How Much Money Can I Make by Doing Fractional Work?

This article is meant to show what is possible, not what will automatically happen.

NOTE: If you’re looking for a more in-depth breakdown of how much money you can make doing fractional work, check out our Playbook here. This article serves as more of a high-level guide.

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What Fractional Compensation Usually Looks Like

Fractional leaders are typically paid through monthly retainers, hourly billing, or a combination of base pay and incentives. Monthly retainers are the most common structure because they provide clarity around scope and predictability for both sides. For more details on this, read here.

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Rule of Thumb to Calculate Your Hourly Rate

One rule of thumb is to take your most recent full time base salary, remove the last three zeros, and use that number as an approximate hourly rate. For example, someone earning $180,000 in a full-time role might start around $180 per hour. This is not a guaranteed rate, but should be treated more like a goal, something that you can eventually attain as you start building your fractional practice.

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Monthly Retainers and Stacking Clients

A common monthly retainer structure might involve committing to around 10 hours per week for a single client at a fixed monthly rate. Most fractionals will work anywhere between 5-30 hours per week for a single client. Over time, some fractionals will stack on a second, third, or even more clients at different levels of time commitments.

This ability to stack multiple part-time engagements is what creates higher income potential, but it is important not to overcommit to work you don’t have time for.

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What Realistic Income Ranges Look Like

Imagine your target hourly rate is $200 / hr. This would equate to a roughly $8,000 monthly retainer for a 10 hr per week commitment.

Although there are 40 hours in a “work week”, don’t make the mistake of thinking that all your working hours will be billable. You need to spend time managing the back-office of your business, as well as on finding new business.

It’s most common to spend about 25 or 30 hours of your week on client work.

So that might look like picking up two monthly retainers of $8,000 at 10 hours per week each. And then, perhaps picking up a third retainer, or a 5 hour per week engagement, or even a couple of 2 hour per week advisory engagements.

In this example, monthly income might look like $8K + $8K + $4K = $20K / month.

As you do great work, you can start to increase your rates and retainers, and as you get more efficient you might be able to start taking on more work. Both of these serve to increase your monthly income.

It is not uncommon for experienced fractional leaders to be making 50%+ more than what they were making in their previous full-time job.

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In Summary

Fractional work offers the chance to take control of how you spend your time and skills to earn the highest income possible. It can be demanding and unpredictable at times, but for many people that tradeoff is worth it.

You might earn a few thousand dollars per month to start. You might eventually replace a full time salary. With experience, positioning, and the right clients, some people go on to earn more than they ever did in traditional roles. None of these outcomes are guaranteed, but they are possible.

For more details about how compensation varies by role, seniority, and commitment, take a look at our Playbook “How Much Money Can I Make as a Fractional Employee?”

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