Setting Freelance Rates

What are your rates?

How much do you charge for a blog post? $15 per page? $50? $125?

Do you charge by the hour or by the word?

Do questions like these make you nervous? If they do, you are not alone. Many freelance writers have trouble deciding how much to charge for their work. Setting prices can be one of the most nerve-wracking and frustrating parts of freelance writing. While no one can tell you exactly how much you should charge a prospective client for a particular project, determining your rates ahead of time will help you when it is time to quote a price for your next freelance writing job.

Hourly, Per Word or Per Project?

When you charge hourly, you set up a specific hourly rate for your time. Whether you charge $10 per hour or $100, you will bill you clients based on how much time you spend working on their project. Charging by the hour can prevent you from undercharging, because you’ll be paid for the actual time you’ve worked. While stating an hourly wage works well for many writers, you need to be wary of a few potential pitfalls:

• Record keeping: You need to keep excellent records if you charge by the hour. If you are a freelancer who likes to flit from one job or topic to the other each day, then you’ll need to track each of those projects separately so you can bill your clients accurately.
• Interruptions: Hourly work may not be best if you have a lot of interruptions each day. Have preschoolers running about? Can’t resist a ringing phone or pinging email inbox? Each of these interruptions will cost you time and mess with your time tracking schedule.
• Client resistance: Some clients will prefer to hire a writer for a flat, per project fee to avoid surprises when the invoice shows up.

Charging by the project or by the word simplifies record keeping, since you do not have to keep such a close eye on your time. While this is a benefit to the organizationally challenged, charging by the project or word can hurt you if you don’t charge enough for your time. Set too low of a “by-the-word” rate and you may end up doing a lot of work but only earning a small amount of money.

No matter how you decide to set your prices, you should know about how much you need to make per hour, even if you choose not to disclose this to your clients. If you know you need to make $35 an hour to make writing worthwhile, and that a 500-word article will take you about two hours to complete, then you can quote $70 for the piece, without going into hourly rates at all.

Setting Hourly Rates

When you think about what you need to charge for each hour of writing, don’t overlook what it costs you to work. The amount you need to charge may be higher than you think. If $20 an hour sounds great to you at first, you’ll find you like this rate a lot less if you are parting with $12 an hour for a nanny or babysitter. At that point, your net is just $8 per hour, only slightly over minimum wage in most locations – and that figure is before the hefty self-employment taxes you’ll pay if you are in the United States.

Pick your hourly figure by deciding the amount of true net income you need to come into your house. Net income is what you are left with after you pay your taxes and after you pay any costs you incur to work, including childcare and office expenses. How much do you want to bring in each week with your writing?

In general, the less you charge per hour, the more hours you’ll need to work to earn an income writing. Do you prefer to write a lot of pieces and earn a small amount for each piece or would you rather write fewer pieces, but charge more for each one? Would you rather write five $15 blog posts or charge $60 (or more) for a single post? Both rate models have fierce advocates, but only you can determine which works best for you – and the time to decide is before you need to state a rate to a client.

Once you know how much you need to make, you can calculate the amount you need to charge per hour. Take the net amount you have decided on, then add in extra money for taxes, childcare and the rest of your expenses. The resulting amount is the true hourly rate you need to charge. Once you know this, you can use it to charge your hourly clients or to get a good idea of how much to charge for set rate or by-the-word work.