The Copyeditor's Desk

Mrs. Micah, over at Finance for a Freelance Life, offers an interesting rumination on setting fees for freelance writing and technical consulting. She starts at the premise that one will charge an hourly rate and then touches on some signal issues for writers: the question of what your time is really worth and the matter of estimating how much time and energy a project will demand.
written by vh for The Copyeditor’s Desk. © 2008
Meanwhile, at about the same time, veteran editor Katharine O’Moore Klopf posted an article at Editor Mom that touched obliquely on the subject as she made some suggestions for where to find experienced professional editors. Take note, here, of this important statement:

In general, you won’t find the most professional or experienced editorial professionals on Elance.com [or on other sites like it, such as Guru.com], because the way Elance is set up encourages freelancers to outbid one another, to the point of lowballing. Those rates may seem reasonable to you, but they’re starvation pay for freelancers. With the rates that most projects go for on Elance, you’ll often wind up with the inexperienced newbies and the less-talented freelancers whom few other people will hire. You’ll be paying Walmart prices and expecting to get Saks Fifth Avenue work, but guess what you’ll often get instead.

Most writers and editors underestimate the value of their time and skills. It takes real talent to write well. And a editor gets to be good through broad and deep education. Each of these characteristics—talent and education—are worth a great deal, and when they’re combined in one package, they’re worth even more. No one should work for less than a living wage (the federal minimum wage, which is not a living wage, is now pegged at $7.25 an hour).

I’d like to address two facets of this issue: first, how to estimate what you need to earn; and second, how to get it from clients who in fact do think they should pay Walmart prices for Saks Fifth Avenue work.

Valuing Your Time

The first order of business for a freelancer in any business is to figure out how much she or he needs to earn, per hour, to cover living expenses and overhead. To begin, you need to estimate how much net income you will need to keep a roof over your head and food on your table. Elsewhere, I have figured that I would need to net a bare minimum of about $27,800 to maintain a crimped version of my present lifestyle, were I laid off (my current net from a middle-income salary is a little over $39,570).

Starting from your projected net, you need to add the following expenses:

· Taxes (state and federal income taxes; property taxes; vehicle registration fees, etc.)
· Health insurance
· Retirement savings
· Membership in professional and trade organizations
· Computer equipment
· High-speed computer connection
· Office supplies
· Increased utility bills resulting from working at home
· Unreimbursed work-related travel
· Incorporation and other legal and accounting fees

The largest of these will be health insurance and taxes, and unfortunately, they are the two items you can’t omit from your calculations.

For me to net $27,800, I would have to gross about $34,760.

Once you have an idea of how much you want to gross, you need to translate that to a rough hourly rate.

Let’s suppose I put in 40 billable hours a week, 50 weeks a year. Forty hours times 50 weeks gives me 2,000 billable hours; dividing 2,000 hours into $34,760 gives me a rate of $17.38 an hour.

O.K. Now let’s get real: to get a freelance business going and keep it running, you need to sell, sell, sell. A good 40% of your time will be spent on marketing and networking. A far more likely figure for billable hours is something like 20 hours a week, or 1,000 hours a year. That is, to earn $34,760, you’ll need to charge $34.76 an hour.

That represents a very modest income. If you live in a big American city, it will buy a lifestyle best described as “ascetic.” You probably will have to reside in a small town to live comfortably on such an income, especially since you will experience periods when no work comes in. This means that realistically you need to charge a much higher per-hour rate.

I aim for $60 an hour, and I’ve had clients suggest that is too low. Others suggest it’s too high, often by fainting dead away when they hear it.

At $60 an hour, if I worked 20 hours a week and gave myself a two-week vacation, I would earn $60,00 a year. My freelance activities earn nothing of the sort, of course, largely because I don’t work anything like that many hours.

Making Your Charge Palatable to Clients

Few people will pay an English major $60 to an hour, not even one with a Ph.D. The first thing that pops into their minds is that they can’t afford it. Second thing they think is that your highest and best use is teaching high-school or grade-school English for around $24,000 a year, an amount that would net you something like $9.60 an hour on a gross of $12 an hour (figured on a 12-month basis, which is how long you have to make that nine-month pay last). They think, my dears, that you have got your nerve to ask for a living wage.

So, what you  need to do is present your fee in a way that does not readily make your hourly rate clear. How? Translate it to a per-page rate.

How to Calculate a Per-Page Rate

a. For writers

To achieve that and do it fairly for you and for your client, you need to know how long it will take you accomplish one page of work. As an editor, how long will it take you to edit a page of copy? Or, if you’re a writer, how long will it take to write a page?

Obviously, this varies according to the kind of assignment you’re presented with and according to experience and expertise.

I can write and revise a 1,600-word feature article for a magazine or newspaper in two to four hours. But the writing is the easy part: to gather the material to compose such an article, I have to do a lot of research and interview a half-dozen sources. Each of those sources has to be reached on the phone or in person; this generally requires getting past a gatekeeper and then waiting for the person to return a call. It may require going to the person and spending upwards of an hour in a face-to-face interview. Assuming, optimistically, that I spend about 40  minutes tracking down and interviewing each of six subjects, that’s another 4 hours of work time right there…before I locate printed material and read it. Let’s add another 4 hours, then, for reading articles, books, and online materials. A four-hour project has now morphed into a 12-hour project, and that’s a pretty modest estimate. In fact, it’s likely to take much longer.

All of which is to say a simple magazine assignment can be expected, conservatively, to take a day and a half of work time. At $60 an hour, I should get no less than $720. Sixteen hundred words amounts to about 6.4 pages of typed copy. So, dividing 1,600 words by 6.4 pages, I should get $112.50 a page for a simple, straightforward magazine article.

Now, here’s something many beginning writers don’t know: $720 is cheap for a professionally written magazine article. I wouldn’t touch a feature assignment for less than $1,000. It’s just not worth my time to do it for less. Believe me: it will take more than 12 hours to complete.

Why don’t beginning writers know that? Because editors charge what they think they can get away with, and what they can get away with is outrageous!

Why can editors get away with taking outrageous advantage of freelance writers? Because writers don’t know what their time is worth! And because you are competing with people who write for ego gratification, not to make a living. Editors know they can find people who will do the job for the sheer joy of seeing their byline in print, and who will think a $300 fee for a $1,000 job is just pure gravy.

This is why, if you simply must try to be a freelance journalist, you should join an organization such as the American Society of Journalists and Authors, where you can learn from other writers how much they are being paid and what is considered a reasonable rate for a professional job.

It is better, IMHO, to write for businesses, where the custom of paying for value received is more widely  honored than in journalism.

Writing is hard work. That is why my rate for ghost-writing or cowriting a book-length work is $60 a typed, double-spaced page or, for writers who already have a contract, 100% of the author’s advance (minimum $20,000) plus 50% of royalties. This is based on a track record that includes four books published with prominent national presses, one of which was a best-seller. Less experienced writers might charge less, but anything below $30 a page may not pay you for your time. You should get between $10,000 and $20,000 to ghostwrite a book; at $20 a page, a 350-page manuscript would gross a mere $7,000…for what could easily be six months to a year’s worth of full-time work.

In any event, rather than citing a per-hour rate that may scare a client off, consider the nature of the assignment, estimate how long it will take to perform the assignment, multiply that amount of time by your targeted hourly wage, and add 25 to 50 percent for Murphy’s Law. This figure is the amount you should ask the client to pay for a proposed project.

Don’t ever agree to do a writing project on spec. And remember: “pay on publication” often means “pay never.”

b. For Editors

Editing is less difficult, although to do it well requires broad experience and a good education. If anything, the skills required to edit copy are more complex than those needed to write copy, especially if the copy consists of workaday newspaper, magazine, or website content. However, because one usually doesn’t have to spend hours in research and interviews, the immediate job feels less challenging.

At The Copyeditor’s Desk, our fee schedule is based on the estimated time it takes to edit or proofread a standard double-spaced page depending on the difficulty of the copy. The amounts we quote average out to about $50 an hour, which should net the editor $25 to $30 an hour, leaving $20 to $25 an hour to cover overhead. As a practical matter, if you billed 20 hours a week, that would give you an annual gross income of $50,000, from which you would have to pay the extravagant cost of individual health insurance and self-employed FICA (double the amount of FICA you pay as a salaried employee). For anyone living in an American city, that represents a net that’s just in the middle-income range. Remember: your net is 50 to 60 percent of gross.

With this in mind, when a client approaches us, we ask to see ten to twenty pages of the project from more than one section of the copy. (Writers often will start out gangbusters but fade as they plod toward the end, and so material deeper in the document may be significantly harder to edit than the first few pages.) We then sit down and edit the sample copy, timing the process. From there we can extrapolate how difficult the material is and how long it will take us to read it. The harder the copy and the more time it will consume, the higher our per-page rate.

The Advantage of Charging Per Page or Per Project

Experience shows that when you cite an hourly rate to a client, the client is daunted by the uncertainty of how much the final bill will come to. What, really, does $15, $20, $30, $60 an hour mean? The client is right to worry about this.

Even if you give the person an hourly rate with a cap, you still present an ambiguous proposition. So, the client thinks, this project should cost me $850, but I could end up paying less than that? If this person charges the whole $850, do I know whether she really put in that many hours? Additionally, unless you’re dealing with highly paid professionals or business executives, most people don’t earn $60 an hour. Most people don’t even earn $40 an hour—that would be $80,000 a year. Because they don’t have to pay their own overhead—because their employer is paying for their office, matching their 401(k) contribution, and covering a large share of their health insurance premiums—they don’t recognize that what you’re asking is actually about what a person who earns $40,000 or $50,000 a year costs his or her employer. They register a $50- or $60-an-hour fee as exorbitant.

For that reason, a fee that has a predictable bottom line sounds more reasonable, even if it amounts to more than the person would pay if it were prorated out by the hour. So, when you ask for a per-page or per-project fee, you’re more likely to earn what you’re worth.

Related posts:

• Starting Out as a Freelance Editor
• Contracts: Negotiating an indemnity clause
• Manuscripts: Saving Time and Money 3

This entry was posted on Saturday, December 27th, 2008 at 1:19 am and is filed under Editors, careers, writing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.