Hiring freelancers is one of the ways I’m able to stay productive in my business. I recognize that I’m not an expert on all things. I have a designer designing a book I’m publishing, an editor editing the contents of my book, and a virtual assistant who handles social media and other business tasks.

As a freelancer myself, I’m very sensitive when having money talks with contractors. I know what it’s like to be on the other side of negotiations when prospects try to get you to reduce your rate. It can put you in an awkward position, and it can even be insulting if the price they offer is far lower than what you ask.

I’ve noticed an interesting conundrum in the online world. Freelancers want to get paid appropriately, and we work tirelessly to increase our income. But when it comes to hiring out to other freelancers, some look for very cheap labor.

My stance is that I want to pay people a rate that’s on par with the quality I expect. I pass on interns or asking people to do jobs for “experience” because I believe people should be paid appropriately for their work. Here’s why paying well can benefit your business and the freelance community as a whole:

Cheap Labor Drives Down Prices

Expecting cheap labor can impact pricing for all freelancers. We set the precedence for what people pay us. Say you get a great deal on $10 per hour from Sally. When other clients come courting you, they’ll wonder why you’re not charging $10 an hour like Sally. It’s a cycle.

Pay Reflects Energy

There’s energy in transactions. The way the relationship starts carries through the rest of the working relationship. If there’s penny-pinching at the beginning and the freelancer gives in, the relationship doesn’t start off as positive. The freelancer can feel undervalued. I’ve been in this position.

People generally turn in the best work when they feel valued and appreciated. I want to invest in good work. Quality workers give you a quality product. They’re typically quick learners. They charge more for their service because of their expertise. They can offer ideas, help you set up systems, and they work autonomously.

Being Cheap is a Limiting Belief

If you’re being cheap when hiring contractors (I’m talking just a few bucks per hour), you may be operating under a limiting belief. The money you invest will not leave you forever. The idea is that a freelancer is doing a task that will help you earn more money or improve your quality of life. They may free you up to pursue other business activities or help you create a stunning website that attracts new customers.

I’m spending a decent amount of money on a book that I’m self-publishing. Sure, I could go the cheap route and make the cover myself or hire someone to do it for a few bucks. But I believe that customers will appreciate and see the value in a professional product so I hire professional people who are doing great work.

Final Word

Some freelancers I hire cost a bit more than others, but my policy is to never ask for less. Someone’s rate is someone’s rate. I rarely, if ever, negotiate the rate I charge clients. I also take this into consideration whenever I’m in the shoes of a client hiring another freelancer.

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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