How to Calculate your Hourly Rate for Freelancing (animated)
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- เผยแพร่เมื่อ 5 ส.ค. 2024
- There is more that goes into figuring out a fair hourly rate then just adding up a couple numbers. As a freelancer there are other expenses you have to include. In this animation we go thought the steps I used to calculate my hourly rate.
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I really wish they covered this stuff in art school! How much to charge as a freelancer, how to get clients, how to build a portfolio, how to send an invoice, and how to count your hourly rate in squirrels. People need to know these things.
Lilly Aguilar How about how to write or review a contract!!! Favorable terms, work for hire vs licensing, nailing down a focused and measurable scope of work... 😫😫😫😫😫😫😫😫
If they did, no one would go to art school... they'd choose a different vocation.
If it makes you feel any better, they don't even cover this stuff in law school.
I love your profile pic Lily's are one of my favorite flowers 🌸😊
I dont think any school teaches you the earning money part. Just doing the work.
I’m still waiting for the squirrel to get his tail back. 😭😭😭😭
OH NO! I FORGOT HIS TAIL!
next, on the Brad Colbow show A Tell of the Tale and Squirrels who miss them
Squirrels is now my favourite currency.
My addendum to beginners: don't work below minimum wage. Don't be doing freelance less then amount you'd be making working at Mcdonald's, etc. Time how long it takes you to complete the work you want to be commissioned as well.
Also, I work for an independent dog groomer during the weekdays. Over the year I've been with her I've picked up a lot of tidbits on self-employment and I study how she does her business and handles her client base-- I think a lot of it could be applied to freelance design/art as well.
I would like to add that if you need to take a job with a certain client you don't like or a project that you really don't want , then by all means charge more. If you are going to lose a piece of your sanity at least make it kinda worth it.
Agreed. It is your business, and so your reasoning for your rates should be based in your reality - how much labor the task requires taking into account every factor, including if the work is an uphill battle for you personally
That is brilliantly explained. Recently quoted and won a contract where i broke it down for them for what they got. As an illustrator it seemed massive. But breaking it down they saw I was just above minimum wage and were more than happy. I got a shock 12 months back when I realised just how much I had to charge. Of course with wretched fiverrrrrrrrrr it’s hard to resist the race to the bottom, but if you can AND work out your value added.... so I don’t just illustrate, I help people write edit publish and even advertise their stories. Again, great post. Hope you don’t mind but I will not bother remaking a similar video, just link to you.
After having a few clients who would waste a lot of time with unneeded meetings, I started charging an hourly rate for them including travel time after the fist.
it's a small amount, hardly anything. But it helps discourage things like being asked to meet in a bar at a hotel in a February blizzard where your client is staying, only to find out they want to smoke cigars and drink scotch on the bosses amex card, and I don't drink or smoke.
Also they wanted to make sure I knew the bull I was drawing didn't have utters....yeah.
Interesting stuff. I have been freelancing for 5 years ( game artist ) and haven’t put my rates up since I started, and I really think I need to.
I hesitate for fear of turning off clients and feeling like I am being a bit greedy ( maybe that’s just British-ness... )
But I’ll work something out based on this and see what I come up with 🤔
Thanks for posting it up !
Good for you! Also, don't be afraid to raise your rates even for existing/ongoing clients. It may feel a bit sensitive, but if they love working with you, then they will support your living.
It can also help to say the # you're raising your rates to, but then give them a discounted rate as a loyal client (which is still higher than your original rate). That will show that you are continuing to price yourself appropriately throughout your career, but that you acknowledge their role in helping you reach the point in your career that you have. And of course, to show flexibility if they feel that your raised rate puts you out of their budget (which generally it shouldn't anyway, especially if they are a larger entity).
Wow, that's a youtube video where the comments are actually respectful, insightuful and complement the video
Right?!? I've actually enjoyed comments for the first time in forever! :)
Wow, that is the clearest answer to that question that I have ever heard. Thank you!
Hourly rate? As a studying illustrator, we are taught to only charge FEES because it doesn’t make sense to charge an hourly rate because it’s unreliable. All illustrators have different styles and work at different paces so for example, anyone with a very “simplistic” illustration style would not be making nearly as much as those who create more complicated or detailed illustrations for the same job. Also, it would be very easy for anyone to say they spent a total of 30 hours on an illustration job when they actually spent 20 hours on it.
How you decide to charge your clients is up to you. Some guys give hourly rates, others fees for specific work and a set number of revisions etc. It's down to personal preference, and what makes the most sense for your work. No matter which way you go, however, you still need to figure out an hourly rate that allows you to make a living. If you charge hourly, then you give that rate to the client. If you charge fees, then that's how you determine those fees (hourly rate x estimated hours to complete the project). One of the worst things a freelancer can do is under price themselves, and that's an easy thing to do if you haven't figured out what your hourly rate should be (even if it's only going to be used behind the scenes).
So, end of the day, it's something you're going to want to figure out regardless of how you decide to bill your clients. It's also something that you should revisit regularly as you progress in your career and skill level. Always make sure you are getting paid what you are worth.
Yeah, I find the hourly rate unreliable too! I prefer daily rates, which are calculated in the same way, and it doesn't matter how many hours I work on that day (with a maximum of 8/9h) the important thing is to deliver what was asked.
That's actually really good advice, illustration charging is a lot different than design charging which is most of what I do.
@@albafrancescut You can always lie and add up to days, even...
i charge per illustration and have different prices for them. I calculate for myself how many hours an illustration type takes and based on that is price. Like this the client cant be fooled by me saying random hour numbers, yet I am secured of underpricing.
This video is gold! Everyone thinks they are going to be an artist but they have no idea how difficult it is compared to being on someone's payroll.
I like your theory Brad! Thanks for a great vid. Your videos have inspired me to work on my art skills and I have recently bought an Apple Pencil.
This was INCREDIBLY helpful. Several points I had not thought of. Way to take a *yawn* and make it interesting. Thanks!!!
This is a highly underrated video xD
SO. DARN. GOOD!
This is so good, thank you for that Brad!
Very quick and punchy - I liked it!
This is actually a super helpful video! You broke it down nice and easily for us to understand. Gave me allot to shrink about, appreciate it.
You are a lifesaver! thank you! your video is amazing!!!!
Just shared this video with an illustrator unsure what to charge for small chapter ink and watercolor illustrations. Very helpful!
Good info. A big sliding scale to work with depending on what type of work you do and how you value yourself for your provided work.
Great informative video with cool animations. Thanks.
Very concise! Well done.
You made my day Brad, your video is very creative and hilarious. Totally love the humor!
Glad you enjoyed it!
Very helpful as always, Brad!
The breakdown works better in person then online especially in a freelancing site where the competition is high. From my experience most client want Top class stuff for little $$....even if it means to go the cheap route. But if I lower my rate a bit for the first job and they like it they will pay even higher for the next few projects and become regulars. Because they know what they're getting so they don't clinch on to the wallets as hard.
Leo E in my experience if you lower your rate, they expect that to be your rate from then on.
I agree that can happen from time to time as well. If you did a good job the first time and then tell them your new price. They will still take it as long as the difference is within a few dollars. Chance are they wont get any better than you for that price. So I always play hard ball after the first project and they almost always take the bait.
THANK YOU. The art world really needs more direct info when it comes to actually making money. Thanks for helping with that!
I’m going to try this! I’m in the U.K. so will work to uk tax rate ect but this seems a much more simpler way than some online methods I’ve read.
Extremely useful. Thanks, Brad!
This was so helpful thank you!
Excellent training session thanks you for making it.
Very informative. Awesome job. 😁
Very insightful! I love how you explain things. I recently bought two of your Udemy courses (Procreate and Affinity Designer). I can't wait to get started on those!
I told you this guy rocks!!! I am but a water down Brad... and I'm good with that.
Wow thats insanely good advice! Thanks for the video :0
Beautiful channel, just Brilliant!!!⭐
I wish clients were willing to pay 103.5 squirrels an hour instead of wanting free art for "exposure".
Wonderful break down of how you calculate your hourly rate. It would be nice to see how you make business with said “outrageous” hourly rate. I feel like if I tried this, I’d be scoffed at and they’d find someone cheaper.
Flinkbag there’s always going to be someone cheaper
Quentin Preik agreed 😩😂
Flinkbag, salesfolk call that feeling “head trash”. Services people of all kinds, and I suspect artsy types are especially vulnerable, regularly charge much too little for what they do. If you are good at it - you work hard, you practice, you make mistakes and learn from them - then you simply are more valuable than the average out there. And you can learn how to not suffer from the head trash - just more practice! Read Cal Newport, “So Good They Can’t Ignore You”. Also, remember that if someone gasps in disbelief at what they say is a high rate, they either haven’t thought it through, or in fact they have b cause they are trained negotiators and they’re doing it to you on purpose. Just nod, a bit sadly because they are about to lose the opportunity to get your awesome work, and say “I understand. So, should we just wrap up then?” Nothing like that confidence to have them wide-eyed and groveling at your feet pleading “No, no, pleeeese don’t leeeeve me!” 😉
Love Merica, here in Europe not even a doctor has that hourly rate, fortunately we don’t have to pay healthcare, man a 1k a month? DOH
Andrea R., well you do have to pay it, it’s just done out of taxes.
Very helpful and useful video
This is the kind of thing that they should cover in trade school. Thank you
This is informative AND entertaining ☺️ AND artistic/ creative ☺️
aaaaaaah am I the only one that really loves your animations
Best math lesson on TH-cam
Wow really helpful Thank You:)
I learned English by myself, and it sucks, you know... But the difference between "then" and "than" is clear, and I am amazed by the fact that so many english-talking people confuse these words... Man, sometimes I can infer when one means "than" by saying "then", but sometimes it's hard to figure it out...
Question: where do you usually buy your raccoons?
Arbys.
Very helpful and I am not a freelance designer but a regular old fine artist.....
Here in Africa, it's hard to charge on an hourly basis.But this is the method I use. I add my expenses+bills+emergency+savings then I divide it by the number of hours to work per week or month depending on the gig.
I send this episode link to my students, Nice job squirrels! (You too Brad 😉)
That was bloody funny 😁
I need this thanks!
I love the Windows/Mac logo
I love your animated stories. Please can you do a video on your process and the tools you use to produce them! I am particularly interested in how your line drawings become animated.
Yes, I have one in the works!
Brad should definitely get 5m subs for all the additional squirrels! 😁
Spot on Brad, you are spot on.
Definitely billing my customers in squirrels 🐿 from now on!
Great video
Thanks!
I might just send this video the next time I'm asked about my rates :)
i actually used a different technique to price my freelance jobs - "how much money would it take to get me off the sofa?" of course my speciality was kill fees, i could spot a doomed project , it was my super power
that's a good way to do it, what makes it worth your time is actually a great question to ask.
you'll always get folks asking for freebies or discounts or unpaid corrections ...i tell them time i spend doing this alone in a room, is time i could be with my loved ones. it really cuts through
Legends have that the squirrel never got his tail till this day😔💔
Dammit! I was about to sue you on some frivolous technicality, but you have a lawyer! On to some other schmuck!
The numbers seem very reasonable.
That's cool way
I'm not an artist and I love this channel ahahaha.
That might be the best compliment some can give me.
I have no real interest in daily freelancing,
but your videos are entertaining :p
the math disclaimer for designers lmao
How do you get people to pay that though?
Work hard, get a great portfolio, and start getting some self-confidence bud, its a process to put out what your worth, (this applies to the national currency - pay level you live in)
you gotta earn it, this isn't something you get right out of the box.
Whats great is when they pay, and their check bounces! LOVE THAT
It would be cheaper to employ a doctor than a graphic designer...
mwinner101 It sounds expensive, but normally you are being paid from a budget. I once got hired by a small company named Pamplin Entertainment. I priced low thinking this company would not cover a large budget. Parent company turned out to be Paramount Pictures. It also depends on your market. There are SO MANY variables. I think ol’ Brad here was just giving an example of squirrels and it really does not have anything to do with money. Not many doctors work for squirrels these days ;)
I'm so glad I don't have to get health insurance in my country
Can i trade squirrels for chickens?
Great vid. How about your level of proficiency? Maybe your super quick, or maybe your not so quick. Should that be factored in?
If I hired a locksmith that just started their career and took an hour to unlock my front door. I see them struggle, sweat and put their all in and thus I feel happy to pay in full.
Let us say 100 squirrels
Now if that locksmith has been doing it for some time, they can now do the same job in ten minutes easily. Should I feel cheated that they charge the same amount? I would say no, because you're then penalising a person for getting better at their job. A skill that they have built up over the years that has made them quicker.
So the amount the locksmith makes per hour has gone up from 100s to 600s
I'm sat here with a joint income of about £20,000 a year maybe less (my benefit and bfs employment income) which is about $35,000. Thinking about where I'd be now if I hadn't gotten sick straight out of art school. Oh I miss scribbling for pay :(
👍🏾
I wish taxes im Germany would be that low. In a business you pay pretty much 50% for taxes and such things...however, you also pay 19% extra for every product you buy and ofc extra extra taxes on various things lika gas or alcohol.
Oof big ouch on my adhd there man. Planning?? Time management?? Wowie this is going to be rough
Where have you been all my life.
We have to calculate about 40% for taxes and costs, on that amount comes VAT, 21%
Would you suggest getting everything in writing?
Yes, always get it in writing.
oh lord - this would not fly in the world of comics tho :D
Why would a company ask for both your day and hourly rate. Shouldn't they add up to be the sum of an 8hr day?
You're also paying for the bills, health, electric, your eyes, wrists, tools, machine, etc..
You're missing when you get really good at something you get faster at it and you're punishing yourself by charging an hourly rate when it should be by the project
One additional factor not covered in an otherwise excellent video. If you were on $75K squirrels (or $12K and an occasional moldy Oreo bonus, if I go by what some of the poor commenters are saying) in your permie job, then you can reasonably begin your calculation - yes, begin; BEFORE the rest of the math - with a number *higher* than $75K. That’s because the permie job’s very permanence (or at least, the appearance thereof) has an economic value. How *much* value depends on a lot of things. Not lower than 10%. Rarely higher than 33%.
What world you are getting these rates ?!
Reality clients pay $2/hour and still asks for unlimited revisions.
Do cash 90 percent of the time and take the card the 10%,
first I always ask for how many squirrels they have in the budget but then they come up with ridiculous rates, especially when it's their first time with an illustrator, which is understandable but still... anyway at the end I feel bad and I always lower the price for A LOT :/ especially in the slow periods. Anyway this video was really helpful, I'll rederect my clients to this video XD
Wow Brad I don't have a lick of what you're talking about smh 😲
Personally, I think the logic behind this model doesn't make sense, because it doesn't take into account a person's skill level.
Just because in an ideal world a person needs X amount, that doesn't necessarily mean they're worth that amount. This is putting the needs of the person before the actual value of the product/service, which is not how pretty much any other profession or economy works. I mean, I'm sure a fast food worker would love their salary to be based around their mortgage, bills, living costs and everything else, but that's unfortunately not how things work.
Don't get me wrong, the expectation artists should work for free or for 'exposure' is ridiculous, but on the other end of the spectrum I see a lot of artists living in these bubble worlds, where their talent or proficiency is irrelevant to their cost.
I do understand your point and "kind of" agree but:
First. Rating your skills (what you worth) is a difficult exercise even more for artists and designers. But it can (and need to) be done by comparing yours and others on the same field and location. So why do brad want 75000$/years? Because it was his income as an employee not a freelancer, it was what he worth when he had the same position in a company. And as a client you will ask for one or the other to complete the job (or am I not aware of a third way?). At the end the bill will be roughtly the same as companies took their charges in account too and they pay you what they think you worth.
Secondly, you said roughly "everyone want to be payed X amount of money because this is their outcome". So let be real. If you do not take in account your budget needs when you seek for a payed job or if you are freelancing, what is going to happen? Would you loose money just for the sake of being a worker? What would be the purpose? Does it mean you will live on bank credit that you cannot refund just to survive 'till it brake? I am sure you can agree there is no point in that.
Per in mind he based his math
Based on his wages he used to get before going to freelance.
Do he used as starting point
Thats one way to look at it.
Other may have no job or no experience
Then if the want jump straight away to freelance, then they can consider the expenses part mentioned in this video and add their rate on top
Atleast they can consider the over all head cost before they go freelance and to be aware of the challenges ahead.
Read the eBook "Breaking the Time Barrier" by Michael McDermott. It'll change your life.
I haven't read that specific book, but I've heard people mention it in podcasts I listen to. I'll have to check it out. It sounds a lot like what I'm doing here building a business more around youtube and tutorials and based less on client work.
Brad Colbow In a nutshell, the book is about pricing based on value and not on time spent. It rocks... especially for people like me that have a crazy fast ADHD brain. Why get paid less for being quick? Check out the ebook and it will all make sense.
John Marshall in that case could it be simply that your time worth more than other in the same field? (As your ADHD brain condition seems to make you quicker than regular one, and not the complete opposite as it would: focus deficiency, lake of working memory, have organisatio problems, be impaired in executive functions...) Calculating an overall value on a project only with it own value seems difficult to me but maybe I'm missing something. I think the solution here would be to work on a overall project price with the client which is mainly done by freelancer on larger project even when they calculate their value on their time spent. At the end both technics are equal to the client: he will have an overall bill or quote (even it it seems easier to break it on a time spent base when they ask "how do you get to that result?" imo)
yeah right.... they said that about the bible
What if just pick some squirrels from the central park?
100 squirrels an hour!!!
How do you store all of them?
I WOULD CONSIDER THIS ANIMAL CRUELTY
Are you sure the 15% in taxes is correct? It sounds like you're saying that freelancers pay the entire FICA portion of their taxes and employees pay none. That's not true. Employees pay HALF of their FICA taxes, so freelancers need to account for the additional ~7.5% not covered by an employers when converting an hourly rate for an employee to an hourly rate for a freelancer.
Those raccoons are getting ridculous these days. Dumpster Unions...of all the insane concepts.
FIRST
Squirls.
What about varying your prices for different clients? It’s one thing to charge $3,000 for a small business logo but quite another if you’re client is Nike. You certainly don’t want to lose money by charging an hourly rate for a logo when it’s a Fortune 500.
Solid point. Changing your rates based on your client is a pretty common practice.
Wow, in my country the minimum wage yearly is aroun 3900 dollars, for me you guys are drowning in cash
Holy cow... you made $75K a year?? I don't mean that as a slight at all, I just didn't realize designers could make that much unless in like New York or something. That's awesome! I thought we topped off at around $60k. And also, as others have mentioned, when the client starts complaining, what *do* you say to calm them down? Also, say you weren't after a specific goal of income...how do you determine how much you're worth?
When you first start out especially, you're probably gonna need to do things based off what income you need to, ya know, live lol. Once you get yourself established there, then you can begin playing with your rates to figure out what you're "worth" if you like. One way to do it (again, after you are established) is to just bump up your rates every so often until you start seeing fewer jobs. Stay there until you start seeing more clients, then start bumping up, again, until you start seeing fewer jobs. Rinse and repeat. This, along with rate adjustments based on proficiency (you don't want to charge the same rate you did when a logo took you 10 hours now that it only takes you 5 hours) is one way to help determine your market worth. I'm sure there's others if you have a look around on the interwebs.
As far as calming clients, it's tough sometimes. Asking them (politely) if they make the same amount of money today that they did 5 or 10 years ago is often a good way to get through to your more logical clients (it's easy for people to not apply the same logic to a freelancer that they do to their own job). Unfortunately, not everyone will be logical. Dealing with those clients, well, it's a crap shoot. Some just like to complain, so you just have to let them vent. Others want to be convinced that what you are charging is fair, and need the cost benefit ratio broken down. Others just want to see if they can bully you into lowering your price (politely stand your ground unless you have reason not to). And sometimes you just have to accept that you are above their price range (assuming you have other clients willing to pay) and move on. As you get better in your field, and your rates go up, some clients unfortunately just wont be able to afford your services. Just wish them luck, and if possible, refer them to someone who is maybe a little less established than yourself (assuming you have other freelancer friends).
15% tax for 75k? 🤣🤣🤣 We are 26% here...
Good video though, keep it up!
Yeah, I'm lucky if I have 18 000 squirrels… I would kill for 75 000 squirrels….
Lets say you have a current salary of 75000 ...
-> let me stop you right there
You are calculating over 6000$ / month? WITHOUT taxes? That is quite a high salary dude. Chill. Here in germany, 3000€ (about 3500$) without taxes is considered pretty high. And that's WITHOUT paying ANY insurances!
You are at almost double of that WITHOUT needing to pay insurance off of it.
Breaking it down, the price is really high. Your choice, and if people pay it, good for you, but don't expect people to change their mind about it being expensive after this video. Especially after you just explained, that you want a pretty luxurious salary.
It definitely varies from place to place. Where I live that's a pretty standard salary for a senior designer. But for the larger cities in the US it's a pretty low number. I know a lot of designers making 6 figures in New York or SanFrancisco.
As a 3d freelance artist I charge $60/hour and I'm in California.
Ok, maybe this explaines alot. Life is probably just more expensive where you live.
In germany, with the equivalent in €, you can live pretty luxurious.
If you look at Switzerland, it's probably even more expensive there... I was just pretty shocked about what you described as normal salary.
Costs to live in areas where it is easy to scout work is massive in the US. It's easy to look at those number a scough at them, but seriously this isn't that high. Also, much of that money you will have to fight tooth and nail for. I'm currently owed well into the 5 figures contractually from various clients and somehow still wondering how in the hell I am paying rent next month. Legal costs associated with chasing those funds are often more expensive than the funds themselves and pissing off the wrong client may burn bridges with several others. Freelance life in the USA is depressing, brutal, amazing, and extremely rewarding all at the same time. We can charge a lot, but we also get screwed in more ways than one and have to shore up funds accordingly.
You do still have to pay insurance, it's just a tax, not a general expense (and cheaper...)