Rate Hikes: Negotiation Tips for FreelancersBy Jackie Lam July 26th, 2023
When I started freelancing about a decade ago, I took whatever gig was tossed my way. I was consumed by fears that I wouldn’t have enough work to cover my bills, which clouded my better judgment. In turn, I was in “hamster running on a wheel” mode. I took on more assignments than I could reasonably handle. While the money stacked up in my bank account, my mental health—and quality of life—spiraled.
Taking on chronically underpaid work meant 16-hour workdays. Those bouts of stress, anxiety, and exhaustion led to mental burnout. And I still wasn’t living up to my earning potential.
If this resonates with you, maybe it’s time for a rate hike. Not asking for what your work is worth is a common hurdle among freelancers. We talked to seasoned experts to come up with seven negotiation tips to get what you deserve.
1. Know your numbers.
We’ve all been there. We charge less than we think we deserve because we’re not feeling all that confident. “A lot of the time, freelancers have what I will call ‘unstrategic prices’ because they never reverse-engineered their prices from immediate needs and long-term goals,” says Austin L. Church, a freelance mentor and creator of Freelance Cake.
Instead, Church recommends coming up with strategic rates, which are rooted in your experience level and the current market rates for the type of work and industry you cover. The rate you come up with should serve your immediate financial needs and move you toward your long-term goals.
Besides knowing how much you need to thrive financially, keep three numbers handy to help you negotiate, suggests Lynn Price, a consultant, attorney, and author of Negotiate It! How to Crush Your Fears, Develop Your Negotiation Muscle, and Gain Power in the Workplace. These three numbers are: the lowest rate you’ll accept, the medium rate, and the high rate (for when you’re feeling extra confident or perhaps ambivalent about the assignment). Having these three numbers in your head will help you be more comfortable and prepared when negotiating with a client.
And as Price reminds us: Our feelings aren’t facts.
“When you go through your due diligence when you’re pricing, it’s like, hey, I have this much experience, I have these client lists, I have this amount, I’ve been paid this in the past. You can become more comfortable when you see the facts lined out,” says Price. “That way, you can confidently remind yourself that this is the appropriate amount for your services, and you’re not going to feel bad about it. It’s what you deserve to be paid.”
2. Have your rates script ready.
If you’ve done your research and prepared a script on how to discuss your rates, you’ll be in a better position to negotiate for what you want. “If you’ve rehearsed what you’re going to say to a potential client, and the conversation comes around to money, you won’t be taken off guard,” says Church. “Your price is your price. You don’t go into a restaurant, look at the prices on the menu and say to the waiter that these prices are too high. They’ll just tell you to go to a different restaurant.”
Rates for different types of work vary depending on the scope and industry, which can make coming up with rates a tricky matter. “I think so many freelancers undercharge just because there’s not a ton of information about what to charge and how to charge,” says Brooklin Nash, co-founder of the agency Beam Content and creator of the Dear Freelancer newsletter.
You can start by looking at existing freelance rates databases, such as the ones compiled by the Editorial Freelancers Association, Contently, and Freelance Solitary. Another place to start? Look at what other freelancers with similar experience and backgrounds are charging on creative freelancing platforms.
Or maybe you accept a lower rate because you don’t know how to say no. If you’re having trouble getting the rate you’ve requested, it might be time to say something along the lines of: I understand you’re looking for a lower rate, and I appreciate your interest and the opportunity. However, at this price point, I won’t have the capacity to give this project the attention it deserves.
3. Face money avoidance blocks head-on.
Another common culprit that freelancers have is being avoidant about talking about money in general. According to clinical psychologist and financial planner Brad Klontz, there are four main money scripts, and one of these is money avoidance.
When we’re money avoidant, we avoid dealing with our money at all costs because it creates too much stress or ill feelings. Money avoidance might stem from past negative experiences talking about money or a belief that asking for money might make you come off as self-interested, greedy, or not genuinely interested in the client or the work itself.
As Church explains, when it comes to negotiating rates, freelancers who are caught up in that money avoidance pattern strongly dislike conversations about money. In such conversations, the party who can stay in discomfort the longest usually wins.
“If you’re uncomfortable talking about money, well, chances are if you say, ‘Here’s my price,’ and then the client says, ‘We don’t really have that kind of budget, would you take X?’ And they offer a lower number. If your insides are writhing at this point, you’re really uncomfortable. So you say ‘yes.'”
To overcome any mental blocks around money, consider journaling to get to the bottom of your behaviors, patterns, and beliefs around money. Church also suggests seeking mentors. These aren’t necessarily people who you idolize. Rather, they’re peers who share the same values, work ethic that you can relate to and admire. However, they’re getting much better results than they are.
“You don’t look at their skills and be like, that person is literally ten times better than I am,” says Church. “Usually, the only difference is they have different beliefs about money. How are their beliefs different, and what can I do to change my own limiting beliefs about money.”
4. Ping your network for insight on what to charge.
This might seem awkward, especially since your network can also be the competition. But in my experience, I’ve found that most of the time, fellow writers who I’ve gotten to know and have developed a connection with, are quite open to talking about rates and offering negotiation tips. Often, freelancers feel in the dark when it comes to money talks and are willing to help a fellow freelancer out. Plus, they know you’ll be good to return the favor down the road. Here’s an example of what I’ve done that has worked:
Hey X! I’ve been a regular contributor to the X [insert name of publication] for about a year and a half now. I noticed you’ve done some writing for the [insert name of publication].
I just renegotiated rates with my contact there and wasn’t sure if I charged enough. At the risk of sounding blunt, might I ask what rate you charged? If you don’t feel comfortable giving a specific number, was it under or over $700 for about 1,000 words? Did the rate include sharing on your social media platforms?
It opened the conversation to not only their experiences working with a client but also what they included in the scope, such as sharing out articles on social media, writing social media copy, or any SEO research.
5. Know how to give yourself a raise.
People in traditional jobs often get annual raises. When we’re self-employed, it’s our job to give ourselves a raise. Many of us freelancers fail to ask for a rate increase annually—even from anchor clients we have a longstanding relationship with. Inflation has impacted all of us, so if anything, that’s a reason that will resonate with clients.
Also, consider whether the client has been expecting more from you or if you’ve learned a new skill or recently received an accreditation that boosts your value. “Let your clients know the why behind your ask,” says Price. “It’s helpful for people to understand why exactly your rates are going up.”
6. Push back on scope creep.
Scope creep inherently reduces your project rate; you’re doing more for the same amount of money. To avoid scope creep from happening in the first place, clearly lay out what is expected of both you and the client with a project or work arrangement. Express in writing what it is you’re willing to do and not do. Ask plenty of questions at the start of an assignment. For instance, what are the anticipated milestones and deadlines? What are the sourcing requirements? How many revisions—if any—are included in the assignment?
When the scope of an assignment or project gets out of hand, it’s important to push back by asking if they want to scale back on the deliverables or pay more money. “Let your clients know this upfront, and have that be part of your contract,” says Price. “If they request extra services, it’ll be at this amount.”
7. Have an emergency fund.
We’re more prone to agree to lower rates when we don’t have an emergency fund, points out Church. Ideally, you should have an emergency fund for your freelance business that’s separate from your personal emergency fund.
This might feel like a tall order, especially when you’re working with inconsistent income. But commit to tucking away a small percentage of whatever money comes in. There are a handful of apps and banking platforms that help you automate your savings.
Simple tactics for stronger negotiation skills
The good news is that negotiation skills can be developed. Just like building muscle, over time, you can learn to navigate money talks with your clients with finesse, comfort, and confidence. Practicing these negotiation tips can help you improve, ease any qualms you have about your rates, and boost your earning potential as a freelancer.Image by beast01; Chat Bubble image: Mongkol Akarasirithada