How to Price a Freelance Project: Fixed-Price vs Hourly, Milestones, and Quoting Without Underbidding

Pricing is the part of bidding most freelancers rush. The brief looks clear, the client looks genuine, and the temptation is to type in a low number just to win the work. That number then follows you through the whole project: every extra revision, every unclear requirement, every hour over your estimate comes out of the same fixed pot — minus the platform fee.

This guide shows how to price a freelance project on Freelancer.com properly: when fixed-price beats hourly (and when it does not), how to work out the lowest rate you can afford, how the platform fee changes your quote, and how to split the price into milestones so you are never working unpaid. The quote itself goes into your bid, so it also helps to know how to bid on freelance projects as a whole — the proposal around the number matters as much as the number. All fee figures come from Freelancer.com's own fees page, checked at the time of writing.

Fixed-price vs hourly: how Freelancer.com actually works

Freelancer.com projects come in two pricing models, and the client chooses which one when posting. You bid inside the model they chose, so the first pricing decision is understanding what each model means for you.

Fixed-price projects

You agree one amount for a defined set of deliverables — a logo, a landing page, a 2,000-word article. Payment runs through Freelancer.com's Milestone Payment system: the client deposits funds into a milestone before work begins, the money is held securely by the platform, and it is released to you only when the client approves the completed work. You can request a milestone before you start, and you should never begin substantive work until the first milestone is funded. If the delivered work is not approved, the client can request revisions or use the dispute resolution process.

Hourly projects

You are paid by the hour for work tracked through the Freelancer Desktop App, which logs your hours and takes screenshots of your work. You agree a weekly hour limit with the client, track your time in the app, and the tracked hours are invoiced weekly and paid through a milestone. Hourly suits work where the scope will change as you go — maintenance, ongoing support, open-ended research — because you are paid for the time you actually spend rather than a guess made upfront.

A quick comparison

Which model fits which project?

Use fixed-price when you can describe the finished work in a sentence and list what is included: a five-page website, a logo with three concepts, a data-cleaning job with a defined output file. Use hourly when the honest answer to "how long will this take?" is "it depends" — debugging someone else's code, ongoing content work, or a project where the client will keep adding requirements.

If a fixed-price brief is vague, that is a pricing problem, not just a scoping problem. Either pin the scope down in chat before you bid, or treat the vagueness as a reason to bid hourly if the client will switch models — or to walk away. Analysing the brief before you bid is what makes an honest quote possible.

Work out your floor rate before you quote anything

Before you look at what anyone else charges, work out the lowest rate you can afford. The method is simple:

1. Add up your monthly costs — rent, software, internet, tax set aside, and the income you need to live on.
2. Estimate your realistic billable hours per month. Not 160 — most freelancers bill 60 to 100 hours once admin, bidding, and gaps between projects are counted. Use your own honest number.
3. Divide costs by billable hours. That is your floor hourly rate: below it, you are losing money by working.

As an illustrative example only: monthly costs of $1,500 divided by 80 billable hours gives a floor of about $19 per hour. That figure is before the platform fee — and before any allowance for holidays, sick days, or unpaid time between projects. Your real floor is higher than the first number you calculate, which is exactly why so many freelancers discover too late that a "won" project paid less than a part-time job.

Your floor is private. It is not your quote — it is the line below which you decline, however attractive the project looks.

The 10% project fee — and why your quote must cover it

Freelancer.com charges freelancers a project fee of 10% on fixed-price projects (or $5, whichever is greater) and 10% on hourly projects. The employer pays a separate fee of 3% (or $3 minimum on fixed-price projects), which does not come out of your payment. Check the fees page yourself before quoting, because fee schedules can change.

The practical consequence: a $500 quote is not $500 of income. At 10%, the fee is $50 and you keep $450. A $100 quote keeps $90. And a $40 quote keeps $35, because the $5 minimum fee applies — 12.5%, not 10%. Small jobs carry a proportionally heavier fee, which is one more reason to think twice before bidding low on small fixed-price work.

So quote backwards from what you need to keep. If you need $450 for a job, the quote must be $500, not $450. If your floor rate says a task is worth $60 of your time, quote $67 to keep $60 after the fee. This is the single most common pricing error on the platform: quoting the amount you want to earn, then watching a tenth of it disappear.

How to quote a fixed-price project

1. Put the scope in writing. Before you bid, agree what "done" means: deliverables, formats, number of revisions, and what is explicitly out of scope. Vague scope is how a $300 job becomes a $300 job plus three extra rounds of work.
2. Price the whole job, then split it into milestones. A common pattern is a deposit to start, a payment at the midpoint, and a final payment on handover — for example 30% upfront, 40% at the first approved draft, 30% on delivery. The exact split is negotiable; the principle is not: you should never be more than one milestone away from being paid.
3. Ask for the first milestone to be funded before you start. The Milestone Payment system exists for this. A client who will not fund the first milestone is telling you something about how the rest of the project will go. Our guide to checking a client's payment verification before bidding explains what else to look for.
4. State the revision limit in your proposal. Two revision rounds included, further changes quoted separately. This turns scope creep into a paid conversation instead of free work.
5. Price change requests as you go. When the client asks for something outside the agreed scope, quote it before doing it — a short message with the extra cost and the extra time. Agreeing first keeps the relationship friendly and the project profitable.

How to quote an hourly project

1. Agree the rate and the weekly hour cap before you start. The cap protects the client from surprise bills and protects you from an expectation of unlimited availability.
2. Track every hour in the Freelancer Desktop App. Untracked hours are, for payment purposes, hours you did not work. Keep the app running while you work and review your logged hours before the weekly invoice is generated.
3. Report progress weekly, in writing. A short note — what was done, what is next, how many hours were used — prevents the end-of-project surprise where a client questions hours they never saw accumulating.
4. Renegotiate the cap, not the rate, when scope grows. If the work needs more hours than agreed, raise the cap with the client's agreement. Cutting your rate to fit a budget is the wrong lever.

Five ways freelancers underbid — and how to stop

• Racing to the lowest number. The cheapest bid does not win the best clients; it wins the clients who will also be the hardest to satisfy. Bid on fit and quality, and let the cheapest bidder have the projects that only compete on price.
• Forgetting the fee. Quoting your take-home figure as the bid price, as shown above, silently hands 10% of your income to the platform.
• Pricing the brief, not the job. A brief that says "simple website" can hide ten pages, a contact form, and three rounds of design changes. Analyse the brief properly first, then price what the work actually involves.
• Unlimited revisions. "Revisions until you're happy" is an open-ended commitment priced as a fixed fee. Always cap revisions in the proposal.
• Starting before the milestone is funded. Work done before funding exists is a favour, not a contract. If the client disappears, you have no milestone to claim against.

Raising your rates without losing work

Rates rarely jump; they climb. Raise them in small steps — 10 to 15% at a time — and apply the new rate to new clients first, so your existing relationships are not disrupted overnight. Each rate rise should be paired with something the client can see: a stronger portfolio piece, a faster turnaround, a review that mentions quality. If a regular client questions the rise, explain what has changed — your experience, your demand, the results you deliver — rather than apologising for it. Some clients will leave. The ones who stay are the ones your business is built on.

What pricing can't fix

A good price does not rescue a bad project. If the client has no payment history, the brief is contradictory, or the budget cannot cover the scope at any rate you can accept, the correct price is no price at all — decline the project. Pricing also cannot guarantee income: rates vary by skill, market, and demand, and Freelancer.com's fees and rules can change, so re-check the fees page whenever you are quoting after a gap. What pricing can do is make sure the work you do win pays what it is worth.

Frequently asked questions

Should I charge fixed-price or hourly as a beginner?

Fixed-price is usually easier to quote when the scope is small and clear, because both sides know the total cost upfront. Hourly is safer when the work is open-ended. Beginners often do better starting with small fixed-price projects, where the risk of a misjudged estimate is limited to one job.

How much should I charge for my first project on Freelancer.com?

Charge your floor rate, worked out from your costs — not the lowest number you think will win. Early reviews matter, but a project that pays below your costs buys a review with your own money. If you want to build reviews, do it with small, well-priced jobs rather than large, under-priced ones.

What is a milestone payment on Freelancer.com?

A milestone payment is a sum the client deposits into the platform's Milestone Payment system for a defined piece of work. The funds are held securely until the client releases them after approving the work. For fixed-price projects, milestones split the total price into stages; for hourly projects, tracked hours are paid through milestones on a weekly cycle.

Does Freelancer.com charge freelancers a fee?

Yes. Freelancers pay a project fee of 10% on fixed-price projects (or $5, whichever is greater) and 10% on hourly projects, according to Freelancer.com's fees page. Employers pay a separate 3% fee. Always check the fees page before quoting, as figures can change.

Your next move

Price one real project this week using the method above: work out your floor, add the fee back in, split the quote into milestones, and write the scope into your proposal before you bid. Then check that the projects you are bidding on are actually worth your time — your monthly bid budget is limited, so spend it on work priced to pay. If you use BidMasterPro, set a minimum budget filter so under-priced projects never reach your queue in the first place.