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I have been working for different companies but now that i need some more money i want to try freelance. I do not know how much to charge for this.

I got a project that requires me to create a website which will interact with an api. I have to do all the backend and frontend pages. They are pushing requirements as i am working and the project has very tight limit.

How much should i charge for a project like this?

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First of all, the client and you need to decide whether payment should be fixed price or hourly rate.

Clients automatically tend to prefer fixed price - but you should only accept this if the requirements are also fixed or you have performed similar tasks so often that you are aware of the actual work load.

Freelancers tend to prefer an hourly rate to avoid being 'guilted' into doing free work at the later stages of a fixed price project.

In addition, an hourly rate means the client will always evaluate whether they actually need a specific feature, whereas they under a fixed price often will try to extract as much work from you as possible until you draw the line.

What your actual hourly rate should be, depends on your circumstances - but you obviously need to get paid more than a similar full-time employee.

If I have to estimate the price for a fixed price project, I take my hourly rate and multiply it by the time I believe it takes - and then multiply it by a 'risk factor'. You should tell the client that a fixed price comes at this premium - as that can often nudge them towards accepting a pay-as-you-go hourly rate (if that is what you prefer).

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Your rate should be something you are comfortable with. This means the following:

  • You believe you are adding value at this rate for your client.
  • You can cover all your costs:
    • Cost of working
    • Insurance
    • Build up reserves for periods of less work
    • Build up for your pension
    • etc.
  • You make enough profit for you to justify your time and choice

This is expressed into an hourly rate and the amount of hours you expect to work paid. You have to determine these two variables.

After this you make these calculation you have to make the specific calculations for the job offered by your client. This was quite well answered by @morsor. A hourly rate is less risky, but a fixed price is usually a calculation of how many hours you expected to spend plus risk margin times your hourly rate.

Having an hourly rate does not imply that you do not work all hours that a client asks. A principal of maximizing value for your client should be first. This means sometimes advising a client not to spend money by letting you work on something. For a long term client this will greatly increase trust and future work.

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It sounds to me like you haven't decided if you wanna go per-hour or fixed price costs. You should really make that decision before the project starts. If this is a one shot deal and don't know the employer you can guage the project and decide if you need it to be fixed price or not. If you know this employer and are expecting to get more work and consider the work more important than the way you get paid then probably a combination of per-hour and fixed price would do the trick. For example, if the employer had you start doing the work and you didn't make payment plans then you can do milestone fixed price (say, when you finish the first part of the project) and then in your project management mindset you would re-evaluate if you want to continue fixed cost or per-hour. Let's say the employer wants to continue fidgeting with the first milestone after that milestone has been completed then per-hour would be appropriate.
Bottom line: sit down and think about it for yourself because your employer will plan things to work out for his own benefit so make sure you do the same.

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