When I first started to consider freelancing a legitimate career choice, one of my first questions was, how do freelance writers get paid? If you’re thinking about quitting your job, changing careers, or just picking it up as a side gig, understanding how freelancers are paid is important. Even though I love writing, I’m still here for a “paycheck.” So in this article, you’ll learn how freelance writers are paid, how to invoice, and how to increase your income. Let’s dive in!
Table of Contents
Hourly, Daily, Per Word, Per Project, Retainer
Before you can think about what invoicing software to use or what bank accounts you’ll need, you need to figure out whether you’ll charge by the hour, word, project, or something else and what factors to include when setting your rates.
Freelancers commonly have hourly, daily, per word, per project, and retainer rates. These can vary from freelancer to freelancer, client to client, and project to project, so I’ll break down each.
Hourly
Charing an hourly rate is precisely what it sounds like. You charge your client for each hour you work on a project for them. For example, you write a blog post for a client at an hourly rate of $40. If that blog post takes 4 hours to write, you will charge them $160 for that one blog post.
Hourly rates are most common for smaller tasks or projects that are easy to quantify in small units of time. Freelancers considering charging hourly rates include virtual assistants, social media managers, and editors.
Daily
Similar to hourly, charging daily is when a freelancer charges a client per day of work. You might also hear this referred to as a “buy my day” offering. This rate is uncommon, but it may be valuable for some of you.
Discussing what constitutes a “day” with clients before signing a contract is important. Make sure to include that definition in your contract too. Some clients may consider a day 8 hours while others consider it 7 or 9 hours.
Per Word
A per-word rate is when you charge your client based on the number of words in a project. For example, say a client wants a 1,000-word blog post, and you charge $0.25/word. At that rate, the total you charge for the project will be $250. This pay rate is common for writers, including content writers, copywriters, scriptwriters, and novel writers.
While nothing stops you from charging for every word, many writers use pricing bands to simplify and add flexibility to their pricing structure. For example, you could offer blog posts between 1,000 and 1,500 words at a flat rate of $300. Regardless of whether the final project is 1,100 words or 1,490 words, the payout remains the same.
How large your word bands are is up to you. But this can generally give you a range of words to fall within rather than trying to land precisely at 1,000 words. And it can also help clients feel like they’re getting more value for their money.
Per Page
Per-page pricing is when you charge the client based on the number of pages you submit. Freelancers who adopt this pricing model often fall into web page content, lead magnets, and book writing. Remember that a web page is very different from an ebook page. While an ebook page has limits to what it can reasonably contain, a web page does not. So make sure you discuss expectations for the scope of your project when signing your contract.
Other projects that work well with per-page pricing include editing and proofreading, creating downloadable how-to guides and templates, worksheets, and writing white papers or case studies.
Per Project
Charging per project is a simple way for freelancers to charge clients based on each individual project. Unless your client only has one consistent type of project for you (like 4 1,000-word blog posts month after month), this rate will likely vary from project to project.
This pricing style is the most common choice for freelancers, including web developers, writers, video editors, and graphic designers. That’s because the time it takes to complete a project does not always correlate to the value of the project or the expertise you bring.
For example, say a client asks for a 1,000-word blog post. If I’m an expert in the topic and an experienced writer, it may only take me 2 hours to write it. At a decent hourly rate of $60/hour, that means I would make $120. If I quote a project-based rate of $250 (which is based on my typical rate of $0.25/word), I would earn over double the hourly rate for the project.
In that example, the hourly rate punishes you for building up the skills to write high-quality content in less time, which is the opposite of what you want. Part of why you learn to write better and fast is to enjoy the benefits of higher rates. The project-based rate looks beyond how long the project takes to complete and incorporates your experience, market value, and skill.
On Retainer
Last but not least is the monthly, quarterly, or annual retainer. You’ve probably heard of a retainer on T.V. in reference to a lawyer. Simply put, a retainer is when a company/client pays for your dedicated time regularly, regardless of whether or not they use your services within a given timeframe.
So what does a retainer look like for a freelancer? Let’s say you’re a writer. If your rate is $0.10/word, a company could put you on a retainer for $1,000 per month. That means they could send you up to 10,000 words worth of projects each month.
They may send you four 2,500-word posts or 10 1,000-word posts. However they choose to do it is set by your contract. But, if they only need two 4,000-word posts in August, they are still required to pay you the full retainer.
Retainers are great for both the freelancer and the client because they encourage you to build a long-term relationship. Additionally, as a freelancer, you’ll have a better idea of how much income you’ll generate over a month, three months, or longer.
Any freelancer can utilize this pricing structure, from social media managers and virtual assistants to web content writers and blog post writers.
What to Consider When Setting Your Freelance Rates
Now that you have a better idea of how you’ll charge for your freelance services, you need to understand what to factor into your budget. When you send an invoice to a client for $1,000, it’s not the same as receiving a paycheck of $1,000.
If you’re on a payroll (in other words, a W-2 employee), your paychecks already have taxes, social security, and insurance taken out. The number you see deposited into your bank account is money you can spend.
As a freelancer without an employer, you have to set money aside for these things yourself. So in this section, I’ll cover the 4 most common expenses you need to consider when setting your rates. They are:
- Taxes – Generally, most freelancers set aside roughly 30% of their income for taxes.
- Retirement – Generally, people stash 10-15% of their income into retirement assets (like a 401k). Decide how much you want to stash in a retirement account regularly, write it down, and put it away just like you do with your taxes.
- Insurance – If you live in a developed nation that does not include the U.S., you can likely skip this expense. If you’re in the U.S. but fortunate enough to have an employed spouse, they may be able to pick up healthcare as a benefit from their employer. Otherwise, you’ll need to arrange for health insurance yourself. This starts at around $100 monthly for a bare-bones policy can quickly climb into the hundreds.
- Cost of Operating – This category often includes recurring expenses like software, editing tools, or technology. The total cost will vary depending on the size of your business and the things you include in this category.
For example, my invoicing software is $25, email is $6, and Grammarly is $12. Altogether, I spend roughly $43 to run my business, but I budget $100 to account for the occasional one-time expense like buying a new mouse or hiring a virtual assistant.
There is no set rule for how much you’ll spend on these things. But as an example, if taxes are 30% and retirement is 10% of your revenue, that means 40% of what you bring in each month (monthly revenue) needs to be set to the side, leaving you with only 60% of what you make.
As you can probably tell, it’s REALLY important to figure this out before quitting your day job.
Let’s say your monthly household expenses are $3,000. That includes car payments, groceries, gas, gym membership, streaming, and dog food. That does not mean you need to make $3,000 in monthly revenue. Instead, it means you need to make closer to $5,000.
Calculating Your Own Revenue, Income, and Expenses
Here’s the math to determine the total revenue you must make each month.
Step 1: Determine what percentages you need to set aside for savings. That includes taxes, retirement and anything else. Add those percentages up for a total percentage and subtract that from 100%.
For example, taxes (30%) + retirement (10%) = 40%
100% – 40% = 60%
Step 2: X * 60% = Y
In this equation, X is the monthly revenue you need to make, Y represents your living expenses, and 60% represents what you’ll have left after savings and taxes are removed. Since we established that you need $3,000 for living expenses (in our example), plug that in for Y.
Step 3: X * 60% = 3,000
Then, we need to rearrange the equation (think back to your high school algebra days).
X = 3,000 / 60%
Step 4: Plug this new equation directly into your calculator. If your calculator doesn’t have percentages, then convert your percentage to a decimal. In our scenario, 60% = 0.60.
3,000 / 0.60 = 5,000
This means we’d need to make roughly $5,000 to have $3,00 after retirement savings and taxes are removed from our monthly revenue.
That can feel pretty scary at first, but don’t let it discourage you from taking moving forward with freelancing. What’s important is that you’ve defined your income goal and understand the math you need to get there. If the numbers in my example don’t fit your budget or lifestyle, adjust the Y value and percentages until they reflect your current situation.
What Freelancers Need to Know About Invoicing and Bank Accounts
Next in understanding how freelancers are paid is the actual invoicing. I remember being super nervous about sending my first invoice. I had a ton of questions running through my mind. Do I look professional? Am I doing this right? Are my rates too high?
Let’s put a few of those nerves at ease by looking at how often you should invoice, which software to use, and how this works with your bank.
Invoicing Frequency
Your chosen rate style may affect your invoicing frequency, making it easier to establish this at first. For example, a monthly retainer will obviously be invoiced on a monthly basis. Other common frequencies are weekly and per-project invoicing.
Ultimately, how often you invoice is something you should determine with your client when you’re starting the relationship and writing your contract. Their business may also have specific rules or expectations around invoicing, which are important for you to know.
Decide on a frequency you like best, and then try to arrange that with your client.
Do freelancers need invoicing software?
In short, no. You do not need dedicated software for invoicing, but you do need a system to manage your invoices, be that an Xcel sheet or a notebook. Still, reliable software can make it easier to track invoices once you have an established freelance career.
Tools like Quickbooks, Harlow, and Bonsai can make it easier to create professional invoices, track them, take payments, and send reminders all in one place without much thought. If you’re not quite ready to pay for a service yet, or just don’t want to, a service like PayPal will let you send free invoices and charge a fee of roughly 3.5%.
I use Bonsai (#notsponsored #notanad). I chose them because they have contract templates specifically for freelancers. I also created a checking account for the money to go into, and the software automatically separates my invoice payments in percentages. 30% goes into a tax account, while the rest goes into my main account.
They’ve recently added a meeting tool, similar to what Calendly does, that lets me use a meeting link to schedule client meetings. I also use their forms tool for things like collecting testimonials. And recently, I linked my business credit card so the accounting section of my account logs my purchases and stores them for tax season. At $25 a month, I’m pretty happy with what I get! But this brings me to business bank accounts. Do you need them?
Do freelancers need a business bank account?
Again, this blog is for informational purposes only, and you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
When receiving invoices, you don’t need a “business” account. Clients can settle invoices in various ways, including credit card payments, direct transfers, wire transfers, or PayPal. Most invoicing software will include integrations for Stripe (credit card payments), but what’s allowed will vary from service to service.
For most freelancers, especially those just starting out, a regular personal checking account will work just fine. To keep things neat and tidy, I recommend designating one checking account and one credit card for all of your business-related expenses.
I use the Capital One Quicksilver card (affiliate link) for all business-related purchases. I also have a savings account just for tax money. Neither of these are classified as “business” accounts by my bank, but they make tracking business expenses easier. I know the entire balance on my Quicksilver card is just from business expenses; it’s not a mix of groceries, eating out, business, and bills.
Managing your business finances in separate accounts also makes it easier come tax season. Like I mentioned before, my credit account is attached to Bonsai. Bonsai automatically imports all the purchases from that account and can export them in a nice document for my accountant. This helps make sure they can write off what they need to when my taxes are filed.
So no. You don’t need a capital-B “Business” account, but a designated checking and credit account for business-related purchases and expenses will make taxes and income/spending tracking 10 times easier.
Business Accounts for Freelancers
If your business has grown beyond what you need to meet your full-time needs, it might make sense to leap into business checking and credit accounts. These accounts generally come with higher fees and larger deposit requirements, which is why it might not make sense for a beginning freelancer.
On the flip side, business accounts can also give you access to features that can enhance your business. Things like cards for employees and bookkeeping integrations are two examples of how business accounts can make your finances easier to manage.
How to Increase Your Freelance Earnings
Maybe you’ve already started freelancing on the side and are wondering how to increase your freelancing income. Or, perhaps you haven’t started and already want to know how to make more. While countless factors play a role in establishing your freelance rates, here are 4 that can help you make more money.
Take on High-Value Projects
The type of projects you take on will significantly affect your bottom line. In general, the easier it is to track return on investment (ROI), the higher value your project will be perceived to have.
For example, a landing page written by a copywriter can easily track conversion metrics, giving the client a clear picture of how well the page is working to drive sales. On the other hand, a blog post about how to grow a YouTube channel might not sell viewers on a product as much as it educates them on the topic at hand. This content still has value, but it’s further removed from the sale in the overall customer journey, meaning viewers might purchase after watching 10 videos and visiting the website.
Examples of high-value content for clients include:
- White papers
- Landing pages
- Case studies
- Email campaigns
- Blog posts that drive sales
Choosing to take on more of these projects means you can charge a higher rate because it generates more money for the client in a clear and trackable way. But, it’s not the end all be all either. I’m a freelance writer specializing in SEO blog posts and I do just fine.
Build a Professional Online Presence
Clients only care about one thing, can you do the job? A well-thought-out and curated online presence will help your potential clients answer any questions about you in as little as 5 minutes.
Your online presence can include LinkedIn, Twitter, Instagram, a blog, YouTube, and a portfolio site. At a minimum, you should have a LinkedIn profile. In addition to that, I recommend having a portfolio site.
A portfolio site is the only place where you can control every detail of what shows up on your client’s screen, from your name and picture to the colors of the page, images, and fonts.
Building a website can be overwhelming. There’s no sugarcoating it. But a website like Wix can help you create a portfolio site with minimal tech knowledge. If you’re up for more of a challenge and a more custom website, you can build it on WordPress (that’s where this site and my portfolio site were built).
While my portfolio site isn’t perfect, it’s helped me earn clients. On it, I have:
- A home page with a brief get to know me section and client testimonials.
- An about me page where clients can learn more about me
- A services and rates page that breaks down what I offer, what’s included, and what I charge
- Samples of my work are located on the portfolio page so they can see my work in action
- A contact page where they can submit a form or find me on LinkedIn, Medium, or Twitter
How you build your portfolio site is up to you. For inspiration, check out sites for freelancers in the line of work or niche you want to be in, draft up some ideas, and get building. My site is my digital home, and your own site can help you cross the finish line and sign more clients.
Here are some examples of great portfolio sites:
Freelance Writer Portfolios:
Freelance Web Developer Portfolios:
Freelance Photography and Videography
Niche Down (Specialize)
Next up is niche. A niche is a specific area of focus in your field. For example, if you’re a photographer, you could specialize in pet portraits, engagement shoots, or professional headshots. Each of these represents a very specific kind of photography. For example, Elle Michele specializes in beach photography.
How does this affect how much money you make?
Clients will pay more for specialization. Why? Because it means that your skills are specialized in exactly the service they need. If I’m looking for a beach photographer, I want to see a portfolio with beach photos, not a volleyball team. If I’m spending hundreds of dollars on photos, I want to know the photographer is familiar with the sandy terrain, the windy ocean air, and the changing weather beforehand. The same applies to whatever your freelance field is.
Admittedly, I started as a generalist. I wrote blog posts for anyone and everyone (and I loved it). I even made it full-time doing that. But, picking a niche can help you achieve your goals faster simply because clients pay more for specialization.
Earn Experience
Finally, your experience level will help clients determine if your services are worth the rate you charge.
You might be thinking there’s not much you can do about this. Wrong.
The best thing you can do to get more experience is to start. Start today. Build your portfolio site, create a few samples from scratch, and send cold emails or proposals. Create a gig on Fiverr or a profile on Upwork and send 3 proposals today.
However you decide to start is up to you, but don’t keep putting it off by asking endless questions in online forums and watching countless YouTube videos. The best way to boost your income and gain experience is to start right now.
How are Freelance Writers paid: Frequently Asked Questions
Still have questions? Here are some commonly asked questions about how freelancers get paid.
How are freelance writers paid?
Freelancers can get paid hourly, daily, per word, per page, per project, or on a retainer. How a freelancer is paid is decided between the freelancer and the client.
Payment frequency may also vary and will depend on terms set by all involved parties.
Paid invoices may be deposited directly into the freelancer’s bank account, an invoicing software, or some other service (like PayPal).
How Much do Freelance Writers Make per 1,000 Words?
The rate a freelance writer makes per 1,000 words varies based on the freelancer, experience, the client, the niche, the location of the freelancer, and the project at hand. Per-word rates can begin at lower than a penny per word and reach over $1/word.
In general, beginning freelancers can make between $50 and $250 per 1,000 words, while more experienced freelance writers earn between $150 and $1,0000 per 1,000 words.
How do You get Paid for Freelance Writing?
As a freelancer, you get paid directly by your client. You will send your clients an invoice for completed services, and they will pay using a credit card, debit card, ACH transfer, wire transfer, or some other method.
How Much do Freelance Writers get Paid per Article?
The rate a freelance writer makes per 1,000 words varies based on the freelancer, experience, the client, the niche, the location of the freelancer, and the project at hand. Per word rates can begin at lower than a penny per word and reach over $1/word.
In general, beginning freelancers can expect to make between $0.05/word and $0.25/word based on various factors, with experienced freelancers making $0.15/word up to $1/word.
You Choose how to get Paid as a Freelancer
Freelancers can get paid in a variety of ways, each with its own benefits and drawbacks. Most freelancers will prefer monthly retainers or per-project rates, but this may change depending on the kind of work you offer. Ultimately, as a freelancer, you have the freedom to choose how often you’re paid, where the money goes, and where it comes from. You should make that decision based on what works best for you and your client.
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