The MONSTER question that every new freelancer asks…
Hold on tight!
“How much money I should charge and how to decide my freelancing rates?”
The most confusing question, right?
Before you start reading the article, it’s IMPORTANT that you understand that there’s no perfect formula or any rules to pricing.
No false promises, baby!
Let’s get back to the article…
In my early days, when I get a project, two voices hit my mind. One says, if I ask too much for this project, I’ll lose the client. Other says, if I charge too little, I’m undervaluing myself. But it’s good to keep the clients instead of losing them.
I learned one thing in my journey: When you’re a beginner, any client is a good client for you! Don’t be picky.
Don’t chase clients who can pay you a ton of money… For you, they don’t exist yet!
If you get paid a little amount for a project – It’s perfectly fine!
Build your network, expand your market, work with a couple of clients, make some mistakes, earn some experience under the belt, define your niche and ideal clients.
Now it’s’ time to ask this BEAST question:
“How Much Money Should I Charge?”
There are two pricing models I tried in my Freelancing career. And in this article, you’ll find these methods. Check and decide which one is good for you.
Model #1: Hourly Rate
This is the most popular choice among new freelancers. In this model, freelancers charge an hourly rate for their services.
This model gives you a lot of freedom and flexibility, In my early days, when a client came to me and I estimated the number of hours that project would take. I used to charge $10 per hour for my writing and editing services.
The best thing?
You get paid for each hour you work. And there’s a chance to make some extra bucks if client comes up with an additional request.
How can you set up your hourly rate?
There are a few factors to keep in mind before setting your hourly rate:
- Your experience
- Your location
- Your expenses
- Desired lifestyle
Ask yourself this question: How much money do I WANT to make in a year?
Have a salary goal, first!
Let’s say, you’d like to earn at least $12, 000 per year. Remove the three zeros from your salary goal: $12 per hour (In India for a beginner)
Let’s break it down.
If you work 6 hours a day (20 days in a month).
Total days in a year: 240 days.
Total hours: 240*6 = 1440 hours.
Total amount: 1440*12 = $17280
In your first two months, you’re probably not going to get enough work, but still, you can achieve that milestone.
And once you have some experience and a couple of clients, you can raise your hourly rate.
There’s something more…
Why did I stop charging hourly?
A client came to me through LinkedIn and asked me to write the content for his website. He gave me detailed about his project. And I started working.
I finished the content in 5 hours.
The client was happy with the content and found it interesting. But I had only been paid $75 for it!
I knew in my mind that the content was worth far more money. I was making less money than I worth. And that day, I decided to change my pricing model.
Model #2: Project-Based Fixed Rate
This is the model which I follow, it allows me to complete work quickly and maximize my earnings. In this pricing model, you ask for a single flat fee for a project.
Let’s say, you charge a fixed rate of $300 for a project and complete it in 6 hours. You just earned $50 for an hour. And you delivered the project in a day or two days. Client is happy!
If you charge hourly for the same project and ask to pay $50/hour. Client wouldn’t hire you!
The best thing about this pricing model?
You know exactly how much you’re earning and client knows how much they’re paying to you.
Let’s talk about the other side of this model.
Sometimes, client comes up with some extra requests that take extra time. And sometimes, I underestimate the time it will take to complete the project, and can’t ask a client for more money for this. 🙁
How can you minimize the cons of this model?
Spend some time to understand the project and client’s need. And notify the client if they need something extra (out of the contract), they have to pay for those requests.
In this model, you have to make up your pricing for every client. No formula.
Factors That Help You to Determine Your Freelancing Rates
As I mentioned above, there’s no rules and formulas to determine your pricing. But you can consider some factors before determining your pricing.
- Do I like the client (Type of client)
- How interesting the project is
- How much time it will take to complete the project
- Does the client have enough budget?
- Find out what other freelancers are charging for similar projects (Freelancer platforms)
- Can’t figure out yet? Ask from a pro
Still Stuck? Try These Freelance Rates
Still stuck? It’s totally fine. Here are some numbers for you (approx)
Content Writer (India)
Entry Level: INR 0.7 – 0.9 per word (In INR) OR INR 400/Hour (for 500 words)
Intermediate: INR 1 – 1.5 Per Word (In INR) OR INR 700/Hour (for 500 words)
Experienced: INR 1.6-2.4 Per Word (In INR) OR INR 1000/Hour (for 500 words)
Expert In Demand: INR 2.5-3.2 Per Word (In INR) OR INR 1300/Hour (for 500 words)
Website/Graphic Designer (India)
Entry Level: INR 600/Hour OR INR 4500/Day
Intermediate: INR 1000/Hour OR INR 7000/Day
Experienced: INR 1500/Hour OR INR 11000/Day
Expert In Demand: 2000/Hour OR INR 15000/Day
Entry Level: INR 800/Hour OR INR 6000/Day
Intermediate: INR 1200/Hour OR INR 9000/Day
Experienced: INR 1700/Hour OR INR 13000/Day
Experienced In Demand: INR 2400/Hour OR INR 18000/Day
Note: These are not standard rates. This data depends on some market research and conversation with some freelancers. This number will vary on your client, market and location. Keep your rates flexible. These are just starting numbers!
Now It’s Your Turn!
I learned this ONE thing in my freelance career: Your pricing depends on your skills, experience, and quality of work you offer. Keep experimenting with your pricing.
Which pricing model do you prefer? Do you have any other model? Or got any queries?
I’d love to hear your thoughts in the comment section.
PS. In the next article, we’ll talk about how to onboard new clients and get paid on time. Till then enjoy your coffee!