Retainer pricing

Worked example

20 hours x $100 = $2,000, less a 10% discount: a $1,800 monthly retainer ($21,600 a year). You expect to work 17 hours, so the effective rate is $1,800 / 17 = $105.88 and you are $100 a month ahead of billing 17 hours hourly. The break-even is 1,800 / 100 = 18 hours: past that, you earn less than your standard rate.

How it works

A retainer trades a discount for predictable income. The risk is scope: if the client uses more hours than you priced, the effective rate falls; if they use fewer, it rises. Write the included hours, the overage rate and what happens to unused hours into the agreement.

The discount is your choice. This tool does not assume a typical retainer discount.

Sources and basis (checked 2026-10-08): arithmetic on the numbers you enter. No published rates, tax rules or benchmarks are built in; any figure described as a rule of thumb is labelled as one. This is a planning estimate, not financial, tax or legal advice.

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FAQ

How do I price a monthly retainer?

Multiply the hours included each month by your hourly rate, then apply any discount you offer for the guaranteed income. 20 hours at $100 with 10% off is $1,800.

Should a retainer cost less than hourly billing?

That is a business choice. A discount rewards a commitment, but it lowers your rate if the client uses all the hours. At a 10% discount and 20 hours used your effective rate is $90.

What happens to unused hours?

Decide in the agreement: expire at month end, roll over for a limit, or be billed anyway. The rate you earn depends on it.

What is the break-even number of hours?

The retainer divided by your standard rate. Above it you earn less than your standard rate. In the example that is 18 hours.