What to charge for freelance work

This is a question a lot of people ask. What should I charge? What am I worth?

If you've done any research, you'll probably realize that there's no one right answer. A combination of what you do, your skill level, and your client all make up an ideal rate for a project.

An hourly rate

The first thing you need to do is figure out what you feel is a good hourly rate. Maybe this is where you're stuck. That's ok, we'll work through it. What you first need to consider is: how much would you like to reasonably make? If you're just starting out, the best advice is to follow your gut. If $50/hour seems too high for the work you can deliver, maybe it is. If $30/hour seems a little low, again, it probably is. You have to consider that as a freelancer, you're no longer getting health benefits. You no longer have the guarantee of a full-time job offering you 40 hours a week. No sick pay and no vacation time. And don't forget taxes, which as a self-employed person, you now have to pay more, around a third of your income. You are also, theoretically, a specialist in your field that is being hired specifically for those skills. Maybe $50/hour isn't so crazy after all. (Maybe after considering everything relative to your skill level, $100/hour isn't so crazy, either.) 

The next thing to consider is: what is your bottom dollar? If someone hires you for $20/hour, booking 50 hours of your time will only cost them $1000. Charging too little will sink you. You'll get bad jobs and they will take up too much time. If you're dedicating all that time to one underpaying client, you won't be able to pursue other work, take on new projects, or have any time away from work.

Generally speaking, I try to avoid taking on projects on an hourly basis, and I'll discuss why below. Ultimately, this number should serve as your baseline. If you are consistently getting work and getting better, start to raise that number. After a year, give yourself a raise, just like any other job. If you have stuck with freelancing for a year, you've definitely learned a ton of lessons and should have almost certainly increased your skill level.

You might make some mistakes on your first few projects. We all do. You may charge too little, or they may just not turn out very good. That's nothing to be afraid of, it happens. But if it feels like you're not making what you are worth or are being taken advantage of, you probably are. The best advice I can give is to wrap up those projects and go your separate ways. Once you get a feel of how much time you're putting into work and how much you're coming away with each month is when you can make a truly informed decision on how much you should charge.

Your skill level

This is the big question mark, especially when starting out. How good am I? Can I do what they want?

You should have some idea of what you are capable of and what you can deliver. You will make mistakes and learn new things along the way. Some projects won't go as well as you had hoped, but hopefully that's a small number in comparison to the bigger picture.

This is the single biggest thing that will increase your rates. If you're a web designer, come up with some personal projects you want to pursue, or make a website for a friend or family member. If you're a videographer, make a short film with your friends, or just go film around your town. If you're a photographer, you have no excuse to not be taking pictures every single day. Make mistakes on these projects so you'll make less on the big ones. You'll learn about design, lighting, audio, etc.

As you have better projects in your portfolio, your value becomes more obvious. Sprinkle this in with some client work and you'll soon have an impressive website. Bigger companies and opportunities will come calling.

If you're not sure you're ready for freelance work or don't feel like you can charge a fair rate yet, this is even more important. Do as much as you can to improve your skills. Read, consume work from those that inspire you, and get involved in some communities built around your craft. As you get better, people will start noticing your work. Maybe a successful freelancer will bring you on to help out with their project when they get too busy or need more help. I know I've done this multiple times. This will build relationships and suddenly you have someone you can trust who you can just ask: "Hey, what should I be charging for this stuff?"

Freelance project rates

As I said above, I like to book projects on a flat rate rather than hourly. This can be a rate per day or for the entire project.

One reason is that it's much simpler. As you take on more work, you'll get a better idea of how long it takes you to complete a task. You'll also get better as you repeat those tasks and come up with systems for your work. You shouldn't be punished for working quickly, after all, your client should be paying for your experience as much as the labor of your services. Estimate how long you expect a project to take, including things like meeting times, travel, and revisions. Come up with a number based on your comfortable hourly rate multiplied by the total time you expect to take.

If you do this, then you're not tracking every minute in a spreadsheet or on paper. There aren't questions about if time spent on phone calls are charged by the hour, because they should be built in to your flat rate. A 15 minute phone call might not seem like it's worth charging for if you charge $40/hour. If your client makes six 15 minute phone calls over the course of a project, that's suddenly an hour and a half of your time that you didn't get paid for.

I base my day rate on 10 hours. On some projects, a day may be 12 hours, others it's 8 or 9 hours. You'll feel this out as you get more work.

Another advantage is that it's easier to manage your schedule. If someone hires you for 20 hours of your time, they may need two hours a day for the next 10 days. Or, you could say 20 hours is two full days or four half days, and that you'll exclusively work on their project between these times. I've found this to be really helpful during revisions. When I say, "Ok, I've blocked off 10 hours on Tuesday to make any necessary changes, I'll need all your feedback by then," things are much more organized than if I add one bit of feedback on Friday, get more on Monday, add it, more on Wednesday, and so on. 

In the end, you might be making what you made if you charged hourly. Occasionally, you'll make less. This can suck, but it happens. The lesson here is to be very clear up front about your services and terms. Usually this happens when tasks continue to be added to the project, it wasn't represented correctly, or you just miscalculated. The first two issues can be resolved with a clear contract. The third, you'll just have to learn for the next time. To avoid this as much as you can, be clear not only about the terms, but also what any extra charges may be if, for instance, there is an extra set of revisions. As long as the reasons for another round of revisions aren't you fault, the client should understand that it's outside of your original agreement and be ok with paying you for the extra time.

The magic with charging a flat rate, though, is that on some projects, you may make more than your normal hourly rate because things went smoothly. That's great, because if things went well that means the client should be thrilled. Guess what? They no longer care if they just paid you $100/hour. You totally wowed them.

So, what should I charge?

Sadly, there is still no exact answer. Hopefully some of my writing has brought up points you didn't consider, or maybe didn't consider strongly enough. Like with all areas of freelancing and creative work, a large part of it is following your gut and listening to your head. If you keep thinking you should be making more money, you probably should. If you're afraid you can't offer good value, you may want to proceed with caution.

Figure out a good hourly number. How many hours do you want to work to make a living? Figure out how many projects you can reasonably take on, and be smart about scheduling out your time. Improve your skills, hone your craft, and maybe even focus in on a niche market. As you can better serve your clients, you can ask for more money. It's a process, and with some practice, you'll figure out what works for you.

(Disclaimer: I shouldn't have to say this, but here it is anyway. If you need financial advice, you should always seek out a trusted, professional financial advisor. I am not one. I am simply sharing some practices that have worked for me as a freelancer.)

If You Want A Discount, Read This First

From "Speaking for Yourself" by Merlin Mann (via Marco Arment):

Things cost money. People either pay for them, or they don’t.

We are gentlemen, and we can disagree on value, but it’s unseemly to tell another gentleman what he’s worth. Learn this fast fast fast.

Any creative professional knows what it is like to have someone ask for discounted or free work.

There are a lot of problems with working for a discount. Below are just a few that come to mind.

Everybody is less invested with the project. It's very simple when you think about it. Have you ever had a really nice pair of sunglasses? I used to go through pair after pair of cheap sunglasses worth $20 or less. I would drop them, break them, and lose them. I didn't care. I picked them off the shelf at the drug store, so I'd just replace them with another pair. Over the course of a few years, I couldn't tell you how much I spent on sunglasses. So when I bought my first "expensive" (over $100 but less than $200) pair of sunglasses, I suddenly cared. In three or four years of owning them, not once did I drop or scratch them.

I was invested. I knew the value of the product and that they couldn't be easily replaced by another cheap alternative.

Creative services can be similar. If you can't afford a videographer that wants to charge $3000 for a wedding, that's ok. But don't ask that same videographer to work for a fraction of the price. For any reason.

(Read: Why Video is Expensive)

It's ok to seek out someone that's in your price range. Just realize that a cheaper alternative may not be able to provide the quality, experience, or value you are looking for out of your project. So is the money or the quality more important? (It's totally fair if the answer is that the money is more important.)

I appreciate it when people realize my time is as valuable as their time. When someone does their best to figure out how we can make a project happen in a fair situation, I do everything I can to make it work. 

(Tip: Don't just ask what it would cost to create something. Explain what you want and send any relevant details. Then ask for a rough quote based on the information provided. I can just give you my "day rate," but that number may seem high unless you realize what I'm providing and what it will take for the project to be a success.)

Another issue, especially for video, is that it often takes a team of people to complete a project. So if you're asking me for a discount on a big project that requires multiple resources, that means you're also asking me to ask those people for discounts. I don't want to be someone who asks friends and colleagues for free or cheap work.

Regarding work for charity or non-profits... a lot of people assume this means you should want to work for free. I care about a lot of causes.

But if I want to donate my time to a project or a charity, I will offer it. Just because it is your charity doesn't mean I'll jump at the chance to donate my time.

If you think, for some reason, that you should be given a discount on your project, write me a five paragraph essay explaining why. I'll read it. But, if that sounds as ridiculous as I think it does, please reconsider before you ask me to work for free. Unfortunately, at the time of writing, a "great piece for my portfolio" is still not an accepted form of payment for my rent.

Why Video Is Expensive

There are some great articles as to why photography isn't free or cheap.

Let me start by saying video isn't expensive. Including the companies that spend a million dollars on a thirty second commercial. It's all about value. If you don't consider value as your top priority (or as the producer can't communicate valu), the numbers really don't matter. Value can be had for $1,000 or $1,000,000 depending on your situation and perspective.

But to talk about some numbers for a minute, video production is very similar to photography. Especially in today's world where so many videographers (myself included) actually shoot video on a DSLR, a lot of the equipment and costs are the same.

Here are some things to consider when looking to schedule a video shoot:

The camera. That's the most important thing, right? good, professional (and current model) camera is going to cost at least $3,500. Many production companies and people with the money to afford it are moving to the Canon C300 or RED cameras. They cost the equivalent of a new Honda Civic (or more).

You can get by on less. I did for awhile. Eventually it will catch up to you, usually at the worst possible moment.

The lights. Lighting is the single most important thing in making a video look great. To get a professional kit, you're looking at another $2,000 or more. There are lights for photography that can cost over $10,000 a piece. Crazy, huh?

The audio. This is actually the most important thing to a great video. Wait, did I just say the camera, lights, and audio are all the most important things to a great video? (Yes.)

A basic audio setup ith a professional grade microphone and recorder is another $1,000. If you want to get wild, well, the sky is the limit.

The people. The people! They are the ones you've hired, after all. It's their years of experience that you're relying on, the mistakes they've made in the past that they won't make again, their efficiency, resources, quality, and creativity. They're the real secret sauce!

But before they can even walk in the door, they need that experience, and all the equipment listed above. And batteries, memory cards, enses... you get the idea.

The time. The big multiplier in the equation. A small production will usually take a half day, anywhere from 3-5 hours. Other productions may require much more time, and possibly travel.

After the production is complete, on to post-production. The editor can spend anywhere from a single day to weeks mporting, organizing, syncing, editing, color grading, adding graphics, exporting, revising, exporting, revising, and exporting again. All on a computer powerful enough to render high definition video and software ranging from hundreds to thousands of dollars.

This isn't to say a good video needs to cost $20,000. Quite the contrary. The point is those budgets exist, and are often totally justified. The key is to recognize and respect all the components that go into a production to determine its true value.

If the goal is to attract new customers with your video or to remember your wedding day forever, consider the true value that represents to you.

Just don't be surprised if you contact someone and their rates are much higher than you expected. They probably wouldn't be asking that much f they weren't confident in their abilities and of the value they have provided previous clients. Chances are, if you want to hire them, a lot of other people do, too.

We also won't be offended if your budget just doesn't match our rates. Just don't ask us to sacrifice the quality of our work in order to get a discount. And never ask someone to work for free. We value our time as much as you value your own.

The point here isn't to talk down to anyone. It's also not about trying to nickel and dime a client. The point is that there is fair value for everything. What you can afford may not match up, so it's a matter of determining what is most important to you.