“How much should I charge for my freelance writing services?” I hear this question all the time. Unfortunately, while there’s a lot of information out there on setting freelance writing fees, much of it is incomplete. There’s no magic answer – no one can give you a set dollar amount to charge for a specific freelance writing service. At best, when people try, they’re only offering a guide – something to take into consideration based on surveys of what other writers are earning. These writers may or may not be in the same boat as you professionally. Rather than hoping someone can tell you what to charge for your writing services, you instead need to think about the process of setting rates – it’s possible for every freelancer to set the right rates early on, and it doesn’t have to be difficult.
The Biggest Mistake in Setting Freelance Writing Fees
One common thing I hear people telling new writers is that they have to price their services low in the beginning, and slowly increase their rates. That’s not even close to the truth. While it can work for some writers, there are two problems with this strategy:
Most writers who try to make a drastic pricing change will fail. This is because they’ve invested huge amounts of time targeting a certain market, and they can’t handle the transition (which amounts to completely starting over in many cases). Pricing too low early on puts the writer’s freelance career in jeopardy, and unnecessarily so.
Pricing low with the expectation of increasing rates later will never, I repeat never, provide the best return on investment (ROI) for the time invested. You need to have basic business smarts to run as successful a freelance career as possible, and underpricing services (as opposed to products, which can be mass-produced) is never smart business. Never market a service-oriented business solely, or primarily, on price.
3 Things to Consider When Setting Freelance Writing Rates
Now that you know you should never randomly choose a low rate to begin with, how do you go about determining your minimum freelance writing fees? It’s easy – figure out the minimum hourly rate you need to bill clients in order to get by (or reach your goals), and base other rates (per project, per word, per page, etc.) on the average amount of time certain types of projects take you to complete. Use the following formula:
Hourly Rate = Yearly Salary Goal / Weeks Worked / Hours Worked Per Week
The trick is determining the right values to plug into your formula. Be sure to take these things into consideration:
Your yearly salary as a freelancer is not equivalent to the same yearly salary as a full-time employee for someone else! This is because you have a much higher cost to an employer than just your end salary, and as a freelancer, you have to cover all of those costs independently (basic work expenses, the employer’s portion of certain taxes, the employer’s retirement contribution or health insurance contribution, etc.). So, for example, if you earn $50,000 for an employer, your cost to them (and therefore what you need to earn freelancing to be in an equivalent situation) might be closer to $70,000 per year. Consider all personal and business expenses, plus any savings or “extras” you want available, when setting a realistic income goal – this is a common mistake made (writers set their goals too low, only to learn the hard way that they’re not earning enough for a similar lifestyle). All personal and business expenses have to be accounted for.
You will not be able to base rates on working 52 weeks per year, 40 hours per week! No one is likely to work every week without a break (and even if you think you can, you should never set yourself up for burnout early on). Factor in time for vacations, holidays, potential sick time or personal days. When I set my rates, I like to base it on 45 working weeks. Adjust it to your own needs. As for 40 hours per week, you have to understand that working hours are not the same as billable hours. In the beginning, if you’re properly handling marketing and administrative tasks, it’s not uncommon to have only around half of your working hours as billable hours – meaning you would use 20 hours per week in your formula rather than 40.
You need to account for slow times. In freelancing, you’ll have ups and downs – busy times and slow times. That means it’s very likely you’ll have times during the year where you can’t fill every billable hour at your necessary freelance writing rates. To account for this, I suggest adding at least 10% to either your income goal or minimum hourly rate calculated.
Once you know the minimum hourly rate you need to charge as a freelance writer, you can use that to determine other rate structures, or you can decide to set a goal even higher than that minimum – the idea is to charge at a level your credentials, skills, and experience support, while never dipping below the minimum you need to earn to make a successful go of freelancing.
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