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Why Your Hourly Freelance Writing Rate Matters

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Why Your Hourly Freelance Writing Rates Matter - AllFreelanceWriting.com

We've talked about freelance writing fees quite a bit here over the years, but today we're going to focus on something that doesn't always get enough love in the freelance writing community: hourly freelance writing rates.

Don't get me wrong. Hourly rates aren't an ideal billing strategy, and we'll talk about why. I can't think of a single case where I'd recommend them for a writing gig.

That said, hourly freelance writing rates are important when it comes to setting other fee types and growing your freelance writing business.

Freelance Writing Rate Types

Let's start by looking at the various types of freelance writing rates you might come across so you understand the alternatives.

Hourly Rates

This is the rate type we're focused on in this piece. It's simply when you bill clients based on the number of hours spent on their project.

Per-Diem Rates

Per-diem rates are daily rates. They're more commonly associated with other types of freelancers, such as photographers who might spend an entire day photographing an event.

It's unlikely you'll come across a situation where a per-diem rate makes sense, but examples might include a gig that requires you to travel or a short-term temporary contract requiring you to work full days for a single client.

Per-Word Rates

This is when you charge clients based on how many written or published words are included in a piece. It's more common in magazine writing gigs, though you'll also see per-word rates advertised for online writing work as well, often on the lower end of the pay spectrum.

Per-Project Rates

Per-project rates are when you have a set fee covering the entirety of a project. For example, this includes per-article rates.

I would also lump per-page rates in here, such as for freelance copywriting projects. That's because you're generally going to convert your standard per-page rate into a larger project fee once you receive the specs from your client.

Retainer Fees

A retainer fee is an up-front payment covering a set timeframe, guaranteeing you a certain amount of pay and guaranteeing the client a certain commitment from you.

For example, a freelance blogger might charge a flat monthly retainer covering content strategy, a specific number of blog posts, responding to comments, and writing related social media updates over the course of each month.

The Rate Types I Strongly Recommend

I highly recommend freelance writers stick to per-project rates and retainer fees whenever possible.

Why?

Retainers amount to guaranteed income, committed up-front, for a particular time period. And per-project rates allow you to set standards that can be customized as necessary.

Plus, both reward long-term commitment to clients, specialties, and project types by having built-in mechanisms for regular "raises." We'll look more at this shortly.

While I'm not a big fan of the other rate types mentioned, hourly rates are particularly problematic for most freelance writing projects. Let's look at why that is.

Why Hourly Billing is a Bad Idea for Freelance Writers

There are some important perks to being a freelance professional. For example:

  • You get to set your own rates.
  • Only you decide when and where you work.
  • You have the choice to accept or reject individual projects.

In general, freelance writing also means you're paid based on what you deliver, not the amount of time a client thinks their projects should require.

This changes with hourly freelance writing rates.

How Hourly Rates Can Pit You Against Your Clients

When you charge hourly fees, it's in the client's interest to minimize the amount of time you spend on their projects. It can also be in the freelancer's interest to drag things out.

Of course you would never do that.

But other freelancers have. And these tensions do exist.

Have you ever seen an advertised gig where the potential client tells writers how long it should take them to write each article? I see these often when curating leads for this site's freelance writing job board.

Why would a client post something like that?

Perhaps they felt a previous freelancer burned them by taking their sweet time.

Maybe they wrote a few (not exactly professional) articles themselves (intimately knowing their business and market), and they're only willing to pay for that same time commitment without allowing time for necessary knowledge transfer.

Or they might just be cheapskates. Perhaps they hired lowball writers in the past and think that's the actual going rate of professionals.

No matter the reason, their perception should have no bearing on how you do your work, and it certainly shouldn't influence your pay.

Hourly Rates and Raises

Charging clients on an hourly basis can also pit you against each other as you get better at your job and seek pay increases.

You always have the option of telling any client "I've increased my rates, and here's what I charge moving forward." They always have the option to hire someone else.

Sometimes that's best for everyone. You might already be at their maximum available budget. They might not see a high enough ROI to justify paying more. And you might be ready for new challenges and higher pay elsewhere.

But when you focus on per-project rates, for example, raises aren't entirely reliant on you actually charging more.

For example, let's say you handle a company's entire content strategy. You write their blog posts, marketing copy, social media content, email newsletters, and long-form content like white papers.

If you bill hourly for all of this, increasing your hourly rate could be a hard sell.

But when you bill on a per-project or retainer basis, the more you get to know the client and their target market or audience, the faster the work will get. This is natural.

If you're doing a similar amount of work each month, but spending less time on that work as you become more familiar with the client, industry, project types, or style required, you earn more each working hour even when you don't outright charge more.

Know (& Set) Your Hourly Freelance Writing Rate

Even though I advise against charging hourly freelance writing rates, you should still know what yours is, and you should still set your target hourly fees.

Why?

Those hourly rates are how you set per-project, per-word, or retainer fees.

If you're setting rates by pulling numbers out of thin air (or looking at publicly-advertised rates as inspiration when they're notoriously low), you're doing yourself a disservice.

Instead, you want to know how much your current projects pay for the time you're devoting to them. And you want to have a target hourly rate that serves as the minimum any other rate type should cover.

For example, let's say you're a relatively new freelance writer. The minimum I recommend charging is around $50 per hour.

Let's also say you write fairly short web content, and you turn around most articles or blog posts in about three hours (from research to final revisions). You would set a standard per-project / per-article rate of $150.

This would be a base rate you could build upon. For instance, if most of the articles you write don't require interviews or extensive research, you would increase that base rate for any project that does.

Side Note on Freelance Rates:

If $50 per hour sounds high to you for a relatively new freelancer, you might be caught up thinking about hourly rates in employee terms. Freelancing is different.

Your hourly rate is based on billable hours, but it has to cover all working hours (marketing, admin, etc. on top of the time you spend on client work).

Those hourly rates should also cover everything an employer traditionally does (which are often forgotten when talking only about salaries). That includes health insurance, sick time, vacation days, and the employer's side of tax payments which now comes directly from you.

If you haven't accounted for these things, you're probably under-charging.

How to Determine Your Current Hourly Freelance Writing Rate

If you want to know how much you earn per-hour now, it's a simple matter of time tracking.

Spend a few weeks tracking all your working time. Make sure you include both client projects (calls with clients, emails, research, writing, editing, etc.) and other work tasks (your professional blog, marketing activities, billing... everything).

This will help you figure out how much you're earning for each billable hour for each client you have. It won't always be the same.

You'll also see your average hourly rate per billable hour, and you can figure out how much you make for each working hour, client projects or not.

If you're happy with what you find, great. Use that average billable hourly rate to set your standard article or project rates.

If not, it's time for a change. And that means setting a new target hourly rate.

How to Set Your Target Hourly Freelance Writing Rate

If you want to know what you really need to charge to reach your goals, try my freelance writing rate calculator.

The simple mode lets you base calculations on your target yearly income.

My past research showed you need to charge at least 30-40% more as a freelancer to earn the equivalent of an employee in a similar position.

So, for example, if you left a $50k per year job to freelance and you want to earn the same amount, you would set a freelance target closer to $70k.

And if you're a specialist, you should be earning a premium on top of that. So increase your yearly target from there. Run it through the calculator to see what that comes to as an hourly client rate. It might be higher than you expect.

The advanced mode goes beyond this. People often underestimate what they need to earn when they aren't used to the differences between freelance pay and employee pay.

The advanced calculator gets into the nitty gritty, letting you account for specific expenses and savings goals to find out what you need to earn to reach your overall financial targets.

Once you know that, you can translate that into your billable hourly target and set project rates accordingly.

Ways to Increase Your Hourly Freelance Writing Rate

You might not be charging clients an hourly fee, but tracking your hourly rates can make it easier to increase what you make. And you have several options to increase your hourly earnings. For example:

  • Increase the rates you charge directly. If you're worried about losing clients, raise them on new clients only at first, then raise it on older clients when you've shown there's enough demand at your new rates (or replace them). Don't forget to do this if anything changes about your value proposition (a new degree or certification for example).
  • Work at optimizing your process on your most common types of jobs to decrease the amount of time each requires.
  • Focus on digging into your long-term clients' businesses to also cut down on the time each gig requires (know who they're writing for, become more knowledgeable about their niche or industry, etc.).
  • Along those lines, make an effort to build more long-term client relationships so you aren't starting from scratch with most new gigs.
  • Group related services together into retainer packages (this can be as simple as X articles per month or a full content strategy / creation / management contract). When you batch tasks like this, it can be easier to optimize your work. Batch outlines and research for all a client's posts for example.

When you know your real hourly income and you find ways to get more done in less time ("work smarter, not harder"), you develop a system that provides built-in raises between your actual price increases.

While hourly freelance writing rates might not be the best rate structure for most writers, it pays to understand what your hourly rate is. Using an hourly rate target to set project-based and other fees will help you stay on a the right path to reaching your professional goals.

Jenn Mattern is a professional blogger, freelance business writer, consultant, and indie author. She runs numerous websites & blogs including All Freelance Writing, Freelance Writing Pros, NakedPR, and Kiss My Biz.

Jenn has over 20 years' experience as a professional writer and editor and 20 years' experience in marketing and PR (working heavily in digital PR, online marketing, social media, SEO, new media, and thought leadership publication). She also has 18 years' professional blogging and web publishing experience (including web development) and around 16 years of experience as an indie author / publisher.

Jenn also writes fiction under multiple pen names and is an Active member of the Horror Writers Association.

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