When Should I Ask for a Raise as a Freelancer?
Most W-2 employees can only dream of setting their own pay, but as a freelancer, you can make it happen. It’s an amazing opportunity, but also a lot of responsibility because you are the only one who can give yourself a raise.
Can freelancers ask for a raise?
Freelancers can—and absolutely should—ask for a raise. Depending on how you get paid, the most direct way to increase your income is by raising your hourly rate, monthly retainer, or project rate.
When should I ask for a raise as a freelancer?
Here is when you should raise your rates:
Your contract is up for renewal: If you have a contract (and you should have a contract), you’ll need to honor the agreed-upon cost and scope, but the end of a contract is a natural opening to raise your rates if the client has indicated that they want to continue working with you.
The client asks for more work than was in your original scope: If a client asks for additional work that is outside of your scope, you should absolutely ask for more money for that extra work. If the client doesn’t want to pay more, then stick to the original scope.
It’s been a year since you started working with a client or last raised your rates: Many W-2 jobs include an annual review and compensation conversation. Even though you’ve left the confines of the corporate hierarchy, an annual cadence will be familiar to your clients and they are unlikely to be surprised by an increase in your rates at that time.
Your costs have increased: Your operating costs directly affect how much of your revenue ends up in your pocket. If the costs of operating as a freelancer increase due to a new product you need, a subscription hike, or higher health insurance premiums, it’s entirely understandable to increase your rates to at least maintain your current standard of living.
You want to nudge a client to move on: If a client has become too much of a pain to make the work worthwhile at their current rate, you can always drop them. Or you can name a rate that will make the work worth it to you. That way, you set yourself up for a win-win situation.
How much should I raise my rates as a freelancer?
When you’re starting out as a freelancer, you are often taking a shot in the dark on your pricing. But as you gain more experience, expand your network, and take on new clients, you get a better sense of how much you can charge.
Once you’ve established a solid base of clientele, you can continually test your rates by quoting higher prices to new clients. This will likely leave you with some long-standing clients who are paying well below your new rates. You can either increase your rates gradually to get them up to par or if you have enough higher-paying clients business coming in, you may need to quote them your new prices and be prepared to let them go.
How else can I make more money as a freelancer?
There are also a few creative ways to increase the value you receive for your work without directly raising your rates:
Offer a reduced scope: If you want to work for a client who can’t pay your desired rates, offer them a reduced scope of work for a price that fits in their budget but is still worthwhile for you. A reduced scope will mean you have more time to devote to other clients.
Change your pay structure: If you don’t feel like you are getting enough value from working for your clients, a different way of structuring your compensation might work better for you. For example, if you charge hourly but have a client who has urgent requests or erratic hours, a monthly retainer could be beneficial.
Charge for additional costs: If the work you do for a client requires extra expenses such as services, products, or travel, charge for those in addition to your regular rate.
Need help managing your money as a freelancer?
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