How increasing your rates affects earnings

Have you ever stopped to think about how your consulting fees affect your earnings? A while ago, I asked "How often do you increase your rates?" I mentioned that, if you increased your fees by 5% a year for 10 years, you could go from $50 an hour to $81.

How does that affect your annual earnings? Let’s say you were billing 20 hours a week for 48 weeks a year. So you started at $48,000 a year. And you increased your rate at 5% a year. Now you’d be earning $77,000 a year — for working the same number of hours.

And what if you’d increased your rate 6% a year? Now you’d be earning about $86,000 a year. (And you would have enjoyed thousands in increased earnings over the years.)

Have you been afraid to raise your consulting fees? Stop leaving money on the table!

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