3 Ways to Raise Your Rates and Crush Your Freelancing Fears
Credit: SimpleFoto on Photodune
Are you getting paid what you’re worth as a freelancer?
You might think so, but it’s more likely that you — like many freelancers — are charging much less than what your clients are willing to pay. This is especially true if you do excellent work (and I’m guessing that you do).
The primary reason freelancers are undercharging is simple — we’re scared to do it. We worry that the work that we are doing isn’t good enough or that we aren’t experienced enough to charge more. We worry that if we raise our rates, then all of our clients will run away.
Fear is normal … but it should be ignored
It’s natural to have these fears and worries as a freelancer. After all, getting the next paying client is what keeps us in business. However, while having fear is fine, letting it hold you and your business back is not. To help you overcome freelancing fear and self-doubt — and grow your business — here are three strategies for overcoming fear and raising your rates.
1. The time is now
A classic freelance mistake is to wait until the right time or the right client to raise your rates. The problem, of course, is that it’s never the right time. If you’re looking for excuses, then you’ll always find them. And if you continue to wait, then you’re leaving money on the table. It takes guts, but one day you’re going to need to make the jump. The sooner that day comes the better off you will be.
If you need inspiration, then talk to other freelancers who have raised their rates and see what they say. If they’re anything like the people I talk to, they’ll tell you that they wish they would have bumped up their prices a long time ago.
2. Plan fear out of your business
If jumping into the deep end right away seems too bold for you, then you can always schedule your rate increases just like you schedule paying your bills or your editorial calendar.
In fact, it’s often easy to eliminate the fear of raising your rates by planning to increase your prices over time. For example, you could schedule a rate increase after the next 10 clients. So when client number 11 rolls in the door, you already know that you’ll be charging $20 more. Or set a date when you will raise your rates.
If you make rate raising a scheduled business decision, then it’s easier to take the fear and emotion out of it. And that’s how it should be. Raising rates is just part of business. As you get more talented, more skilled, and more experienced, you should charge like it.
3. Try price tiers
A simple option for easing your way into higher rates is using price tiers. Price tiers are simply different pricing options that your clients can choose from — and you might be surprised how often they choose the higher options.
For example, instead of offering your services for $40 per hour, you could offer a basic service for $40 and a premium service for $60. Once you have a few clients pay for the premium service, you might feel comfortable enough to scrap the basic offering and raise your regular rate to $60 per hour. And you can go upward from there.
A final word of advice
Don’t make rate raising a personal or emotional decision. It’s a business decision. I’ll leave you with a quote from my friend and fellow freelancer, James Chartrand:
I’ve raised my rates at least 40 times, if not more. Raising rates is a natural part of business, and I don’t have any feelings‚ about it, really. Having emotional attachment to rate setting is detrimental.
In business, you set rates based on the value you provide to clients and the results you bring to them, that’s all. And when you provide more value or more results, you raise your rates and charge accordingly.
For more rate raising tips, check out this interview series with a wide range of successful freelancers.
Photo credit: Some rights reserved by SimpleFoto.
3,200 freelancers surveyed globally. In-depth interviews with 10 notable freelancers.
Insights and information you can't afford to ignore!
Find Out More
With over 100 weekly comic strips and counting, Freelance Freedom is an institution around here. Check out of all NC's brilliant work in the archives.
Freelance Freedom Archives
Good post, I think freelancers shouldn’t be afraid to raise their price, the worst the client will do is say no and probably try to negotiate a better deal for them.
Usually if the client doesn’t budge is say yes to the first rate you name then you probably charging too low.
I’m owner of Solo a project management and time tracking tool for freelancers. I’ve freelanced for over 15 years and had to raise my rates numerous times. It was always a tricky decision but it gets easier with experience. Having confidence in the value of your work is key. If your service is good enough clients won’t mind paying more.
One of the reasons I created Solo was to address problems like this. I think as a freelancer especially if you work to a fixed fee, it is important to know how much time you’re spending versus how much you are earning. If you’re constantly racking up more hours on a project than you are getting paid for, its probably time to assess your pricing structure.
Good post! Thanks for the tips!
Wow–this is exactly what I, along with the myriads of freelancers out there, needed to hear. Thanks for posting!
Nice reminder. Gotta raise mine some more
Great article.
Yes, I do agree that as you gain more experience you need to charge more this is how it goes and there’s nothing to loose except low paying customers
.
I’m with loan.
Increasing your rates is indeed a good way to get rid of low paying customers. And it’s a fabulous way of telling your “problem children” to go elsewhere.
It’s worked for me, and it can work for you.
Timely article!
specially the state of the dollar exchange rate, freelancers outside the US should really consider this.
I agree completely with James Chartrand. There shouldn’t be an emotional factor in deciding on a rate. If you want to be a leader in you’re industry you have to always be learning and growing. With the added knowledge and experience it’s natural for your rate to continue to raise as you’re providing more value to the client.
I don’t do much freelance work these days but the beauty is I can pick and choose and because it’s more specialist front end stuff I can charge quite high rates – I do this because I want to commit myself to the project and not churn out something I wouldn’t like.
Much appreciated encouragement, thank you.
I am just starting off and am yet to have a paying client so have been tempted to charge nothing just to get referrals but of course I don’t want to devalue my service.
I agree completely. I found out about a year ago that I was charging half of what I should be charging. I raised my rates quite a bit, and actually got MORE clients. It can be scary at first, especially when it’s your only income, but it’s beneficial in the long run.
Work smarter, not harder.
Good advice. Glad this is an issue that doesn’t just plague me!
When I was building my web design portfolio I was an unknown, and I would take jobs for very little pay, just so that I would have a portfolio to present to prospective clients.
Now that I have a portfolio, I can charge more money and be a little more selective about which jobs I will accept.
Excellent information, the best perhaps is “The Final Word of Advice” and “Don’t make rate raising a personal or emotional decision.”
Personally I’ve made some of the best friends from many of my clients, they come and tell me all the joys and difficulties they experience in their business, on a regular basis, so there is a close attachment to all of them. So for some time raising rates was a difficult task.
But articles and reinforcement from other colleagues, makes the issue less of a problem nowadays. Thanks for sharing.