Asking your boss for a raise is always nerve-racking, but it’s often worse when you’re freelancing. Freelancers have multiple clients — each with their own budgets and temperaments — and it’s understandable that you don’t want to risk alienating any of them by asking for a pay increase.
Even so, negotiating a raise is vital to staying in business as a freelancer. Inflation and cost of living increases will eat away at your paycheck if you keep working at your starting rate. Plus, the longer you work for a client, the more skilled you become, meaning you should be paid for your increased value.
If you’d like to know how to set a competitive rate, be sure to read Hectic’s article on increasing freelance rates. Here, we offer six tips on a related but equally important topic — how to talk to your clients when asking for a raise.
When you’re starting out as a freelancer, it can be tempting to take whatever job comes your way and just accept the rate your employer is offering. Sometimes you don’t have a choice, especially if your client has a large workforce with an established wage for all freelancers.
Other times though, your client will ask you to name your rate. This often happens when your employer is a small business owner or runs a startup company and just needs a few talented freelancers to tackle set tasks.
When this happens, take advantage of the opportunity. Do some research to calculate a fair but competitive rate for freelancers like you. Work out a market standard rate based on your baseline cost of living, business expenses, taxes, and the number of hours you can (and want to) work on a project.
Your level of experience will also be a factor — but don’t let this pressure you into lowballing your fee. Spend some time learning about the range of prices other freelancers in your field charge and position yourself to level up.
For instance, many beginning freelance writers earn around 10 cents a word (or $100 per 1000 words) at content agencies. So, if you caught the attention of a client, ask for a higher rate, like 15 or 20 cents a word. Even if they don’t agree, you can still negotiate for a slightly lower rate that’s better than the usual beginner rate. Remember: it’s always easier negotiating down than up, so start with a high quote.
All freelancers need to have a written contract with their clients that spells out their job responsibilities and compensation. To make sure you’re not trapped working for the same payrate indefinitely, include contract clauses that schedule times for meeting, reviewing, and renegotiating the terms of your contract. This will establish set times to ask for a higher salary, saving you the pressure of having to unexpectedly approach your employer for a raise.
Just how often you should arrange these meetings is up to you. Some freelancers like to meet quarterly, every six months, or once a year to re-negotiate their contracts. Knowing that these meetings are coming up will also give you plenty of time to prepare for negotiations, using some of the tips below.
The longer you work for a client, the more valuable you become to them. Not only do they get used to having you provide them with excellent work on a regular basis, you also get to know their company’s needs and plans for the future.
Take advantage of this. When the time comes for you to renegotiate your contract, offer your client additional services to help them reach their long-term goals. For instance, if your client wants to improve their search engine optimization (SEO) strategy and rank higher in online searches, offer to include keyword research in your blog writing services. Or if your editor is overloaded with work, offer to take on certain tasks like image sourcing to make their job easier.
These tasks don’t have to eat too much of your time. In fact, as you keep working for your client, you’ll find your overall speed and proficiency at completing your tasks will improve. Smart freelancers also invest in themselves by taking courses and adding to their existing skillset so they can provide more benefits for their employers.
And since you’re in a position to offer more benefits and services for your clients, you’ll also be in a much better place to negotiate a higher payrate. Keep in mind: negotiations often go better if you can show your clients specific deliverable ways you can continue to be valuable for them.
Offering an explanation for your pay raise can make your request seem more reasonable in the eyes of your clients. Simply asking for a 10% raise might not go over that well — but if you can explain how that extra 10% goes into paying for the paper, ink cartridges, higher Internet plans, and cell phone bills you need to provide your clients with good service, then your request becomes more understandable.
This won’t always work on everybody, and there will be times when you lose clients when you raise your rates. Even so, it’s worth noting that your best clients will offer accommodations for your expenses.
For instance, I recently contacted a client to let her know PayPal was taking a percentage out of all the paychecks she delivered to me. She immediately wrote back, letting me know I could add the amount of the fees to my invoices so those extra expenses would be covered.
It was a quick email exchange that will save me hundreds of dollars in the future — but it never would have happened if I’d been too scared to broach the subject.
Just because you’re charging your existing clients $50 an hour doesn’t mean this has to be your freelance rate for all of your clients. If you find yourself negotiating with a new client, ask for a higher rate than your current ones to see if they recognize your value. Best case scenario, you’ll receive a contract that pays you far more than your other assignments — giving you the confidence to raise your rates in future negotiations. Worst case, the client turns you down — but you’ll still have your existing clients, so you’ll be doing well.
Incidentally, collecting different wages from different employers does mean you’ll want to invest in some bookkeeping software. See how the Hectic App can help.
This final tip might seem a bit counter-intuitive. After all, isn’t the whole point of re-negotiating a contract to continue working for your client?
Well, yes — but sometimes things just come to an impasse and it’s much better for all parties if you just cut your losses and move on. Maybe your client’s company had some budget cuts. Maybe they don’t need you to provide the same amount of work they needed from you when you started. Or maybe you picked up a lot of new clients and can’t offer them the same amount of time you once did.
Whatever the reason, it’s important to be honest with your client about where things stand with you in your current freelancing career. Clients do come and go for freelancers, and if you feel your current work relationship isn’t as mutually beneficial as it once was, you need to be upfront about this.
Occasionally, this can result in some extra leverage for you if your company decides they want to keep you and start offering additional perks — including a higher salary. If this works for you, by all means take it — but be honest with yourself. <tweet-link>Freelancing is as much about personal growth as it is about money, so don’t get overly attached to a client if you feel your future lies outside their company.<tweet-link>
Being a freelancer gives you a chance to make money on your own terms — but in order to earn a decent wage you need to know your own worth and communicate it to others. While you may have started your career working for low rates, there’s no reason you have to keep doing that in the long term.
Schedule time to re-negotiate your salary, showcase your growing value, and keep your eye on future clients. Remember: you’re offering a valuable service and there are plenty of clients out there willing to pay top dollar for your skills.