Are you wondering how to set your freelance rates? Struggling to navigate the world of hourly rates, day rates, retainer packages and the rest? I hear ya. Figuring out how much to charge for your services is a complicated topic and everyone has an opinion.
When I first started charging an hourly rate, I didn’t think very much of myself. I’d been making sandwiches for a living for a few years and scraping by on £7 per hour and free food and coffees to make the day feel a little less dreary. So when I had to come up with a figure to charge for my services, I didn’t feel worthy of asking for very much at all. I charged £10 per hour.
Several years later I upped that to £20 per hour, and I’ve increased it yet again since then. I did some research into what other people were charging and also thought about how much I would realistically like to earn every month.
Watch this Instagram video to learn more tips on how to set your freelance rates.
Say for example you want to earn £3,000 per month. Great, now how many hours would you like to work in that month? If the answer is 120 hours (thirty hours per week), then you would need to charge £25 per hour. (Bear in mind that this is all before tax, so you would lose a certain percentage of this to the government.)
Consider your capacity
Instead of working backward thinking about hours worked, maybe consider how many days you would like to work, or how many clients you can comfortably work with, or how many products you would need to sell to make up that income.
Remember that just because the typical working week consists of five days this doesn’t necessarily mean you can dedicate five days to doing paid work. You’ll need time to do the work that doesn’t pay (in a direct sense anyway) such as sending invoices, implementing marketing campaigns, meeting with potential clients, etc.
As a rule of thumb, I would assume that at least one day a week will be required for various freelancer-related tasks and then take it from there.
Do your research
TIP: Talk to other freelancers and ask if they would give you a ballpark figure about what they charge. Do this with lots of people, not just one or two, because the chances are that they could be under or over-charging for their services! When I increased my rates recently, I asked for input in a freelancer Facebook group and people were more than happy to tell me their hourly rate.
Learn more from my book Out of Office: Ditch the 9-5 and Be Your Own Boss.