If you have read my article, Rate Setting, you have followed the calculations that show a freelancer's $77/hr fee equates to $45,000/year for an employee. In an ideal world, all firms would be paying a living wage and would take into account a freelancer's overhead when shown the $77/hr or higher rate.
But how many of us actually charge that hourly rate? Not most of us, sad to say!, Freelancers, especially those just starting out, do not have clients that will pay these reasonable rates. After all, prospective clients can easily find others who do an acceptable job for a lower rate.
That is why the Rate Setting Guideline is just that - a guideline. All too often, folks starting out as freelancers haven't a clue as to how to determine fee ranges. A fee of $15/hr or even $35/hr might sound really good until they look at this hourly fee from an overall perspective.
As an employee you know that taxes are deducted from your paycheck, that
you may make 401K deductions, and that you get a certain number of paid
holidays and sick days each year. In fact, in the past few years, it has become standard procedure for businesses to tell employees that their actual income equals the number of dollars in their paychecks plus their perks. (Although I found it difficult to swallow when a former employer once proudly told me that my taxes were a perk.)
If we are to survive as freelancers, we must consider all of these factors. There is no one right answer. The right answer is the one that brings you enough work to earn a living and lets you continue to land more work.
Like everyone else, I weigh the option of being paid against the stack of
unpaid bills sitting on my desk. It's nice to have principles, but can I afford to turn down a $700 job when the rent is due? Sometimes the answer is yes and sometimes the answer is no. As a freelancer, I have the flexibility to make some of my own rules. I'm not an employee. I decide what my bottom line is.
When a prospective client offered me a $700 job it was tempting for about two minutes. I had already calculated the minimum time needed to do the job; at the absolute best, the job would have taken 125 hours. I was not willing to work for that hourly rate. But not long ago I did tackle a different short-term project that came out to be the equivalent of $8/hr. Why? Because the total sum I received for the project very nicely covered an immediate bill that I had to pay.
Freelancing is even more challenging when you are trying to support a family because a steady income becomes even more important. Can it be done? Yes. But then you must consider the variables that led to the $77/hr income figure.
Freelancing is a strange way to make a living. You have a goal, a target income, that you strive to meet. You learn to juggle your time and your income. But you won't last as a freelancer if your total income is way below your projected goal. This is just a fact of life. We need to make a certain dollar amount to stay afloat.
As for what type of work you do - I'm not so sure that it makes all that much difference. Employed editors may not make the same, perhaps, as copyeditors who may not make the same as pre-press developers who don't make the same as... You get the drift. But the bottomline is that, no matter what field of work you are in, you need to make a living.
The $77/hr rate does seem high. And yes, clients will balk. And no, you sure
aren't going to start out at that rate. But the facts don't change - if you want
to earn the equivalent of a full-time employee with the same general income
and perks, that is what you need to make as a freelancer. If you don't, you are
kidding yourself that you're on the same income track as an employee. Which may be fine with you! Just know the facts.