This retainer calculator prices a monthly retainer from your hourly rate, the hours included and a commitment discount. It shows the value of those hours at standard rates, the client saving, your effective rate and the total contract value.
The formula
standard value = hourly rate x hours included per month
monthly retainer = standard value x (1 - retainer discount %)
client savings = standard value - monthly retainer
effective rate = monthly retainer / hours included
contract value = monthly retainer x contract months
If the included hours are zero, the effective rate is 0.
Worked example
Inputs: rate $90, 20 hours per month, discount 10%, contract 6 months.
- Standard value: $1,800.00
- Monthly retainer: $1,620.00
- Client saves per month: $180.00
- Effective hourly rate: $81.00
- Contract value: $9,720.00
How to read the result
The retainer trades a lower rate for steady income and planning certainty. The client gets priority and a lower price.
- Compare the effective rate with your minimum rate from the freelance rate calculator.
- Define the scope and the hours in writing. Unclear scope turns a retainer into unpaid work.
- State the notice period for ending or changing the retainer.
- Bill the retainer in advance if your contract allows it.
Tax treatment of advance payments differs by country. Check with a tax authority or an accountant.
Related tools
- Create the document: Invoice generator and Quote generator
- Read more: Retainer agreements and Recurring invoices
- Other calculators: Billable hours calculator and Freelance rate calculator
Frequently asked questions
- How do I price a monthly retainer?
- Multiply your hourly rate by the hours you include each month. Then apply a discount if the client commits for a fixed term. The result is the monthly retainer fee.
- Should I discount a retainer?
- A discount rewards a firm commitment and gives you steady income. It is optional. Keep it small enough that the effective rate still covers your costs. Set it to zero to bill the full rate.
- What happens to unused hours?
- The calculator does not model this. Your agreement should say whether unused hours expire, roll over or are refunded. Write the rule into the contract.
- What is the effective hourly rate?
- It is the monthly retainer divided by the included hours. It is lower than your standard rate when you give a discount. Make sure it stays above your minimum rate.
- What is contract value?
- It is the monthly retainer times the contract length in months. It shows the income you expect if the client stays for the full term.