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jeudi 3 février 2011

Signs Your Rates Are Too Low

There are plenty of situations that will tell you that your rates are too low. The best response to any of these situations is to raise your rates.
  1. Your clients accept your rates with no complaints whatsoever. If a client hasn’t at least said, ‘that’s a little higher than I was accepting’ when you send her an estimate, you’re in trouble. Most clients will want to at least try to negotiate downwards, no matter the price point, unless they find a freelancer who they think is a real steal.
  2. You haven’t raised your rates in over a year: Between the experience you’ve gotten and any increases in cost of living, it’s reasonable to raise your rates (at least for new clients) every year.
  3. Your rates aren’t in line with what other freelancers are charging. When I first started freelancing, I heard about another local freelancer who was charging triple what I was (I’m not going to give you the dollar amounts because I’m a little ashamed of what my starting rate was). She wasn’t particularly experienced or skilled compared to me, but she was getting what she asked for. You better believe I raised my rates immediately.
  4. Your budget is perfectly balanced: A perfectly balanced budget isn’t a good thing, at least for a freelancer. If just one missed payment from a client would throw your budget off entirely, you’re not bringing in enough money. A perfectly balanced budget (even if you’ve budgeted for savings and retirement) means that you still have room to stretch.
  5. You’re charging less than double what you could make hourly working for an employer: In most places, freelancers ought to be aiming for at least double what an employer would pay because that’s the real amount an employer earmarks for salary, taxes, benefits and generally the cost of having an employee.
There are, of course, more obvious signs — like you’re eating ramen for the third week in a row — but it’s the subtle signs that I particularly worry about. If you’re in a tough spot financially, raising your rates is probably an obvious move. But if you are getting by or you’re even comfortable, you might not think of raising your rates. But if your work, between skills and experience and general ability, is worth a higher rate, you should be getting it.

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