How to set your rates as a freelancer

When freelancing, it can be tricky to know what you should be charging. If you’re new to the industry here are a few tips to help you get started.

Firstly, ask around

If you’re on friendly terms with other more senior freelancers, they should be able to give you a ballpark guide as to what you should be charging, based on your experience. Otherwise, whatever industry you’re in, your trade union should have a freelance division who can also advise you. It can be tempting to take whatever rate you’re offered at first, but it pays to know your worth!

Try not to take poorly paid gigs out of desperation

When I first started freelancing many years ago, I wrote hotel descriptions for a travel company (around 500 words) for the princely sum of ￡11 each. Which was stupid. It took time out of my day, when I could be pitching for better paid work, or doing office temp work that at least paid slightly better. Most content agencies are brilliant and pay freelancers fairly, while others will try and get away with paying a pittance pretending it’s ‘normal’. Don’t fall for the excuses that ‘they’re a very small company’ or ‘that’s all they have in their budget’. You’re not a charity – your landlord wouldn’t accept those excuses and neither should you. And remember, if you keep accepting these poor rates, nothing will change.

None of us like turning down work. If the client says that they only have a limited budget - instead of refusing the gig altogether, tell them what you can offer for that budget. Sometimes you can come to a compromise, but if you suddenly slash your initial rate in half for the same work, the client won't have much respect for you.

But don’t set your rate in stone

Your rate should be fluid. It’s all very well saying, “Well I’m charging ￡X amount a day and won’t go beneath it.” Fair enough if you’re in demand – and obviously if a client’s rates are appallingly low, you should try to negotiate or go elsewhere. But sometimes (especially if you’re fairly new to freelancing) you should set your prices like a hotel, charging slightly less when it’s ‘off-season’. After all, you would rather have some work than none at all. Also, not all jobs are the same. For example, creative businesses or magazines will have less budget than a big corporation or agency, so you should expect to alter your rates accordingly. The ‘editorial’ stuff (magazines, small companies etc.) can be a lot more fun and interesting work, plus it can lead to great exposure and perks. But try to limit the amount of time you spend on this if it's not making you much money and always prioritise commercial work. Also don’t let people use the old ‘exposure and perks’ excuse as a way of paying you next to nothing. Doing a job you love doesn’t mean getting taken for a ride. We all need to eat!

Try not to charge by time but per project

It's taken me a long time to realise this, but charging hourly or day rates puts a huge limit on your earning potential. Unless you’re a top shot lawyer and can charge the big bucks, there are so many hours in a day, or days in a year you can work after all. It also skews the value of what the client is paying for and gives them leeway to pay you less, with the argument “oh, but this should only take you an hour or so, etc.” regardless of how stressful or tricky the particular task is. Charging per project, or for a 'package' of services is a better reflection on your skills and expertise.

For example, it could take you an hour to come up with an award-winning tagline for a campaign. You might charge ￡200 for it. The client might think – “￡200 for an hour? That’s crazy!” But if you charge for the work itself, then they might be like “Ok, that’s fair.” You’re charging for the quality of the work itself and the innovation of your ideas, not the time it takes you to come up with them.

[Obviously unless you’re exceptionally talented, you should put in adequate time and effort to produce work that’s up to scratch. I’m not saying produce work that’s sloppy and rushed (unless you want to lose the client). But the point I’m making is that as you become more experienced, you can work more quickly to the same standard. Hence why charging by time doesn’t always reflect your output.]

Don’t give out ‘freebies’

A lot of my clients are like friends and I'm happy to chat with them if they're stuck in a tight spot or offer the odd bit of advice, trusting they won't take advantage of my time. But sometimes it's good to set boundaries, especially if it's someone you haven't worked with before. Before you take on a project, make sure you're clear on the amount of revisions you're prepared to do if the client isn't totally on board with what you've produced. Obviously you need to produce something the client is happy with (they're paying you after all!). But if you've followed the brief and they decide they want something completely different to what they originally asked you for, then it's only fair to charge extra.

Plus it’s not unusual to get an email, “can you just come up with a tag line for this, or some quick ideas for that, or what do you think about this idea? Etc.” and it ends up being a long consultation with them basically picking your brain for free. Be strict on the amount of time you spend speaking to a client and answering their emails - you're not their full-time employee after all. Responding to the odd query or having a quick 5-minute catch up might not seem like a lot, but it can soon add up - and if you’re not firm with people, suddenly you’re doing twice the amount of work for the same rate.

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