage you to set them fairly now, so it doesn’t become a headache later. You’ve got this.

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Hi, I'm Caley.
Your Soul Sister + New Business Coach.

I knew I wanted to work for myself since the age of four. Yep, I'm serious. However, I didn't take the leap into full-time self-employment until I was 27. It's now five years since then, and I haven't looked back once. I've served clients across the globe, providing winning digital advertising, e-commerce strategy, email marketing, photography, and more. And now it's time for me to pass this knowledge on to you.

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