How much should I charge as a freelancer?
This is one of the most-asked questions in the freelance space, particularly among new freelancers, except perhaps ‘how do I get more clients?’
In this article, we’re going to be discussing the three main methods of pricing as a freelancer: hourly, retained and project. We’ll also be looking at rates with helpful example ranges in dollars and pounds, for:
- Freelance copywriters
- Social media freelancers
- SEO freelancers
- PR freelancers
Table of Contents
A common situation
Home office? Set up.
Website? Looking fresh.
And you’ve got your first sales call with a prospective client in half an hour. Congrats – you’re killing it! Everything is looking peachy.
So, how much are you going to charge them?
Oh my god. You’ve been so focused on everything else you don’t know how much to charge!
Should you choose hourly? Project? Should you put on your Babe Ruth cap, swing for the fences and try to sign them on a big, juicy retainer right off the bat?
“Ugh, there are so many options. If I pick hourly, where do I start? $25? $50? $70? No, that’s too much, I should just pick something I know they’re going to say yes to. Maybe a project would work better though…why is this so hard!? What if they laugh at me? What if I pick a number that scares them off? I don’t want to lose them…but I also want to make money – aaaaaaaaaah!”
Phew. What a mess. Brain goop all over the walls.
Pricing yourself correctly is important. Charge too little and within a couple of months you’ll be burnt-out: stressed beyond belief with mouth ulcers the size of plates and a bank account emptier than the bottle of wine that’s been getting you through the day.
What is happening?
You’ve been working every hour under the sun just to make ends meet. Speaking of, what does the sun look like again?
Charge too much and you won’t get any clients at all. After all, why would a client hire you when they can get someone else for half the cost? Your day looks like this: Wake up. Prepare third pitch of the week. Get rejection email. Post on that Freelancers Facebook group. Rewrite Upwork profile. Again. Have fourth sales call. So bleak. Wonder why everyone else seems to be doing so well and you just can’t seem to catch a break.
The good news is that you are not alone. I don’t know a single freelancer who hasn’t grappled with this problem on a pretty regular basis. Not one.
If you find yourself in either of these scenarios, then pay attention. Pricing yourself correctly is one of the most important aspects of becoming a successful freelancer.
The three types of pricing as a freelancer
There are three common types of pricing for marketing freelancers. Typically fees are calculated on an hourly rate, a retainer or a project basis. Let’s take a look at each one-by-one.
This is a common method of billing used by freelancers in social media, SEO, copywriting and PR. For every hour you work, you bill the client based on your agreed hourly rate.
For example, you agree a rate of $50 per hour and you work for 10 hours. You charge the client $500 (your hourly rate multiplied by the number of hours completed).
Occasionally, you’ll hear the term ‘day rate’. This is just the hourly rate multiplied by the number of billable hours in a day (usually seven or eight). For now, we’ll just focus on hourly rate.
The pros of hourly pricing
- This is easy to understand for both clients and freelancers alike. If you work fewer hours, you’ll charge the client less. If you work more hours, you’ll charge the client more
- If the work takes longer than you thought it would, you still get paid for any additional time
- You can agree a maximum number of hours to complete, at which point you’ll stop. This reassures the client that they’ll never have to pay more than what they’ve budgeted for
- Hours are easy to keep track of and calculate. Just use an excel spreadsheet or time tracking software and invoice the client for the total
The cons of hourly pricing
- As you become more experienced, tasks will take you less time to complete. Therefore, you have to continually raise your hourly rate to make the same amount of money
- Hourly rate often fails to fully capture the value you deliver to clients. If you make a change to a client’s website that makes them a lot of money, should it matter whether it took you half an hour or three weeks?
- To make more money you either have to increase your hourly rate or work more hours. There are a finite number of hours in the day which puts a cap on your ability to earn more
Summary – best for new freelancers
Hourly rate is the easiest way for freelancers to begin their career. I recommend most marketing freelancers choose hourly rate to start with, and gradually explore billing on a project or retainer basis once more established.
This is an agreement between the freelancer and the client that sets up a long-term ongoing relationship. The freelancer completes work each month and bills the client regularly, with the expectation that this will carry on for the foreseeable future, until either the client or the freelancer hands in their notice to end the contract. Notice periods are typically between one and three months.
The pros of retainer pricing
- The client doesn’t have to find a new freelancer every time they have a new project
- The freelancer has a more secure income, doesn’t have to find new business for the next month and is able to plan ahead
The cons of retainer pricing
- It is usually harder for a freelancer to sign a client to a retainer than on hourly rate, as they are worried about being tied in to a long-term relationship if the freelancer doesn’t produce work of the expected standard, is hard to work with, or they have unforeseen cash-flow issues
- Unless they’re moving from in-house or an agency, new freelancers are not able to show the results and experience required to convince a client to sign a retainer
- Retainers aren’t applicable to all types of work. Many types of work are one-off and would be better served charging as a project or hourly work
Summary – best for freelancers with demonstrable results and well-established processes
Retainers have many positives, and as a result are often the bread-and-butter of successful freelancers. The ability to have secure, planned income and not spend so much time finding new clients/business (selling them on why you’re so great, and then spending time learning about them, pitching them, onboarding them etc.) is very valuable. However, new freelancers will struggle to get clients as easily using this method, and may risk turning a client off if they push this option to vigorously – for many freelancer newbies, it’s a better option to choose hourly billing.
Charging clients on a project basis can be a good alternative to charging per hour. Instead of completing the work, noting down the numbers of hours it took you to complete, and billing the client, you offer the client a fixed price beforehand for which you’ll deliver the results.
The numbers used below are for example purposes only.
- Social media freelancer – $1,500 for delivering a social media calendar for two platforms
- Freelance copywriter – $100 for a sales email
- PR freelancer – $200 for a press release
The pros of project pricing
- With experience, you’re able to deliver superior results in less time than a novice. This allows you to make more money while working fewer hours
- The client pays a fixed amount, which gives them piece-of-mind that they won’t be charged more if the work takes longer than estimated
- This pricing model can result in a larger income than using hourly rate
The cons of project pricing
- If the project is more time-consuming than imagined, you spend more hours carrying out the work, which eats into your expected profit margin
- The ability to price projects well takes experience. You can end up pricing too low, in which case you may have made more money using hourly billing. Alternatively, you can price your project too high, and scare off potential clients who would have been more likely to sign-off on your quote had you used hourly billing
Summary – best for experienced freelancers with work that’s likely to be a one-off
- More experienced freelance marketers should give serious thought to using project pricing. Yes, you’ll probably make mistakes at the beginning, but the ability to make more money by working fewer hours makes it all worthwhile. In a year’s time, your bank account will thank you for it
Working out Project pricing
When working out how much to charge for a project, many people estimate the time it will take them to deliver it, multiply that by their hourly rate and add a few hours as a buffer for unexpected issues.
An alternative is value-based pricing. Be warned, of all the pricing strategies we’ve discussed, this is the hardest to get right. But it also has the potential to earn you the most money.
With value-based pricing, you look at the tasks or objectives you’ve been given, and evaluate how much that would be worth to the client. For example, if you’re asked to write a series of emails for a new product launch, and you’re confident you can generate $100k in sales through your work, then you may decide to charge them $5k or even $10k for the project.
Or, if you’re a conversion copywriter, and typically your results generate a 20% uplift in sales, you can estimate what 20% extra sales would look like for a potential client, and charge them based on that figure.
The size of the client is very important in this method of pricing.
A 20% uplift in sales for a client who makes $10k per month is $2k.
A 20% uplift for a client who makes $300,000 per month is $60k.
Both might involve a similar amount of work, but the second client is going to be able and willing to pay you a lot more to deliver those results.
The pros of value-based pricing for projects
- This method isn’t directly linked to time. You can work fewer hours and get paid more for them
- As we all have a limited amount of hours, this is the most scalable of all the pricing methods in this article
The cons of value-based pricing for projects
- It can be difficult for beginners and even veterans to get this right. It feels uncomfortable and you’ll inevitably make a lot of mistakes with this at first.
- The freelancer has to have a demonstrable track-record of generating results and has to be extremely confident in their ability to deliver
What are the main factors that impact what I should charge?
No two freelancers are alike. Different needs, skills levels and situations require different fees. Let’s take a closer look at the most important factors when deciding how much to charge as a freelancer.
Number of years’ experience
If you’ve just started out in the industry, you’ll charge less than a 10-year veteran. Three years’ experience means you can charge more than a newbie.
What happens if you’ve been in the industry for a while, but are moving from an agency or in-house to pursue a career as a freelancer? You don’t have to work your way up from the bottom, just skip straight to the equivalent rate for the total number of years’ experience you have, regardless of where you were employed.
If you’ve generated incredible results for a client in a relevant industry, future clients will be happy to pay you more. The more stellar reviews and customer testimonials you have, the more you can charge.
Often, the longer you’ve been around, the more results you’re able to point to. However, this is not always the case. I know freelancers who have worked for two years that are able to charge much higher rates than those who have freelanced for ten years, because they have generated truly impressive results and have been particularly savvy in how they’ve built up their reputation.
Competition (supply and demand)
If you’re a freelance version of Liam Neeson in Taken, and you have a very particular set of skills, then congratulations, you’ll do well as a freelancer.
If you’re the only one that can solve a problem (limited supply), and that problem is important to the client (high demand), then you have a licence to charge a large amount to deliver it to them. Essentially, you have a monopoly on the market.
If there are millions of people who do what you do, or clients can make do without it, then you’ll have to charge a lot less, and you’ll be viewed as a commodity. With commodities, people tend to gravitate towards the lowest-cost provider, and it ends in a race to the bottom. Not good for you as a freelancer or your bank account.
If you’re in the latter group, then all is not lost. There are two ways out of this trap. You can improve your skillset through training and experience. Or you can niche down, which shrinks your competition.
So instead of marketing yourself as a social media freelancer, and competing with a million others, you can market yourself as a Facebook Ads specialist, who only works with sustainable fashion businesses based in Australia. The more you niche, the fewer clients there will be, but the more you’ll be able to charge, as you become known as the specialist in that area.
Those who are thinking about becoming freelance marketers often forget that they’ll have expenses that they wouldn’t have as employees.
Here are some of the expenses you should factor in when deciding how much to charge:
- Pension contributions
- General – invoicing and accounting, Microsoft Office, project management tools etc.
- Specialist – this can quickly mount up. Social media freelancers may use tools like Hootsuite and Buzzsumo. SEO freelancers may use SEMrush or Ahrefs. PR freelancers may use Media Relations software.
- Co-working space
- Website development and hosting
- Budget for third parties – developers, accountants etc.
Cost of living
Depending on where you live and the lifestyle you lead, you’ll have a certain amount of money that you need to generate each month in order to afford the essentials: things like rent, food and keeping your pet monkey in his finest glad rags.
If you live in India or Bali or Thailand, you’re typically going to need a smaller income than if you’re based in the US or UK. However, this doesn’t mean that you should charge less if you’re based in a country with a cheaper cost of living, just that you need to make sure you’re making enough to get by if you live in a more expensive part of the world.
Most freelancers will have lots of non-billable hours, especially at the beginning, before they establish a solid client base. Every hour you spend pitching, training, marketing yourself and doing draining admin tasks like chasing invoices are hours where you won’t be making any money. Make sure you factor these into your rates.
Is the client right for me?
An old boss used to say you should only work with a client who’ll make you rich, make you happy or make you famous. If working with a particular client will make you happy, and they can’t afford your rates, then you can give them a discount. If a prospective client will help you break into an industry and get future work, but their budget isn’t big enough, you can cut them some slack.
But if they can’t make you happy or make you famous, then they better make you rich. If you have a client approach you in an industry that’s not your target, then charge them more. If you have a client with work that you don’t really want to do, then charge them more.
Elise Dopson took this advice and when a client approached her in an industry that she found boring, she doubled her rate. To her surprise, the client accepted. This gave her a much larger incentive to carry out the work, and she wouldn’t have minded if the client had balked at the price and walked away.
How much can the client afford to pay?
Companies that make less money probably can’t afford to pay you as much. Clients that are big multi-nationals will typically have far bigger budgets and be more willing to spend larger amounts of money. In fact, if you try and charge a large company a smaller amount of money, it often has a negative effect – they’ll look at you and judge you as less-competent or experienced because you’re charging less than their other suppliers. They expect to pay for quality, and when you’re cheaper than expected, they often take this as a warning sign.
What do freelance copywriters charge?
According to a survey by ProCopywriters, 50% of copywriters charge a project fee, and 47% of copywriters charge by the hour.
It may make sense for freelance copywriters to use multiple methods of billing, depending on the work required.
The same survey found that copywriters based in the UK had an average day rate of £342 ($423) and hourly rates typically fall between £30 and £100 ($37 and $123).
The most popular freelance copywriters on Upwork have rates of $100-$150.
What do SEO freelancers charge?
According to a survey by ahrefs, SEO freelancers charge an average of $68 per hour.
However, the survey also found that almost 40% of the SEOs that were surveyed used only a monthly retainer, and didn’t use either hourly or project billing. Of the retainers, 19% charge between $251-$500, 23% charged between $501-$1,000 per month, but more than 24% of retainers are at least $2,001 per month.
In terms of projects, they found that over 50% of all respondents charge at least $1,000.
On Upwork, the most popular SEO freelancers charge between $50-$100 per hour.
What do social media freelancers charge?
According to FreeTrain, these are the ranges generally seen in the UK:
- 0-3 years’ experience – £10-£35 per hour
- 3-5 years’ experience – £35-£70 per hour
- 5-10 years’ experience – £70-£100 per hour
And when converted to USD:
- 0-3 years’ experience – $12-$43 per hour
- 3-5 years’ experience – $43-$86 per hour
- 5-10 years’ experience – $86-$123 per hour
Social Media Strategies Summit suggest a similar, but slightly higher range:
- 0-3 years’ experience – $15-$50 per hour
- 3-5 years’ experience – $50-$100 per hour
- 5-10 years’ experience – $120+ per hour
On Upwork, the most popular social media freelancers charge between $30-$50 per hour, suggesting they are less valued on the platform, perhaps because of the large number of freelancers available.
What do PR freelancers charge?
London Freelance offers a comprehensive guide to fees, with their hourly rate for PR freelancers falling mostly between £38 – £65 ($47 – $80).
Most of their pricing is geared towards projects, with press releases set at £160-£350 per 1,000 words ($198 – $433).
On Upwork, the most popular PR freelancers charge between $50-$100 per hour.
Still not sure what to charge as a freelancer?
If you’re a newbie, then my best advice is to choose hourly rates, and pick a number in the low range of the numbers above.
Pick a competitive rate and see how the market reacts. Give it a month and really put yourself out there.
Pitch, pitch, pitch.
Are you managing to secure work? If so, that’s great. You can raise your prices slightly and see how your success rates change when talking to potential clients. If not, then you might need to get more experience at a lower rate, or change how you’re marketing yourself.
Although it can be hard to do, it’s worth talking to clients that turn you down and asking whether your rates where a factor in their decision or if it was something else that you can work on.
Good luck to you, and congratulations for taking another big step on your freelancer journey!