LegalPracticeTools

Practice Pricing Calculator

Price a fixed fee from loaded cost, a risk buffer and a target margin, with the overrun headroom stated explicitly.

Last reviewed

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Free · No sign-up · Runs in your browser

Fixed-fee pricing fails when it is derived from the hourly rate card. A rate card is a selling price built on assumptions about utilisation and leakage; using it as a cost base produces a fee that is either uncompetitive or, once discounted to win the work, unprofitable.

This calculator prices from loaded cost, adds a buffer for the matters that overrun, and applies the margin you want. The output that matters most is the headroom - how far the matter can run over before the fee stops covering cost.

Your numbers

Results update as you type. Nothing is sent anywhere.

Result

Fixed fee

$6,503

Overrun headroom

28

Base cost
$3,110
Risk buffer
$467
Gross profit
$2,926
Margin achieved
45%
Implied hourly rate
$295.58
Break-even hours
50

This tool performs arithmetic on the values you enter. It does not provide legal advice and does not create an attorney-client relationship.

The headroom figure is the point of a flat fee: it shows how far the matter can overrun before the fee stops covering cost.

Cost per hour means your loaded cost - salary, benefits and overhead divided by realistic working hours - not the rate you charge.

How to use the practice pricing calculator

  1. Enter the hours the matter is expected to take.
  2. Enter your loaded cost per hour, not the rate card.
  3. Add expenses and set a risk buffer sized to the predictability of the work.
  4. Set the target margin and read the fee and the headroom.

What people use this for

  • Setting a price for a repeatable matter type.
  • Testing whether a fee a client proposed is viable.
  • Understanding how much overrun a fee can absorb before it loses money.
  • Building a fixed-fee menu for a practice.

Worked examples

Every figure below is produced by running this calculator against the example inputs, so the numbers always match the tool.

A predictable matter type

22 hours at a $130 loaded cost, $250 of expenses, a 15% buffer and a 45% target margin.

Fixed fee
$6,503
Overrun headroom
28
Implied hourly rate
$295.58

A less predictable one

The same work with a 40% buffer to reflect real uncertainty.

Fixed fee
$7,916
Overrun headroom
38.9
Break-even hours
60.9

Loaded cost, not the rate card

Loaded cost is what an hour of that person’s time costs the practice: compensation, employment costs, and a share of rent, technology, insurance and support, divided by realistically billable hours.

It is typically a third to a half of the rate card. Pricing a fixed fee from the rate card instead is the most common error, and it makes the margin calculation meaningless because the "cost" already contains the margin.

Headroom is the number to check before agreeing

A fixed fee moves overrun risk from the client to the practice, and that is only sustainable if the price contains enough buffer that a normal overrun does not eliminate the margin.

If the headroom figure shows the matter can only overrun by an hour or two before losing money, the fee is too tight for anything but the most predictable work. Either raise the buffer or decline the fixed fee.

Methodology and assumptions

What this calculator does, and what it deliberately does not do.

  • Base cost = hours × loaded cost per hour, plus expenses. The risk buffer is applied to that base.
  • The fee is set so the target margin is achieved on the buffered cost.
  • Break-even hours divide the fee by loaded cost per hour; headroom is that figure minus the estimated hours.
  • The tool performs arithmetic or date counting on the values you enter. It does not interpret a rule, a statute or a contract.
  • Nothing you type is transmitted or stored - the calculation runs entirely inside your browser.

This website provides general informational and productivity tools and does not provide legal advice or create an attorney-client relationship.

The date and deadline tools count days exactly as you instruct them. They do not interpret court rules, statutes of limitation, filing requirements or any other legal authority, and they do not know the rules of your jurisdiction.

Always verify any date, fee, or calculation against the governing rule, the court calendar and your own professional judgement. If you need legal advice, consult a lawyer licensed in your jurisdiction.

Frequently asked questions

How do I work out loaded cost per hour?

Total annual cost of the person including a share of overhead, divided by the hours they realistically bill. For a solo practice, use total practice cost divided by your own billable hours.

What buffer is appropriate?

It scales with how well you know the matter type. Repeatable work with a defined scope needs little; anything depending on a third party needs considerably more.

Are fixed fees more profitable than hourly?

On predictable work, usually - efficiency gains stay with the practice rather than reducing the bill. On unpredictable work they can lose badly.

Should the fee include disbursements?

Either way, provided the engagement letter is explicit. Excluding them avoids the fee moving with costs you do not control.

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