The difference between having a successful career as a content writer, and failing miserably, can often be down to something as simple as charging the wrong rate for your services. If you are struggling to work out the right rate to charge clients, I am going to try and help out, and explain how I arrived at my rate in this blog post.
Back in 2006, when I first got into content writing as a full-time job, I made a pretty big mistake. For the first couple of months I went into overdrive, writing upwards of 10,000 words a day. The rate I charged was too low, and within six months I was burned out. You simply cannot write 10k words a day, every day, continuously. This was when I realized I had to take a step back, and approach things differently.
How I Calculated My Rate
I sat down and worked out how much money I needed to earn each month. I then turned this value into a daily rate. However, I was also careful to make sure I removed 10 days a month from the calculation, as everyone needs time off. So I was left with 20 productive days a month, and then divided the monthly income I needed by 20, to come up with my daily rate.
Once I had this daily rate, I reduced it down to an hourly rate. I decided upon how many hours I wanted to work a day, and then deducted 25% of this time for admin tasks. It is surprising how long it takes each day to deal with clients, produce proposals, manage finances, and all of the other things we need to do to maintain our businesses. So I took my daily rate, and divided it by the number of hours I wanted to work, minus 25%, which I allotted to admin tasks. This gave me an hourly rate. Now all I needed to do was work out a word rate based on this figure.
I am comfortable writing around 500 words an hour, this includes research and proofreading. This is not a constant however, some projects take longer, others are quicker, but it seems to be my average. So I took my hourly rate, and divided it by 500. This gave me my word rate. This was the simplest calculation of all actually. So now I will try and show what I did as some sort of sensible equation:
Daily rate = monthly cash requirement / actual working days (weekends and vacation time subtracted).
Hourly rate = daily rate / actual productive hours (25% of time deducted for admin tasks).
Word rate = hourly rate / number of words produced per hour.
Sitting down and working this out gave me two prices, my hourly rate, and my word rate, I was now equipped to make intelligent bids upon both hourly and fixed price projects.
Your Rate Should Be Set in Stone
I should have been fine once I had calculated my required rate, but it seems I was not quite done with making mistakes. I started shifting my pricing to win projects I particularly wanted to work on. This was a very stupid thing to do. My rates had been calculated on my cost of living, so what was the effect of lowering my price on certain projects? I ended up making less than I needed to live. Big mistake. The lesson I learned from this was that I needed to set my rates in stone, and not shift them for anything.
I had to begin being harsh, discarding clients who could not meet the rate I needed. I also had to start ignoring projects that were interesting, but not paying a high enough rate. This was quite tough to do at first, as it is always tempting to try and fill your schedule up with cut price projects, if your calendar is looking a little empty. I stuck to my guns, and blindly refused to work on anything that paid less than the rates I had arrived at in my calculations.
I my opinion, this is the only way to arrive at a sustainable full-time income as a content writer. Your rate needs to be calculated based on your actual monthly cash requirement, including extra money for luxuries, savings etc. This rate must then be adhered too, don’t drop it for anything. Of course, you need to constantly revise your rate to make sure that it still covers your cost of living, but once you have done the initial calculation, this becomes pretty easy.
A Note on Complicated Projects
There is one thing I would like to add though, now that I have explained how I arrived at my rate. Over time, I have learned (quite painfully at times) that certain types of projects are simply far more complicated and time consuming than others. For example, writing an academic paper with citations takes far longer than some simple blog posts. So I consider my rate to be the minimum rate I charge clients. I will often raise it to accommodate complicated project requirements, but I never lower it.