On pricing and life goals

The following is an excerpt from Confessions of a Six-Figure Coach- a book by me! If you want to get on the list to be notified when the book comes out, pop your details in the box at the bottom of the page.

How much are you worth?

Like, if you had to put a price on your head. Say you were being held hostage. How much would a savvy hostage-taker ask for you?

If that question stumps you and/or makes you uncomfortable, then this is for you my friend.

Because every day that you're in business, you absolutely have to tell people what your expertise is worth. With a NUMBER.

Sound scary? A little "working woman-ish?" A question you'd really rather not answer?

Get ready to own it, love, because you and your worth are intrinsically tied together and a price tag is a part of that. Your number doesn't define you, but it is important to know it. Whatever your number is.

Take out a sheet of paper right now. You’ll want to see it in writing.
Write down your worth. With a dollar sign and commas and zeros.
Now divide that number by 365. You might need a calculator for that.
Divide that number by 8.
Put a dollar sign in front of that last number.

Here's what my numbers looked like the first time I did this exercise.

I wrote down $10,000,000.

Ten MILLION dollars! Yes, I also did the Dr. Evil pinky to mouth thing as I wrote this. And said it out loud.

Ok, 10 mil divided by 365 is 27,397.26.

Then 27,397.26 divided by 8 is 3424.66.

Then I pop a dollar sign in front of it and I get $3424.66.

Ostensibly this is my hourly rate if I assume an annual worth of $10 million. Pretty simple right?

That doesn't necessarily mean that I CHARGE that much per hour of my time right now. But what it does do for me is start to give me some context.

For instance, if I say that I want to make $10 million in a year, now I know how many hours of how many days I'd need to work doing dollars-for-hours stuff in order to hit that goal.

If nothing else, this example really hits home the benefits of leverage because I know that I do not want to work eight hours a day every day of the year even if I am making $3k an hour.

More importantly, this exercise is about opening up to the idea of what is possible.

Let's do it another way.

Imagine you just want to hit the $100,000 mark in annual revenue. (Yes, I know- so cliche but it IS a nice round number.)

Now decide how many days per week you want to work. My ideal would be three. But for this example's sake, let's say it's four days per week with four weeks of vacation per year. That means four days times 48 weeks.

So you'll work a total of 192 days. Assuming you work for six hours each day, that’s a total of 1152 billable hours per year. $100,000 divided by 1152 means you need to be charging at least $86 dollars per hour to hit 100k in annual revenue.

Does that sound like too little to you too? Or perhaps too many billable hours? I thought so!

If you want to do it on your own follow these steps:

Decide how much you want to make. Write it down.
Decide how many weeks of vacation you would like.
Multiply the number of weeks of vacation by 7.
Subtract that number from 365.
Write here the number of days you have available to work.

, you'll know that you'll spend a ton of time doing things other than coaching or providing your service/product. That means you'll want to account for roughly half your time as "unpaid" or non-billable time.

Let's do that caclulation again. That would mean you'd do billable work for about three hours each day of those 192 days.

That means your billable hourly rate will be $173.60 and you'll make your $100,000/year goal if you coach/consult for three hours of each working day, not including vacations.

Simple, right?

And to get to $200k? Just double that hourly rate.

I find this a really useful exercise to figure out how much work I'll need to be doing and at what kinds of rates in order to achieve the financial goals I have.

Fortunately, too, we have so many opportunities for leverage via group coaching, higher paying contracts (corporate is great for these), speaking, and info products.

Hopefully our little math lesson helps you see what is possible for you.

One big caveat. It takes TIME to get to a full practice. You might not hit it in the first three months, six months or even year, depending of course on your market and on your sales skills.

Still, you have to start somewhere. And knowing where you want to go is a huge part of your beginning steps.