On 1st of February I talked about The Right Rate To Charge. Today, I would like to introduce a tool to help you calculate the rate for your work.
It is the FreelanceSwitch Hourly Rate Calculator —> broken link
I believe that if you are new in the freelance writing industry, you are puzzled on how to charge your customers. Usually we will charge according to the numbers of articles but you can try hourly rate as well for a change.
Why you need to use this?
- This calculator will help you calculate a suitable rate as a guide for your own rate.
- It is 99% reliable because it takes in consideration from all sections – business expenses, personal expenses, your available hours for work and the profits you want to gain.
You don’t have to strictly follow the rate you get from the calculator. This is as a guide to help you set a proper rate for your service.
Remember, there is always room for discussion when it comes to getting the right rate for you and client. If a client is asking you to lower the rate to an insulting rate, you can always reject the offer and walk away. Find another client who is willing to pay a decent rate, maybe slightly lower than your expectation but never too low it is insulting to work for such a client.
Learn how to determine your cost in more details with FreelanceSwitch.
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I’ve been advocating a very similar formula for freelance writers for a few years now, and while this is reasonably comprehensive, it’s missing one thing I’d consider vital and certainly worthy of its own line item (as it’s often forgotten):
Taxes
Writers (in the US specifically) often don’t realize that they are suddenly serving the role of both employee and employer. While they have to pay the same employee taxes, they also have the pay the employer’s portion–combined through the self-employment tax. That’s a pretty big oversight in my book, as it amounts to 15+% of your gross income for most freelancers (a rather significant expense).
The real key is in understanding that freelance rates and employee salaries are far from directly comparable–freelancers would fare much better if they’d take time to understand that the rates they charge freelancing must equate to their respective cost to an employer (factoring in employer’s contributions to taxes, sick and vacation pay, bonuses, regular expenses for the job, health and retirement benefits, etc.). That alone won’t give you a specific rate to charge, but it will help people look at freelance rates more realistically before deciding on anything concrete.
Twitter: writingc
February 17, 2009 at 12:49 pm | Permalink |
Yes, US writers face more challenges than non-US writers. At least, I am not obliged to pay tax at the moment since freelance writing is rather new in my country and people are not seeing the potential of earning more through freelancing (regardless of industry).
However, having a calculator to lay out the foundation of rates is better than no help at all. At least I find it rather useful in helping me to set a better rate. Perhaps when I have to pay tax, I will have to work out my own formula in calculating the rates.