Please note: These are some ideas but how you set your rate is entirely up to you.
What are your skills, experience, and time worth? How much are clients willing to pay? These are possibly the toughest questions for new freelancers to answer, but they shouldn’t hold you back from setting your initial rate—a starting point that can easily be adjusted as you gain experience.
While there is no one formula to figure out the perfect hourly rate, there are universal factors to consider that can help you get close to the mark. There are also reliable signs that will indicate when it’s time to consider raising your rate.
Setting your first rate
For new freelancers, it’s important to look at both what you will offer clients as well as the competitive landscape for the type of jobs you would like to secure.
Your long-term goal is to find a rate that is representative of the quality of your work, and competitive enough to help you secure as much work. Finding that balance takes some of your own trial and error, here are some tips shared among our successful freelance community:
- Take time to do your research. How do other freelancers price themselves? One valuable resource is the Upwork platform itself. Research the types of jobs you would like to secure and how other freelancers with similar skills and experience bid on these projects. Also check out their profiles: look at their work history, feedback, and whether they are “Top Rated.” Look at how new and established freelancers set their rates so you have a range of rates to consider.
- Factor in your stats. In addition to skills, work experience, and education, consider your personal “stats.” For example, are you an expert in the type of work you want to do or starting a new career? How efficient are you? How many hours do you want to work? How much money do you want/need to make? Do you have unique skills, experience, and/or relationships to offer to clients?
- Plan to increase over time. On Upwork, your first few jobs are invaluable in helping you build a solid foundation of client ratings and reviews. Some freelancers, eager to build their profile, will bid slightly lower on their first few jobs as a strategy. Seasoned marketing writer Tim H. started off his freelance career knowing his rate would grow over time; since he started, he’s increased his posted rate 1,500 percent! He still adjusts his job bids to suit the type of job, and the needs of the client so he always has a steady stream of work.
When is the right time to raise your rate?
Once you have solid experience on Upwork, there are telltale signs that you should think about raising your rate.
- Job invitations. Have you started receiving invitations to apply for specific jobs? This is a great sign that your hard work is paying off. If clients are asking you to bid on their projects, they may also be singling you out to apply. Consider this an opportunity to set your bid a little higher since you know the client already values your work and experience.
- Too much work. What a great problem to have, right? If you are securing most of the jobs you apply for and have more than enough work, this is a great time to start slowly increasing your rate on your profile and in job bids.
- Ready to specialize. It’s likely you will find a work niche that you enjoy and are successful at. If you want to position yourself in this niche, research other freelancers in the same space and see whether there’s room to raise your rate.
- Long-term clients. The longer you work for a client, the more valuable you often become to them. Maybe your role has expended since your initial project. Look for milestones in your working relationship, like a six-month or one-year anniversary, as an opportunity to check in and discuss a rate increase.
- Leading teams. With significant experience in your field, you may be able to help clients manage other freelancers as a team leader. Consider increasing your rate for jobs that carry more responsibility and insight into your clients’ business.
Remember: slow and steady wins the race! Raise your rate in increments as you complete projects, then see whether it impacts your ability to secure work. And consider these words from fellow long-term freelancer Nikhil Mandrekar from Dubai: “Don’t undervalue yourself.”
For more advice on setting your rates and thriving as a freelancer, check out “How to Price Your Freelance Skills Like a Pro.”