It’s 2023, writer: Do you know where your rate is?
If it’s still at the same level it was a few days ago in 2022, you’re cheating yourself.
I mentioned this several times over the last year: I spent 2021 undercharging (and overworking) and lost a shit-ton of money as a result. In fact, had I been charging what I should have, I’d have earned $85,500 more.
That’s a big loss.
[bctt tweet=”How much money are you losing by not raising your #freelancewriting rate?” username=”LoriWidmer”]
Ah, but you’re scared. You have clients you’d like to keep. You don’t want to chase them away.
I get it. I was there once, too. I can’t promise you that raising your rates won’t chase off a client. I can promise you this, though:
When you raise your rates, you’ll attract bigger spenders.
It seems counterintuitive, doesn’t it? However, it bears true so often that I’ve come to trust the logic. Higher-end clients (meaning those with deeper pockets) will do business more readily with contractors who charge professional rates.
I’ve told this story before, so forgive the repetition.
A friend of mine once worked for a global corporation. They needed a writer for a one-time project. My friend contacted me and I sent over my rate — $95 an hour. I was so pleased with myself for going higher than the $90 an hour I was charging. That pleasure lasted until she called about ten minutes later.
“About your rate — you meant to charge $125 an hour, didn’t you?” she said.
“Huh?”
“I’m pointing out that you meant to charge $125 an hour, right?”
“Uh, right?”
She told me later that her company was getting all sorts of bids regularly from contractors and they routinely tossed out those bids that were too low. Keep that in mind when you raise your rates.
And you should raise them. Without knowing what you charge now, I’d bet it’s less than what you should be charging.
But what should you be charging? That’s the eternal question, isn’t it?
While what you charge is going to based on all sorts of criteria, let’s try to narrow it down for you.
Your rate should consider the following things:
- Your time in freelancing: I tend to think this doesn’t weigh as heavily as the expertise you bring to the gig, but it does stand to reason that a new freelancer won’t be charging a $200/hour consulting fee. Then again, there are exceptions, such as a scientist-turned-writer whose expertise is going to demand that kind of rate.
- Your expertise: Specialists and generalists alike build expert skills in topic areas, but more importantly, they build business acumen and marketing savvy. Those are soft skills that are worth quite a lot to a client who needs marketing writing, but who doesn’t want to put something out there that’s going to embarrass or ruin the company’s reputation. Those skills are valuable.
- How long you’ve been at the current rate: This is a big one. If you’re sitting at the same rate for more than a year, you’re undercharging. Guaranteed.
- Your salary expectations: Honey, this counts a lot. Imagine you as an employee — you wouldn’t work for someone who wasn’t paying what you’d like to be paid, right? You would go for the job paying $80K a year over the one paying $50K a year. Why should freelance writing be any different? What do you want to make annually? That’s the basis for setting your rate.
If you’ve been online anywhere you’ve seen writers struggling after four years, seven years, ten years. Why? Because they’re not moving beyond their comfortable rut, most likely. It’s easier to camp out on job sites like Fiverr instead of building a more active marketing approach.
But writers need other things, too. They need to build value.
That’s our next post. Stay tuned.
Writer, when was the last time you raised your rate?
Do you feel you’re charging the right price? On what criteria are you basing that assertion?
6 responses to “Freelance Rates: Where Should Yours Be?”
“Yes!” to raising rates in the new year, especially for those who haven’t in a while.
A big problem I see with those struggling after years of freelancing is they never quite understood the difference between freelance pay and traditional salaries / hourly pay. Last time I dug into the details (accounting for the increased tax payments, benefits, etc.), you had to charge 30-40% more as a freelancer to truly earn an equivalent amount to what employers spend per-employee in the same role. And that still doesn’t account for earning more to cover new business expenses. It can be a shock to the system if they haven’t accounted for things like that.
It’s a common mistake many freelancers make, Jenn. They are charging like an employee. However, when they realize they need to save for retirement (and there’s no company match in freelancing), lose pay on sick days and vacation time, possibly fund their own healthcare (if there’s no employee-spouse/partner), they come to realize just how little they’re charging.
But they’re not doing that math and that’s a big problem. The SBA has an article up from three years ago that gives a decent overview of what employers pay. https://www.sba.gov/blog/how-much-does-employee-cost-you
That’s a big one. I cringe any time I see a freelancer say freelancing doesn’t have paid vacations or sick days. It’s like “you sound like an awful boss; why do you even want to work for you??” LOL It does (or should) pay for that and so much more. If it doesn’t, it’s because you made a mistake when setting your rates. Thankfully, you can always re-work that math! 🙂
I haven’t looked at it in a while, but salary.com used to be good for this too. You could look up specific job titles and locations to see not just salaries but the full cost of each employee with insurance, taxes, benefits, etc. Tempted to poke around there again soon to see if that 30-40% range still holds up.
[…] Would you be happier with fewer clients and charging higher freelance writing rates, and how might current clients adapt if you go that route (or will you lose them)? (For more on rates, check out Lori Widmer’s recent post on where your freelance writing rates should be.) […]
A couple years ago a would-be client insisted on knowing my hourly rate. I told her I prefer per-project rates, since both parties know what the total will be from the get go. I told her I tend to work quickly, so hourly rates would penalize me while rewarding slower workers. She said that couldn’t happen because they “cap” how many hours each project can take (which is another infuriating issue fro another day.)
I got the vibe that no matter how little someone charged per hour it would still be more than she wanted to pay. I had nothing to lose, right? So I pulled numbers from thin air – numbers that would be fair to almost any client but her. I think I said $125 or $150 per hour, with minimum of $250 per assignment. SILENCE. She was shocked.
She meekly said they pay $25/hour. I said that’s a modest hourly rate for an employee, but wouldn’t begin to cover my overheard, then launched into a mini-discourse on some of the points Jenn mentioned above.
I’ll need to keep that link to the SBA handy for the next time I encounter someone like this.
Worse yet: I later spoke with a freelancer who had worked for this woman’s PR company. That writer said the hours allotted per project were never enough. She managed to get their rate up to $37.50/hour, but said it still wasn’t worth the time and effort.
Now every time I see ads or social media posts from that company, I can only think of how unprofessionally they treat the freelancers who do much of their award-winning work.
Hi Paula, sorry I missed this. WOW. That’s a big pay discrepancy! Even at the $37.50 the other freelancer was able to squeeze out of her, that woman will never pay enough. That’s not a job for serious freelancers. It just can’t be. You cannot make a living at those rates.
That’s the part that really bugs me. How can some of these household-name companies and publications pay such garbage? They’re making money or they’re damn good at faking their success. No thanks. Give me the client who values my skills. I won’t waste time with the cheapskates.