How Should I Charge?: Setting Your Rates as a Freelancer

rates

I want to get down in the nitty-gritty details today and provide you with an answer to a question I asked myself a million times: how should I charge? Notice this is not “How much should I charge?” The answer to that question depends on a huge array of factors (your niche, your experience level, etc.). The guide I adore to answer that question is Writer’s Digest’s How Much Should I Charge PDF, which I’ve linked on this blog many times. What I’m talking about in this post are the different methods freelance writers and editors can use to set up their rates. Different methods work for different kinds of projects, so I want to put them all here in one place for you.

1. Hourly

This method is the iffiest. No one seems able to agree on whether it works in your favor or against it as a writer or editor, especially as a beginner. An argument can be made that this is the best method for beginners because when you are first starting out, you may not realize how long a certain task is going to take. If you’re charging by the hour, you’re adequately compensated for the time spent (so long as the rate you’ve set is good), even if you misjudged the length of the project.

The book I read for my editor certification course suggested starting out with an hourly rate because it may make your client more comfortable than forking over a large lump sum of cash for a downpayment to someone with fewer years experience. This is because the client can potentially ask you to do X amount of hours and then ask to review that work. If they like what you do, they can commission more hours.

However, in my experience as a freelancer, hourly rates make some clients very nervous. This is often the case with clients who have never hired an editor or ghostwriter before, and they have no concept of how long these projects take. They look at an hourly rate and have awful visions of how quickly that can add up. An hourly rate often equals a large, unknown amount for an inexperienced client. If you prefer an hourly rate method, you can assuage such fears by giving your client an estimate of how long it takes you to do that specific type of project so that the client has a more finite amount in his or her head. However, you can’t really give that sort of estimate if you’re just starting out because you don’t know yourself. So, it becomes a vicious cycle.

Personally, I’ve decided to stay away from hourly rates when it comes to editing and ghostwriting. This is because I work mostly with individuals, and I feel hourly rates are more suited for freelancers sending bills to corporations with a nice budget allotment. However, there are plenty of freelancers out there who swear by them. Just weigh the pros and cons and decide if it might work for you. The main pro is that you are always fully compensated for the effort put in, no matter what ends up happening with the project. The main cons are that you can easily anger a client if the project runs long, and many new clients are wary of hourly rates.

You can also do what I did when I first started and offer clients the option for an hourly rate or a fixed rate. I would tell clients that if their manuscript was in the final stages of editing and was already pretty clean, they might benefit from choosing the hourly rate because I could get through the manuscript faster. I only ever had one client choose that method, but it worked out fine.

2. Per Word

This is my bread and butter. I personally prefer this method because the client doesn’t have to worry about how fast or slow you work, but you still get compensated for every bit of the final product.

In editing, the per word rate is somewhere between one and five cents per word depending on what sort of editing you’re doing (read about the different types here) and your experience level. However, most editors don’t list their per word rate on their sites or in their proposals; they list a per page rate. A per page rate is just a little easier on a client’s eyes. The idea of charging per word can make a client go, “Good grief, just how many words do I have?” and then they check their document and see something in the hundreds of thousands and freak out a little. If, however, they check their page count and see something in the hundreds, there’s far less chance of unnecessary panic. A standard manuscript page (in official manuscript format) is between 250 and 300 words. If you want to make yourself a little more attractive when you’re starting out, you can count a page as 300 words. Now that I have a nice chunk of projects in my portfolio, I’m thinking it’s time to switch mine to 250.

In ghostwriting, the per word rate is typically anywhere between ten cents (very low) and three dollars. This serious rise from editing makes sense. In editing, someone else wrote the words, you’re just making sure they are all correct. In ghostwriting, you’re not only creating the words, but you’re also not getting any credit for them. Ghostwriting rates are typically higher than standard freelance writing rates (say, writing articles for magazines) because of the lack of credit. The per word rate will also go up based on what it is you’re writing. If you’re writing a short blog post on a subject you’re already knowledgeable in, you’re going to charge lower than for writing a book from scratch.

Now, the per word rate only covers the actual writing. If you have a nonfiction ghostwriting project that requires you to gather sources, read books on a subject, and compile all of the arguments yourself, that’s not covered in the per word rate, at least not if you’re charging on the mid to low range of the spectrum. Now maybe if you’re charging a whopping two or three dollars a word, you’re already adequately compensated for time spent researching, but if you’re starting out, you better be charging extra for research, or you’re going to be giving out a lot of free labor. I charge hourly for research because I feel that’s the best way to make sure I’m compensated for the effort put in.

3. Per Project

This is usually an experts only option in the writing and editing world (though it’s a little more standard for something like freelance design). Trying this method as a beginner is a bad idea because in order to accurately set a fair price (both for you and the client), you have to know exactly how much time is needed to complete the project and exactly how much work will be required. It’s very hard to do so unless you’ve done numerous projects of the same sort.

Even experts don’t usually use this method on a regular basis. It’s most often used either to provide a slight discount for a regular client or to tack on some extra money for a rushed project. This is because it’s like a package deal. It’s attractive to clients because they know up front exactly how much the whole project will cost, and they are less likely to get nitpicky about the price because they don’t have to worry about the possibility of an hourly rate getting out of hand.

You use your desired hourly rate to calculate the fixed fee. Some people give a price range instead of an exact price, so like $500-$600 depending on x, y, and z. It’s also a good idea to outline exactly what services are encompassed in the project, that way the client can’t tack on an extra service after the contract is signed and expect the price to remain the same.

The problem with this sort of fee is that if you miscalculated and you end up spending far more hours on the project than expected, you’ve just got to suck it up and take the loss. You promised a flat rate, and you can’t go back on that.

The most common services writers and editors use a flat rate for are book proposals and book evaluations/critiques.

4. Daily Rates

If you are working regularly for the same client, you can charge by the day. All you do is take your hourly rate and multiply by how many hours you want to work a day. However, usually, when freelancers use a daily rate, they make it more attractive by advertising it as a slight discount from the hourly rate. So, if your regular hourly rate is $30 an hour, you might calculate your daily rate using $25 an hour as the base amount. This is good for encouraging loyalty in steady recurring clients. It works best if you do writing or editing projects for a company that needs a weekly quota of work.

5. Rush Rate

What people hiring freelancers need to understand is that they can only choose two of the following: fast, cheap, and high quality. If a client wants high-quality work delivered super fast, they need to understand that they must pay extra for that. Your time is valuable, and if you have to rush one project, it means you’re either going to have to postpone or pass up another project, or cram a ton of work hours into one day to complete everything. You should be compensated accordingly. If your client doesn’t seem to understand this, respectfully explain it to them. Add a few bucks to your hourly rate or a few cents to your per word rate for projects with super fast turnarounds. And don’t feel guilty about it either.

Final Thoughts

I hope that this list combined with that Writer’s Digest chart helps you set your starting rates or boost your existing rates after you’ve buffed up your portfolio. It’s really not too difficult; it’s just a matter of having all the options in one place for comparison. It comes down to what sort of writing or editing work you’re doing and your working methods. You may have to try out a few different tactics to find the right fit, but you’ll be getting paid along the way.

Don’t sell yourself short, don’t forget that you’re the client’s business partner, not their employee, and have fun doing what you do best. Happy freelancing!

 

 

 

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