Rates are one of the most important parts of making a living, let’s say a financially viable living, from freelancing. Whether you’re a writer, designer, illustrator, video maker, animator, editor, content producer or any other type of creative in the media industry, it all comes down to your rates when you work for yourself.
Yet a surprising number of freelancers struggle with rates. There are regularly the same questions in freelance groups about how to charge for different types of jobs and what to charge for creative work.
So I’ve read a lot of questions and loads of answers over the years on the topic of rates and now that I’ve joined the ranks of full-time freelancers, I’m confronting this question of rates pretty often too.
I thought it would make a useful blog post on the topic to examine how to work what rate to charge, how to charge and then link to some online resources for more help on the question of rates.
How should you charge?
The first part of figuring out your rate as a freelancer is working out how you charge. Except that I have to clarify up-front that this will depend on who you’re working for as your client. If you’re writing in editorial for magazines and websites, the rate is usually set in-house and there’s little or no scope for negotiation.
In the interests of a reality check at this point, I need to take a slight departure into the topic of word rates. Basically word rates have been stagnant, or worse falling, in recent years in the media. How you gonna blame? There are numerous reasons for the media ‘disruption’ from new tech. Here goes a few… Blame the tech giants that dominate the web in terms of eyeballs and their associated advertising, blame the content mills that encourage low rates and global competition, blame the readers who have come to expect free access to news and blame the plethora of sites now accessible from almost anywhere in the work and the rise of independents like influencers and bloggers who offer content for free. It’s the sad fact of the state of the media in 2019 that cut backs are still happening, people are losing their jobs, word rates aren’t improving and outlets are closing or being amalgamated or bought up and rationalised.
Now back to the question of the way to charge. Basically there are a few different ways to charge.
By the word
When you’re paid by the word, as you can probably guess, you’re paid a certain amount for each word. Right now I’d say that word rates vary, a lot. I’ve been working for UK magazines and their words rates that I’ve been quoted a considerably lower than Australian word rates, even factoring in the currency differences. Generally it’s in the range of 10p to AU 80 cents per word. It’s pretty clear what you’ll get paid, although the sticking point can be whether you’re paid for words submitted or words printed, after editing which usually involved cutting. If you’re briefed to write an article to a certain word count, then you should be guaranteed that amount of words will be paid. I typically give 5% over the word rate for editing, unless I know the editor wants me to write to the exact word count because I have a detailed brief and there’s very little scope for variation and need for editing.
It looks something like this:
500 words @ .75 c per word = $375
Sometimes I am paid per 1000 words so it might be £300 per 1000 words and so for a 2000-word story that works out at £600. Again it’s pretty straightforward. Depending on what I’m writing, I might be requested to supply more images or screenshots with slightly less copy for the fixed amount of £600 by agreement with the editor.
By the hour
You bill the client for each hour worked and that usually includes interviews, research, writing and editing. You may also need to build in a few hours for all the back and forth of correspondence in your incomes mix if you’re charging by the hour.
By the day
A day is more typical when working in-house with agencies or clients that want to book you for one, several days or a block of days. Day rates vary depending on the business and the client with high-end advertising tending to pay the highest and government and business in the middle with smaller agencies, NGOs and other businesses tending to pay less than this.
By the content
In this case you might be paid a fixed fee for a piece of content such as an article, blog or press release. If you’re being paid per content piece, it’s important to be clear about the scope of the content. This means agreeing up-front on the amount of editing, length of piece, number of interviews and so on. The rule of thumb is that if it’s a fixed fee, you need a pretty firm idea of the scope of work expected. Adding in rounds of edits, lots of correspondence for changes and additions via email, requesting extra interviews and so on all adds time to the project that needs to be budgeted for in the fee from the outset.
By the project
If you’re working on a project basis, then you’ll be paid for a particular job that may involve several articles, an editing project, a batch of interviews and so on. Many of the same rules apply for a project as setting your rate for a piece of content, although it’s bigger and it’s even more important to nail down the scope of the project because there’s more room for it to grow and to negatively impact on your fee.
How to set your rates
There are various ways you can set your rates and if you ask a group of freelancers, it’s likely you’ll get as many different answers as there are freelancers. The simplest formula is one I found from another freelancer some years ago and I have developed my rates using it. It is calculated a lot like having a salary in a job and goes something like this:
Annual salary that you need or want to live on in $ terms.
This is a product of expenses like rent/mortgage and living costs and extras such as trips, savings etc.
Sick leave, holiday leave and superannuation and any other extras
Factor in losing a percentage for tax.
Add up all of the costs etc needed to have a proper annual salary and then figure out the next part.
Number of hours you need or want to work.
This needs to take account of time off for all the life stuff you have to do. As a freelancer, time is money so anytime you’re not actually producing something, you’re not really earning so you need to budget for this time so you make enough to cover your real life.
If you divide the salary figure by your hours of work, you’ll arrive at a rough hourly rate. Now you can look at your hourly rate as a starting point. You don’t have to stick to it and you might not for lots of reasons. There are some things to consider such as your clients and the type of work you do.
There are a few considerations such as:
Is it a viable fee that you want to charge clients?
Can you increase and decrease the fee depending on the job and the client?
Can you increase the fee marginally each year to take account of cost of living increases?
Do you get paid regularly and have money to cover when you’ll be paid?
How to get your preferred rate?
So you’ve set your rates, now how do you get that rates? If only there was a magic spell that would give you the rates you need, there’s be a lot less angst and uncertainty around freelancing. It’s why building up regular clients in content marketing or working with the same editors is helpful because you know the rates and usually the amount of work needed to produce an excellent article or piece of marketing writing.
If I’m working with a client on content marketing writing then there’s scope for negotiation. I have a schedule of fees that I can send if they’re interested in me writing content for them and we can take it from there.
I’ve worked out my base level hourly rates to make a profitable living and have worked up a schedule of rates for different types of content. I’m fortunate that I don’t need to take any rate that is offered and having 20+ years in the media working across almost all types of organisations and content and a couple of degrees, I shouldn’t have to accept the lowest rate going.
I have on several occasions written polite but firm emails to clients and the occasional editor declining work at a stupidly low rate. I ‘m pretty sure they wouldn’t work for a salary that didn’t enable them to survive yet budgets and the idea of finding low-paying freelancers anywhere in the world, gives them the notion that freelancers will accept ridiculously low rates. And there are a lot of freelancers who will take almost any rates like the ones starting out or the ‘digital nomad’ tribe that are usually young and living in a cheap country to help keep their rates low.
My email goes something along the lines of “It’s not financially viable for me to work for such low rates.” Not surprisingly I often don’t hear anything that from those emails.
As I mentioned above, there’s not a lot of scope to negotiate around editor rates. I’ve tried once or twice but there’s not a lot of movement to be had. If you want the story or the gig, you’ve got to take the rate. I don’t think that every job needs to be at top dollar. It’s not the 90s or early Noughties and most of us aren’t Carrie in Sex and the City going to write for Vogue. In the episode she tells her gal pals that she’s been offered $4 a word and then negotiates a rise to $4.50! “Most people get $2,” she says. If only, is my response to this. Not in my world of freelancing.
Help setting your rates
Here are some resources that can help if you’re trying to set your rates or you just want to review your current rates.
MediaBistro has advice on setting rates.
The Australian Society of Authors has a guide to various freelance rates.
The Australian freelancers site Rachel’s List has a useful blog of working out what to charge.
Journo Resources has rates and a list of what various UK outlets pay.
The Guardian has an article in its small business section on what to charge as a freelancer.