Every consultant I know has the same secret: they picked their rate out of thin air, felt guilty about it, then lowered it.
The Number You Won't Say Out Loud
Here's an exercise. Think of your current rate. Now double it. Feel that knot in your stomach? That's the anxiety tax. It's the discount you apply to your own expertise because charging what you're actually worth makes you physically uncomfortable.
The anxiety tax is real and it's expensive. I've watched brilliant strategists charge $150/hour for work that transforms companies worth hundreds of millions. They know their impact. They just can't bring themselves to price for it.
Why You Underprice (And It's Not What You Think)
Most pricing advice focuses on "market rates" and "competitive positioning." That's a distraction. The real reasons consultants underprice are psychological, not economic.
Fear of rejection. You'd rather close 10 projects at $5K than risk losing one at $50K. Except the math on that is terrible — and the clients at $5K are almost always harder to work with.
Imposter syndrome in a trench coat. You compare yourself to the most visible people in your industry and assume they know something you don't. They don't. They're just more comfortable with big numbers.
The "I used to have a salary" anchor. Former employees calculate their rate by dividing their old salary by 2,080 hours, then adding a small margin. This ignores that roughly half your time is unbillable, you're paying your own taxes, and you're carrying all the risk. Your rate should be 3-4x your equivalent hourly salary. Minimum.
The Clients You Attract at Low Prices
Here's something nobody tells you: cheap clients are more demanding than expensive ones.
A client paying $5,000 will ask for unlimited revisions, email you on weekends, and question every decision. A client paying $50,000 trusts your expertise, respects your time, and lets you do the work they hired you to do.
This isn't a coincidence. Price signals competence. When you charge premium rates, clients treat you like a premium partner. When you charge bargain rates, they treat you like a vendor they're doing a favor.
How to Actually Raise Your Prices
1. Stop Quoting Hourly
Hourly pricing punishes you for being good at your job. The faster you solve problems, the less you earn. Switch to project-based or value-based pricing. Charge for outcomes, not time.
2. Raise Prices for New Clients First
You don't have to renegotiate existing contracts tomorrow. Start by quoting your new rate to every new prospect. If nobody flinches, you're still too cheap.
3. Use the "Wince Test"
Name your price. If the client doesn't wince even slightly, you left money on the table. You want a brief pause — a moment of consideration — followed by a yes. That's the sweet spot.
4. Detach Your Identity from the Number
Your rate isn't a measure of your worth as a human. It's a business decision. The person on the other side of the table sets their prices strategically too. Match their energy.
The Real Cost of Underpricing
Underpricing doesn't just hurt your bank account. It warps your entire business. You take on too many clients to make the math work. Quality drops. You burn out. You start resenting the work you used to love.
And here's the cruel irony — the market reads your low prices as low quality. You're literally paying the anxiety tax twice: once in lost revenue, and again in the perception that you're not worth more.
The Takeaway
Your pricing is a story you tell the market about your value. Right now, most of you are telling a story that dramatically undersells the impact you deliver.
Double your rate. Lose a few prospects. Keep the ones who get it. Watch your business transform.
The only thing standing between you and better pricing is a feeling. And feelings are a terrible CFO.