The surprising insights going from $20/hr to $3,000/hr

Stephanie's question is on how to raise her rates. I give you the word-for-word script, and a much deeper strategy.

Ramit Sethi

Coin Tower

I used to get really weird reactions when I would quote my hourly consulting rate — and it was only $20 back then.

Fast forward to the last time I did consulting, when I quoted my hourly rate of $3,000, and I got barely a raised eyebrow.

How did I go from $20 to $3,000/hour in a few years?

People always think it’s some fancy script on raising rates. I’m actually going to give you a word-for-word script you can use right here in this post.

But it’s actually much deeper than that.

This is what the GIMME THE CRUNCHY TACTICS!!! people miss. They genuinely believe if they discover the “right” words, they can “convince” someone to part with their money. But they miss a much deeper strategy.

(Btw, candidly, most people will not be able to charge this amount. It is a ridiculous amount and we all know it. It just happens that I have a few esoteric skills that are highly valued by business people. In truth, I wish they would pay me the same for my extensive knowledge of ironing shirts and habanero salsa, but the market is the market.)

More importantly, it’s about a deeper strategy of being an ADVISOR rather than trying to extract every little bit of money from the people you’re trying to serve.

See, you can go from $20 to $50/hour with a little work. It’s actually not that hard.

But to really move into the next level — into the $100/hour, or $250/hour, or even $1,000/hour stratosphere — you have to take an entirely different approach.

Many of my students have begun this ascent. The best part is, as they move their rates up, they’re forced to deliver increasing value to their clients. Win win.

Today’s question is from Stephanie, a tutor who wants to know how to raise her rates, even when it may mean saying “no” to parents of a struggling child. I’ll give you the word-for-word script, but I’ll show you a deeper strategy that helps put your client at the center of your world — instead of trying to make a quick buck.

Take a look:

LEAVE A COMMENT: Share an example where you COULD give someone advice that would hurt you in the short term…but benefit you BOTH in the long term. It could be with money, relationships, health, whatever.

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  1. CL

    The new IWT version of the Marie Forleo video!

    • Qaadira

      Yes, and I love it!

  2. J

    Here is an example of my current supervisor, an academic, who recently did this and I guarantee it will pay off for him in the end.

    He has some funds for having me stay with him, but not enough for me to make a sustainable living. It just so happens, that a company that I applied for a position at, asked him to come in and consult for them. He said, “Yes” but only if I could come along, which allowed me to meet more people within the organization in a role which allowed me to highlight my talents and qualifications in the role of an experienced adviser which can only help the application process if I decide it is a good opportunity.

    Regardless, I will never forget how my supervisor put my needs above trying to extract another 6 months of work out of me. Regardless of what position I take, my supervisor has guaranteed that he will have access to a highly qualified professional for life.

  3. Tyler Huff


    just as a general ‘CreativeLive’ comment. THANK YOU for this wonderful surprise. When you first sent the notification a week or two about this CreativeLive event, I thought it would be just a 20 minute live interview. I was confused why it was Wed – Fri. When I saw that it was 9am – 4pm, and was an entire 3 full day seminars of Ramit’s top stuff. I was FLOORED at the opportunity to hear for FREE 21 hours of Ramit’s talks. This was such a rare opportunity given your hourly rate, the fact that you rarely do seminars and to have this amazing access was such a gift. I have followed you for years. Read the IWT book and finally you earned my $ when I purchased the no stress negotiation technique. I am in the process of it now and hearing this 3 day class, while some of it is repetition to your long term readers, is still fresh and unique to see in a full day seminar format.

    THANK YOU. And w00t on hotel in-mirror televisions!

    Tyler Huff
    San Diego, CA

  4. Tanya Malott

    I just had to laugh at this phrase in your newsletter, “My goal is to earn my way into your inbox every day by making my free stuff better than anyone else’s paid stuff.” LMAO! Uh, my (virtual) friend, you did that a YEAR AGO!

    I can’t even bring myself to delete your emails that are irrelevant to me (about jobs/raises/salary negotiation….because I am self employed already). I save EVERYTHING you send, even if I can’t read it at the time, because if I ever want to learn something new/original/different, it is probably in one of your letters. Plus, your writing is so darn GREAT, your thinking is so ORIGINAL, and your video presentation is simply riveting. You make me laugh and think all at the same time. THAT is your gift!

    Only 2 people have this status in my inbox (the “I am afraid NOT to read this” status. You and Derek. The rest come and go. Most go.

    So, thank you! You have earned your way into my inbox forever.


  5. PointSpecial

    I WISH that I had given my friend the advice not to marry the woman he was engaged to… She was the type of girl you date (if you’re into that sort of stuff) but not the type of girl you marry.

    I balked at the chance… and before they’d gotten two years in, they were already divorced.

    That advice could have certainly strained our friendship for the short-term but it also could have potentially prevented him from making a decision that is still haunting him 4 years later and has made him a much more jaded person.

    • Jon

      It is great to give people specific advice, but I also think it is important not to try to control the person’s decisions. Present the information in the most logical way possible (be honest about what you see), and then let the other person make their decision. Even if that person ends up doing their own thing anyway, it’s nothing personal. Every man has to make their own decision.

  6. Kim

    I have been watching you on Creative Live the past few days and LOVE the info you are giving us! Thank You! Straight forward and I am looking forward to putting it into action! I will give you the reviews…….


  7. Sudan

    Hey Ramit!
    I truly love your writing style. It cuts like a knife but even feels alright. There is only Derek sivers whose writing i keep on waiting like yours. Others come and go. Like you say, Yes! your free stuffs are much worthy than other peoples paid stuff. Keep up the good job and rock the world that cares about you.

  8. Steven D.

    Any situation where you point out that the Emperor’s New Clothes…aren’t…is probably a prime example of taking action which hurts you in the short term, but helps all parties involved immensely in the long term.

    It could be explaining, politely but frankly, to a colleague or manager that a given idea might not work quite as its currently set up; it could be a (good) career counselor explaining that based on previous academic performance and ability that for a student to choose Career X might set him or herself up for failure (unless their performance changes dramatically and tangibly in the near future), etc.

    All these situations could result in (very) bad blood in the near term, but represent an act of tremendous courage, honesty, and moral integrity on the part of the observer to undertake, and ultimately give the receiving party an invaluable piece of constructive criticism which could benefit their personal development significantly down the road.

  9. Cherleen @ My Personal Finance Journey

    Great post. I have been with a client for more than a year and I would like to ask for an increase. I would also like to try your suggested script. I hope that it will also work for me. Thanks for sharing!

  10. Jon

    I had a situation years ago where i was considering having someone take over the payments of my mortgage in a ‘deed-in-lieu’ arrangement with a complete stranger. I didn’t want the house anymore and I was tempted to sign over the deed or some contract that did some kind of quick claim deed for the property. I told my father this and be went all out to talk me OUT of the deal. He insisted that no one, even your best friend, would pay my mortage before they pay their own house payments; the risk was too high. I finally agreed and instead gave the house back to the bank in exchange for mortgage cancellation and no late payments on my credit report. That worked out quite well and it was completely transparent.

    Ramit wrote an article about the pitfalls of buying real estate as a primary residence, especially at a young age.

  11. Caleb Page

    I like the points you make about raising your rates. One of the areas where I meet resistance is helping employees feel confident in supporting rate increases. It’s as if they are worried about appearing to ask for more when the reality is we are undercharging. Has anyone had experience in implementing increases through a small team? I’d love to hear some successful examples!

  12. Susan

    First, thanks for your wonderful CreativeLIVE program. It was incredible! I was going to watch for free, then bought it after only an hour of watching–it was that good!

    The situation where I had to say “No,” even though if I could have worked it out, it would have been win-win.

    I thought it would be a great experience for my kids to have high school exchange students live with us throughout the years. 99% of the time it was fabulous–a wonderful cultural exchange for all (not to mention free language lessons!).

    Then came a male student from Uzbekistan. He came at a time my husband was gone most of the time, so the student had myself, my teenage daughter, and my 8 year old daughter at home. After a week, I realized:

    1) This student was not the student who took the English proficiency test required to participate in this exchange. (Luckily, we had enough Russian, a Russian/English dictionary, and a tiny bit of Arabic for bare-bones communication.)
    2) The student knew nothing about the history of his own country–not the Silk Road, Tamerlane, nothing. I tried to teach him, but he dissed my info as being from a woman, and therefore, must be both wrong and useless.
    3) The student professed to be Muslim, but wouldn’t go to the nearest mosque for worship because it was full of African Americans and (worst of all–WOMEN). I bought him a prayer rug, used a compass to prove where the East was from his bedroom, and offered to work with him on passages from my copy of the Koran (I have always been interested in other religions, so have a number of different religious texts). He refused everything and his grasp of the history and practices of his professed religion were nil as far as I could discern.
    4) The student got into violent trouble at school daily, and finally said he would blow up everyone (pre-9/11). No matter what I said or did, nor what the school said or did, this behavior seemed unchangeable.
    5) Teachers called daily because the student was failing every class (because he didn’t understand English). I would get yelled at to make him improve. While I was picking up more phrases in his language, he learned no English.
    5) The student would go wherever he wanted, whenever he wanted, and refused to inform me where he was or when he’d be back. It disrupted all our family plans for meals, outings, music lessons, etc. (We are rural, so I had to be available to get him and bring him home whenever/wherever he popped up.) My requests to be updated on his whereabouts were completely ignored.
    6) I sought counseling from the exchange support group to help me better work with this student, stating that the violence had to stop immediately, and that the student had to agree to try learning rudimentary English and follow a few basic rules or he would need to find another home. I was willing to change anything I could to help him succeed at our home.
    7) After counseling the student several times over the next 5 weeks (the exchange group said I didn’t need the counseling), the counselor decided the best solution was to move the student into a home with a retired widower. They concluded he would never take direction from any female and that, indeed, he spoke no English.
    8) The student (son of a high-ranking official) was eventually sent home.

    I felt awful I had to say no to having him live with us for the entire year, but I couldn’t go on any longer without the stress affecting my health, not to mention my family. (His stay was the longest 6 weeks of our lives.)

    Happily, we went back to accepting other exchange students without any problems at all. The “no” still haunts me, though. I still feel if I was smart enough, I could have figured out how to make things work.

  13. Stephanie B


    I was surprised to see my questions answered with a video response, so thanks for this info that can be applied to SO many situations.

    I know at face value, the advice on your site is about how to become rich, but deep down, it IS about serving people and seeing those results, whether it’s in tutoring, in consulting, or any work someone puts in.

    People who are successful, in my mind, see the results, measure them, and in return earn a compensation that comes in non-monetary forms- spiritual and emotional satisfaction. In my mind, this is a more sustainable motivation for one’s work.

    Too bad spiritual and emotional rewards do not pay the bills! Fortunately, I have the advice of people like you to help me learn how to earn my living! 🙂

    This video really got me thinking about the WHY of my yearning for earning. I’ll follow up with an email with a few more questions about some of the things I wonder about when it comes to this whole “serving” concept.


  14. Teresa

    Hi Ramit, I’ve just watched your seminar on creativelive yesterday and wanted to buy your book. Is there any chance it will be translated in Italian?
    I understand English pretty well but I’d be glad to focus on the tasks to accomplish more than on understanding the language.

    Thank you for the amazing free contents you’re providing,

  15. Shawn Hill

    Great information. I love how it always starts with confidence and not an apology. I think that builds credibility in the customers eyes. Nothing works every time all the time, but I think this is a great way to handle it.

  16. Jan Easter

    Hello Ramit,
    I have been looking for places to thank you for your amazing 3 days at Creative Live. I am very grateful for your time, and have already ordered the book and been applying your ideas. My husband and I have been all over your website. I also sent out a massive email blast to my family members and friends to watch you. My mom is even watching the rewatch so that she can be part of our strategy! I will keep you posted and hopefully, mine and my family`s will be examples of some of your greatest success in the NEAR future.

  17. Lucy Ra

    Next year I plan on taking additional training to move from a 200 hour to a 500 certified yoga teacher. This video just showed me how not to make it awkward when it’ll come to updating my rates and notifying my clients. Thanks!

    In the meantime I’ll continue adding value by utilizing my knowledge of anatomy and nutrition to help clients (esp. the ones with injuries and past surgeries).

  18. Kevin

    Man, I just had to say that the creative live sessions were amazing. I learned soooooooo much.

    And as a 20 yo I am eager to start investing my money. I just stopped by to say thanks a lot

  19. Stuart

    Good God! Can you imagine that rate? imagine working just 5 hours a day with that?

  20. Camilla

    Hey Ramit,
    I used this script (a version thereof) today to double my rates with a client. I’m at the point where I’m so in demand now, I can afford to lose a few clients who don’t want to front up the cash for quality writing. Turned out the client didn’t go with me for both the jobs (I thought she was going to freak out, but she responded really professionally and respectfully – awesome!). She also seemed very appreciate of me suggesting I’d help her find someone else who could do the job for less (followed the script closely there) and she still wanted me for the other 1.5K job I’d quoted on. I used your tip of adding value by throwing in optimisation of their web copy as a complimentary inclusion, valued at $2,000 [positioned this as saying so many clients need it now and when they come back and ask me to optimise it after the event, it costs them 2K – so by doing it upfront, I’m keeping my clients’ aims in mind AND saving them a potential 2K]. I’ve been doing all this kind of stuff for a while (I’m a copywriter after all), but your vid just reiterated how crystal clear I need to be about showing my clients EXACTLY where the value is. A sincere thanks – it worked a treat. 🙂

  21. Sunil @ CPA Career Success

    very interesting in that effectively hourly rates can certainly be improvised, especially in professions like mine (Accounting, CPA) that are conducive to it and automatically lend itself to the market.

    as Lucy pointed out there is a certain element of perceived “guilt”. we each need to learn how to overcome that and move on. we are worth what we think we are.

    great discussion

  22. dsebd

    RAMIT SETHI, you are an amazing asian person and I believe you are proud to be an Indian. I live in Bangladesh and I am 27 years old. I am also trying to be rich and earn like you but opportunity is not same here. But I believe if I work smartly, then I might be rich like you! Thanks for this wonderful article.

  23. mercadeo

    The government is scrutinizing the finances of 15,000 Greeks to see if they have stashed money abroad — about $5 billion in all over the last three years — to avoid paying taxes.