Set Your Billing Rate to $10,000 per Hour.

Steve Pavlina  has an interesting take on hourly billing:

The big problem is that when you tell yourself your time is worth $50/hour, you’re simultaneously telling yourself that it isn’t worth $75/hour or $200/hour or $10,000/hour. You’re programming your subconscious mind to limit the range of opportunities you will notice. Because you won’t be on the lookout for $10,000/hour ideas, you’ll overlook them completely. If you tell yourself you earn $50/hour, you’ll think in terms of $50/hour opportunities.

Thinking in terms of an hourly rate may help limit your downside, but it also severely limits your upside. And that’s a really bad trade-off, bad enough that it requires me to dismiss this whole paradigm as utterly stupid. There’s no way the upside of turning some $20 hours into $50 hours can compensate for missing those $10,000 hours. That’s penny-wise, pound-foolish.

One $10,000 hour is worth 200 $50 hours. That’s more than a month of full-time work! You don’t need too many of those huge payoff hours to pick up the slack of some of those less productive $0-20 hours, but if you miss out on even one of those $10,000 hours, it’s a crippling blow that overwhelms all other thoughts about financial productivity.

In the long run, your greatest financial risk isn’t whether you made the mistake of succumbing to doing $20/hour work when you could have done $50/hour work. Your greatest risk is missing those $10,000 hours. And most people miss out on them completely. It’s ironic that people think of being a salaried employee as being low-risk and being an entrepreneur as high-risk. The reality is just the opposite. One of the reasons I chose the entrepreneurial path is that it’s just way too damn risky to be an employee. I’m not kidding. It’s easy to hit a good number of those $10,000 hours as an entrepreneur, but it’s a lot harder to do so as an employee.

How many $10,000 hours did you enjoy this year?

Go ahead and read the whole post.  Really thought provoking.

Comments

[Dave!]

I don't tell myself I'm worth any hourly rate; I let the market tell me what I'm worth. So far, I'm pretty happy with the results. :)

[Brent Williams]

I couldn't agree more.