Raise Your Rates

Like any job, there comes a time when you outgrow the pay rate that you’re getting from a client. After all, you don’t want to be earning the same amount of money for the rest of your life. There are two ways to get paid more. Take on new clients at a higher rate or negotiate a pay increase with your present clients.

I believe that negotiations with current clients should come at the end of the year or at the beginning of a new year. However, the actual date you choose to ask for a raise is up to you. Here are the circumstances that signal it’s time to ask for a raise soon:

Your Responsibilities Have Increased

While working with a client, you may be asked to do an additional task here and there. You may also discover that you’re one of the most experienced on the team at doing what you do. List out the responsibilities that you have now and jot down reasons you’re an important member of the team.

Think about a percentage that you’d feel comfortable taking in addition to what you already make. Ask your client if you can have a discussion about your pay rate and set an appointment date. Bring your reasons for why you deserve a raise and be prepared for negotiations about your rate. Learn more about negotiation tactics here.

Your Hourly Rate is in the Toilet

The general consensus among freelancers is that you should stay away from hourly rates. You should charge a per project fee that takes into account the overall value of what you deliver and not just the time you spend. Sometimes when setting a per project rate you underestimate how much time it’s taking you to do the work.

Say you’re charging $2,500 for a project. It sounds like great money. But what if it takes you 100 hours to do the work over several months? You’re making $25 per hour before taxes and business expenses. If you’re hourly rate is low compared to the work you do for a client, it’s probably time to ask for more money.

You Don’t Feel Good About What You’re Making

I’ve learned to never discount the feeling I get when working for a client. Sometimes you feel in your gut that something is not right. You can usually tell if you’re not making enough money for the work you’re putting in. The feeling you get when you receive the money isn’t one of gratitude.

You may feel resentful or even dislike the work you’re doing because you don’t feel compensated appropriately for it. This is a situation that needs to be fixed quickly. It’s time to negotiate a raise or move on to another client. Bad clients or clients that underpay will impact your entire business and mindset. When you let bad clients go, good clients seem to always find a way to take their place.

Final Word

Freelancers and business owners get raises. You’re not stuck at the rate you have for your entire career. Come up with a game plan for increasing your rates this year if you haven’t increased them in a while.

Taylor K. Gordon is a personal finance writer and founder of Tay Talks Money, a personal finance and productivity blog on hacking your way to a happier savings account. Taylor has contributed to MagnifyMoney, The Huffington Post, GoGirl Finance, Madame Noire, and The Write Life.

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