Ep 13: How to calculate your hourly rate -- Freelance Foundations

Topic: What to consider when you're identifying that magic number

There's a science to calculating how much you need to earn from your freelance practice to thrive in your first year and beyond. In this episode, Allison and Trevor discuss the basic numbers, hidden expenses and costs to take into consideration along with an honest assessment of your skills to arrive at an hourly rate that does justice to you, your clients and your bank account.
File Size: 
23 MB
Duration: 
0:47
CLEAN
Show Notes: 

Infographic: How to calculate your freelance hourly rate - Creative Live Blog

Quotes: 

5:35: “You want to break (your calculations) down into a number that says, this is how many billable hours per year I end up with, and from that you take your adjusted annual salary that takes into account all of this stuff - costs, expenses and income - and divide it by billable hours per year so you come up w/ whatever your number is.” - Allison

6:16: “Setting your hourly rate shouldn’t be a guessing game. It should really be a numbers, fact-based evaluation of both your skills and talents at the time and the market.” - Allison

15:48 “Ten per cent (of your income) - save it for CPP (Canada Pension Plan) and make sure you don’t get caught at the end.” - Trevor

19:46: “Your goal is to not be a commodity. The only way you can avoid becoming a commodity is to show that your value is distinct….I think that there are times in the right circumstances and it strategically makes sense for the freelancer, that rate negotiation is possible. There should be something of significant comparable value added to the conversation…” - Trevor 

28:50 “The most important thing we captured in talking about how to calculate your rate is all of these hidden costs…(including) office expenses, equipment costs…these are all areas where you shouldn’t scrimp. You should spend as much as you can possibly afford because the equipment will last longer and you’re using it for so much of your work day.” - Trevor

32:19: “Never scrimp on those costs, because if you’re investing in your equipment, if you’re investing in your ongoing education and professional development, you’re working on your own, nobody else is going to do that for you. And if you don’t, your skills are going to atrophy over time. Doing that consistently and regularly is what’s going to enable you to stay performing at a level that justifies your value, because you’re always adding something new into the mix, you’re always doing something better. You’re always doing more. You’re finding new approaches to solving problems.” - Trevor