Setting an Hourly Rate

With the new year upon us, some of you may be rethinking your rates... or perhaps you're figuring out an hourly rate for the first time. Either way, this is always considered one of the most difficult tasks for a designer. Fortunately there is a process that will make it easier. You'll need some time for research, and ideally some history on your salaries, expenses, and hours worked, but following a method rather than pulling a number out of thin air should make it all less painful for us creative types.

Do Your Research
While it may only take seconds, don't just pull your rate out of thin air. One way to get started is to see what others are charging, especially those doing the same type of work in your area. Attending networking meetings is a great way to meet others in your field, as is taking classes in design... especially if you didn't go to design school. Once you have established a good relationship with a few designers, don't be afraid to ask what they charge now or what they have charged in the past if they are more experienced than you.

It is also important to find out what full-time jobs are paying in your area that you are qualified for. This will help in calculating an hourly rate. The AIGA/AQUENT annual design salary survey is a great resource. You can also check local job listings to hopefully get a salary range for a variety of design jobs.

Test It Out
Once you've set a rate, it will take some time and several projects to determine if it is realistic. If you are not landing jobs, try to find out from the potential clients what their reasons were for not hiring you. Perhaps you are priced too high. If you find people are accepting your hourly and project rates without hesitation, perhaps you are charging less than some of the competition... which isn't always a bad thing as long as you are fairly compensated.

Projects and Clients Differ
You may find that you need to have more than one hourly rate to get the projects you want. For example, it is common to charge your standard rate for corporations but have a discounted rate for non-profits. You shouldn't just charge more because a company can pay more... but you may want to charge a little less to work with a non-profit or individual. This is a personal choice... and based on factors such as the benefit to your portfolio and potential for follow-up work.