The toughest question any freelancer faces is when a client asks, “what’s your rate?”
Money is a tricky subject because people perceive the value of certain products and services differently. The key as a freelancer is to develop a portfolio strong enough to convince people that you’re worth your rate.
Freelancers all know how valuable their time is, but prospective clients have difficulty doing the same. That’s why we often find ourselves in stand-offs and back-and-forth negotiations.
This begs the question that all freelancers would like to know the answer to – how do you price yourself?
The short answer is that you really can’t.
It depends on a lot of factors and each job has different tasks/outcomes. You really need to tailor it to a specific set of responsibilities.
However, I won’t leave you hanging. If you prefer to find your general hourly rate, then I’ve got a great beginner’s formula for you. Keep in mind that this is a super rough estimate, and you should expect to see work with both lower and higher pay grades.
First things first – what do you want to make in a year? Once you’ve decided on your ideal annual salary (tax included), it’s time to break it down into an hourly rate.
Start With Your Yearly Salary Ambitions
First, you will take that number and divide it by 220. 220 represents the average number of working days in a year (we’re removing weekends and holidays). Once you’ve done that math, you now have your expected day’s salary.
You can then take that daily salary number and divide it by the number of expected hours you plan on working each day. This will give you an idea of the hourly rate you should charge.
I’ve read that freelancers and contractors can reasonably charge up to 15-20% more per hour than their estimated hourly rates. They, unlike traditional employees, do not require any overhead costs from the hirer.
Regardless of which strategy you choose, the most important thing is that you shoot your shot.
By engaging in conversations with potential clients and pitching yourself/proposing your rates, you will discover your own value. You will find out what you’re currently worth, and that will help you come up with your own individualized answer to this article’s question.
It’s funny to think about, but you’ve come full circle in reading this article. At first, you thought there was no specific method to finding your worth as a freelancer. But then you discovered that there is one initial way to attempt to find that worth… only to realize that in trying and putting yourself out there, the answer will lie right in front of you.
And who knows, maybe once you figure that rate out, you’ll be writing an article just like this, telling your viewers that the only way to know is to try.