How to Negotiate Salary as a Freelancer: Get Paid What You’re Worth

There are a few tough talks you’ll need to have during the course of your freelance career, like managing a difficult client, handling a performance review, or resolving a misunderstanding. Negotiating a salary is normally the first one. Funny enough, a lot of freelance workers never actually have this conversation. They’re either too excited or anxious...

There are a few tough talks you’ll need to have during the course of your freelance career, like managing a difficult client, handling a performance review, or resolving a misunderstanding. Negotiating a salary is normally the first one.

Funny enough, a lot of freelance workers never actually have this conversation. They’re either too excited or anxious about their new job that they readily accept the first offer on the table. This leaves them with a current salary that could have been significantly higher if they had just asked for it.

Finances, of course, are always a touchy topic but one that’s necessary in business. And if you want your freelance business to be profitable, you’ll have to start discussing money matters eventually.

This post will help you do just that, with tips on how to comfortably and successfully get the compensation you deserve.

Know Your Worth

As a freelancer, you’ve probably done similar work before, whether for a former company or a previous client. If this work was in the same industry and not too long ago, the payments you received will be a good starting point. On the other hand, if you’re entering a completely new industry, it’s best to ask someone with experience or do a quick online search to get a better idea.

No matter where your numbers are coming from, however, they will likely need to shift a little. When you start working independently, you have a few new expenses to shoulder — like your own marketing efforts, office space, self-employment tax, and healthcare. All of these must be added to your base annual salary requirements, and that total is now your new annual salary requirement.

But how does this translate to a project? To break your annual salary down to project size, you’ll need to first calculate your number of billable hours a year. Do you want a 6-hour work day? Are you planning a 3-week vacation? Be realistic when estimating how many hours you plan to work, and then divide your annual salary expectation by these hours to get your hourly rate.

Calculate Your Minimum Acceptable Rate

Your hourly rate, however, doesn’t need to be the rate you present to clients. Rather, it’s the bare minimum acceptable rate you should accept during salary negotiations. It’s basically your bottom line.

The minimum acceptable rate often changes, depending on where you are in your freelance career. If you’re just starting out, maybe it’s based on your current quality of life (i.e., Uber budget, WeWork space, eating out). But as your business grows, your minimum acceptable rate may increase to reflect the quality of life you want in the future (i.e., office rent, gas for your car, employee salaries).

Determine How You Want to Be Paid

There are two ways a freelancer can structure their payment — per hour or per project. Per hour rates are generally better for projects that tend to have a lot of revisions or are likely to expand their initial scope. They might also make it easier to land a contract, as per hour rates initially seem to be more affordable.

Per project rates, on the other hand, are a lump sum that clients can conveniently factor into their budget. They also makes the process of down payments and final payments much smoother, as the prices have already been agreed upon.

Some clients may prefer one over the other, so it’s good to be flexible and accommodate both. Or you can also target projects that cater specifically to your preferred payment method. For example, Upwork is a website where freelancers typically charge per hour, while Fiverr and Glassdoor are priced per project. Guru offers both options, with the convenient ability to filter the job search by payment.

Talk to Your Network

Woman talking on her cell phone

If you still need advice on negotiating salary, don’t be afraid to reach out to other freelancers in your field or network. You’ll be surprised how willing they are to help a fellow freelancer, not just with their take on fair rates, but also with other tips to better negotiate and navigate the industry.

An added benefit? Connecting with other freelancers creates a sense of community that’s welcome when you’re in the freelance world.

Get Ready to Negotiate

For some, the very thought of negotiating is an unwelcome one. But no matter what you may think, being able to negotiate effectively will do wonders for your freelance work. Negotiating is a fact of business life for many people. Even if they can easily afford the fee, some may haggle just for the sake of haggling.

But if you’ve done your due diligence and are confident you deserve your rate, then ask for it. Don’t give in on a starting salary you’re not happy with because you don’t want to lose the client or negotiate. Yes, you may have to compromise — remember, good negotiation leaves both parties feeling like they got a good deal — but you also don’t have to just take the first salary.

Silence — and a little bit of stalling — is a strategic tool in the negotiation process. Let the number sit on the table for a while and feel free to ask more about their basis for the job offer (i.e., “May I ask what the budget is based on?”). Many times, the client will be able to find ways to improve the first offer, either with an increase, added perks, or even a benefits package.

Set a Higher Salary

It’s good practice to give yourself a little wiggle room and propose a slightly higher salary offer. While it may seem like a bold move, it’s really a good way to safeguard against the negotiating curve.

As long as your rate is still within the reasonable ballpark — say, 10-15% higher — a client may counteroffer, but is highly unlikely to reject it. And in the rare cases that they do, they probably would have found your actual rate too expensive, as well.

But if a client is able to haggle down to a number that you were hoping for anyway, they’ll walk away feeling good about their perceived savings, and you’ll still be paid within your target salary range.

Put Yourself in Your Client’s Shoes

How to negotiate a salary with your manager

It’s common for freelancers to price according to what they think their services are worth. They should, however, be doing the exact opposite. When it comes to negotiating rates, it’s not really the freelancer’s opinion that will get the contract signed — it’s what the client thinks.

Try to approach your pricing from the client’s perspective. What value does your work hold for the client? What benefits will come out of the final project? This mindset allows you to propose solutions that work well for both parties, and arrive at the rate a client will likely accept.

For instance, in the client’s eyes, a design for an Instagram post will likely have a smaller perceived value than one for a billboard and ad campaign. But if you can present a project as having greater value, benefits, and overall worth, then the client will probably be willing to pay more for it. Consider all these factors and price accordingly.

And if there are any questions, don’t start immediately listing your personal expenses or experience. Rather, keep the conversation focused on the client, and connect the project’s fee with the benefits it will bring to their business.

Start Talking

Negotiating with a potential client can be scary. But not negotiating can even be scarier, as it could mean a quick close to your freelance career. Luckily, negotiation strategies and skills can be learned and, in time, won’t always be awkward. With enough research, and practice, plus the salary negotiation tips in this article, you’ll be able to ask for the salary you want — and not a dollar less.

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