Along with the freedom and what have you of being a freelance writer, comes the reality that you don’t have paid sick leave. At the moment my back is ‘out’ and that means pain, restricted movement, inability to sit and work for long periods and pain. My vacation didn’t cause the back issue, that was a week after our return while vacuuming the car. The real problem is that on coming home you have to hit the ground running and get back into the work schedule as quickly as you can. I was home from the airport at 2:30pm and out to teach this term’s Creative Writing class at 6pm. A week later, I had to hobble in with a walking stick so hopefully next week I will be 100% again.

As a freelance writer you must accept that if you don;t work, you don;t get paid. Short of passive income in the form of royalties building up thanks to sales of my books, I only eat when I get paid for something I wrote or at the end of the term for teaching. Cashflow is a major concern for all businesses and no different if yours is a writing business, online or off. Sometimes demands on your cash can come in banana bunches and if you just spent most of your money on a vacation, this can be a problem. A week after returning I had my first car accident for 25 years and now look like having my car written off as unrepairable, simply because it is not worth much… to anyone else. To me it is worth as much as a new Land Rover Discovery4! If I clear a grand from the insurance, what will I replace it with that is as reliable as the old ‘Ninky Nonk’?

Car accidents, back injuries, an oncoming cold and some serious pressure to get some work in, done and out and paid for it all takes its toll. If you can’t handle these kinds of pressures and times, think very carefully before you tell the boss where to put their job! If you have so much cash in reserve these problems aren’t problems, you are probably not a freelance writer or, you are one of the very few, well established professionals with good contacts and clients and lots of work lined up plus money in the bank. It is doable, but make sure you consider these possibilities (vacations, injury, accident etc) when you plan your break into freelance freedom.

One of the things many eWriters discuss with me is how long it takes to build up a decent online writing business. Basically ti takes different lengths of time for each of us as we all do the marketing differently and we do the work differently too. I can say I have been doing this full-time since September 26, 2009 and I am only now, April 12 2013 really feeling it is picking up and doing fairly well. Of course I still tutor and lecture but I am getting more and more eWriting assignments.

I have recently completed an eBook for a US client on budgeting and good money management practices for small business professionals and freelancers. I also won a contract to ghostwrite and autobiography and I am chasing several other jobs. One came through but then the client fell off the wagon and hasn’t been heard of since. It happens. It is not a job until the money is in escrow (Elance etc) or they have signed and returned a project agreement and the deposit is in your bank account or PayPal account.

I must say, since increasing my fees and insisting on them I have had no problems with clients either accepting my bids or choosing others. When I get the job I am happy because I am getting paid a fair amount. If I miss out due to bidding too much for their taste or budget then that is ok as we would not have been happy. They would begrudge the ‘extra’ money they would pay me if they paid my asking rate and I would begrudge them having to do the job for such a low rate if I had to discount to win the work.

Right now we are less than three weeks off our vacation to Singapore and the Philippines. A working vacation for me but one I will love. Having the family with me this time will be fantastic. I will get the chance to update my StreetWise Philippines series of self-help eBooks and spend some great time with the family. So how can we manage this on a freelance writer’s pay? Well, first of all we took advantage of special low fare deals and adjusted our dates to suit. We saved up and had cash ready to go to take advantage of the deal when it surfaced, and it was quickly sunk by the rush of buyers! We have said ‘No’ to the kids for all non-essentials and most ‘wants’ for months and gone without ourselves but all in a good cause. You see, it is how my parents taught me and my wife’s taught her: you can’t have your cake and eat it too. Sometimes you have to sacrifice something to get the thing you really want.

So you can make a living as a freelance eWriter and take your family overseas and pay all your bills. I do and while we don’t live in a McMansion, we are happy with what we have. That’s another secret for success as a freelance eWriter: adjust your expectations to match your reality, then look to the work and the rewards will follow.

I have an hourly rate of $50 and I need to double it. Fifty bucks an hour! Wow! That’ is huge! Is it? Consider how much a garage charges to service your car. I recall back in 1997 the prestige motor vehicle dealership I was selling cars for had an hourly rate of $105 and were putting it up to $120. The odds were an apprentice would be doing most of the ‘grunt work’ like changing oil and filters, taking wheels off and checking brake pads and so on. The qualified ‘technicians’ (a cut above mechanics, apparently)went from car to car doing the more technical jobs or overseeing the apprentices. There was even a $20 charge added to every bill for ‘ workshop sundries’, meaning cleaning rags, hand cleaner in the washroom and so on. Nobody escaped a basic logbook service with much change out of a grand. But if you want your car serviced, you pay.

I went to the dentist the other day and had my daughter’s teeth cleaned, checked and one of them extracted. I have health insurance that pays 65% of the cost of most things and all of the cost of ‘basics’. One would have thought a clean and scale was a basic item and it was. For her. For my wife it was additional as she needed some gum treatment. $240 additional for less time in the chair! But if you want your teeth fixed, you pay. Why so much for a job that took maybe ten minutes and used up very few materials? Or did it? How much was the chair, the x-ray equipment, the rent on the premises? The advertising to compete with outer dentists and the cost of keeping the doors open? The year’s in Dental School?

What about the workshop with the ten hoists, full store of tools and spare parts, a dozen or more technicians and all the other overhead that goes with running a service center? We seem to accept we have to pay for our cars and our teeth but not for getting something written. After all, the writer loves writing or they wouldn’t be doing this, right? Anyone can write, we all get taught at school so what’s the big deal, right? We all brush our teeth and changing the oil isn’t difficult either but perhaps for the more technical things we need a professional?

I have on my desk a 27inch iMac, along with a MacBook Air laptop, an iPhone 4, a printer that scans (sometimes) and copies as well as a back up one just in case. I also have to have internet access, mobile phone connectivity and of course paper, ink and stationery. It all costs money. I have to have electricity, insurances and a motor vehicle, my license, maintenance on the car as well as fuel and clothes to wear. Everything costs money. On top of this I have professional association expenses, licenses and let’s not forget ongoing education expenses. There is the aforementioned health insurance as well as needing a basic wage to live off. No doubt you have these items of essential equipment too. Even if you got them while still working a full time job, they had to be paid for and one day they will need to be replaced.

If you charge $50 an hour and would like to earn the equivalent of just $52,000 pa, then you need to make $1,000 per week, every week. That means 20 hours of work. So what do you do with the rest of your week? Never forget for every hour you can bill you will spend at least the same amount of time looking for that work. Then there are the hours you spend on administrative tasks like sending those clients their invoice, waiting for the payment, managing the money when it comes in and so on. So that covers your salary and a pretty modest one at that. Now what about all those expenses? When you are self-employed you have to pay for all the equipment, services and insurances and such. Even if we accept you work harder as a self employed person than as an employee, at least as far as the number of hours you put in, we should not be factoring more than a 40 hour week. Why work more? Didn’t you take the risks of self employment to have more time for yourself and your family? A better work/life balance? Of course you will probably work far more but let’s use the same number of working hours as the average wage slave.

Forty hours a week means 20 hours of billable time. At $50 a week that gives you just $1000 a week. If you are off sick, don’t work public holidays and maybe take a vacation each year then in the 48 or so weeks a year you will be operating you can expect, providing you have those 20 billable hours every working week, an income of $48,000. Actually that is turnover. Gross turnover. Even if you were able to bill for all 40 hours, that is still just $96,000 for the year. If you pay yourself a salary of just $52,000, you will need to deduct income tax from that. You should add to that 9% superannuation if you are an Australian, so that is $4,680, leaving you $39,920 for all the other expenses. Workers Comp insurance, professional indemnity and public liability insurance, car insurance, property insurance on your office and equipment, utilities like electricity, phone, broadband, stationery supplies, phone, computer, vehicle and transportation costs, advertising, web site hosting and so on. If there is anything left it is net profit and guess what? You’ll have to pay tax on it.

This presupposes you bill 40 hours a week. Less than that and you are not in business, you are saving the government the trouble of having to include you in the unemployment statistics. Now, charge $100 an hour and you can work less, make more and enjoy the process. If it takes you at least an hour to find a billable hour’s work at $50/hr, I am sure it will take just as long at $25/hr. Even if it takes longer to get the higher rate, in time as you establish a clientele the time spent finding will lessen and the hours spent grinding will increase and so too your income. So why not value yourself at $100 per hour?

You can read more about this concept of charging what you are worth over at Carol Tice’s web site. Click on the Writer’s Den on the right of this article and step up in the world of freelance writing online.

Reading an article by Carol Tice of ‘Make A Living Writing’ fame about being addicted to the ‘Heroin of Freelancing’ made me think. While I agree in the main with Carol’s views on content mills and low-paying writing sites, I think she is not 100% on the money as far as Elance is concerned. Yes, there are thousands of writers subscribing to the crowdsourcing job site but few jobs I bid on have more than ten and usually no more than five bidders. I have seen as many as 30 bidding for a job paying virtually nothing, but you need to look at the job and the bidders to put it all into perspective. To grab some context as they say.

Elance does have work and you can win jobs; I won one last week for a US coach and mentor who needs some help pushing her latest book, ‘The Renegade Leader’ and some consultation on marketing the next one in the pipeline. This client is one of the top people in her profession in the world, let alone the USA and has published books co-written by Stephen R. Covey (The 7 Habits of Successful People) and Ken Blanchard (The One-Minute Manager). Yes, I bid low for the job (hourly rate) but not because I was concerned about competition as much as I wanted the chance to work with this person. I will glean a lot more in value from working with her than I can put a dollar figure on. I have already been given a complimentary copy of her book and that was certainly worth my time to read it. See, it’s not always just about the bottom line.

I checked out some of my Elance competitor bids and the earnings they have listed for the past year. Not all time, but just the most current earnings period. I am listed at a few hundred dollars as I haven’t been very active there of late. Some bidders have thousands of dollars in earnings listed and others, hundreds of thousands! This is not something the bidder can fake. The system will either not show their earnings if they wish to keep it private, or they will show what the system’s records have as the amount earned. My point is this… some people are making very healthy incomes from Elance work, so why can’t you or I?

One bidder, ‘Words You Want’ has made $361,616 in the current period, averaging just $430 per job. A husband and wife team (or brother and sister), they run a tight ship as a visit to their web site attests. They don’t start work until either the money is in escrow (Elance) or they have been paid 50% of the project fee. No work under $100 a time is accepted and they only work by email, or else they charge for the phone call time… and fair enough too! I would love a buck for every call I have fielded from dreamers, diviners and deadheads wasting my time and trying to pick my brains for free.

They clearly set out their terms and conditions and they work a week at a time, so scheduling is important or course. They promise to give quick and professional service and they make it clear they expect their clients to respond similarly. Rather than get stuck half way through a project with a flaky client and a niggling doubt as to whether they will get paid, these professionals set the terms and the tone right from the start. They are not after friends, they want clients. No doubt they develop solid relationships with their clients that are friendly as well as professional but the aim is to make a living, to run their business. I would presume they do their socialising elsewhere and keep work and play separate. Something many freelance eWriters, fighting the loneliness of the laptop, must keep in mind. Check them out. They crowdsource and they make very good money and they do it by being professional. A lesson and an inspiration for us all.

Leading By Example – Handling Crowdsourcing Job Bids

I use up my free dozen or so Elance credits every month, bidding for writing jobs that interest me and that are within the parameters of the niche I have decided to specialise in. I learned some years ago that to try and compete with a writer in Mumbai for article churning work is pointless. They can write for a buck an article and live off a few hundred dollars a month, I can’t. Rather than moan, I leave the churning stuff to my third world colleagues and narrow my focus.

One thing the clients usually ask for, regardless of what their budget is, is an example of your work. Aside from the various examples you post on Elance, serious clients will ask for a sample specific to their project.This happened to me today and it is something worth discussing here. First of all I had to listen to 7 minutes and 25 seconds of a Video narration. The client wants these Vlogs turned into an eBook and as one of the bidders, could I give them an example of how I would do it, using this first in a series of nearly 20 Vlogs as the framework. No problem, right? Maybe not.

Think about this for a moment. How much of my time should I spend doing this given the job is not even close to being mine. How much do you charge for the job if you do get it and let’s not forget the very real risk of undercharging either to secure the job or simply because the work takes much longer than anticipated from what you understood the initial brief to require. On a more cynical note, what if each of the bidders were sent a separate Vlog to do an example of and each would be told ‘thanks but not quite what we want’; only to find some weeks later an eBook for sale comprising your example and the examples of all the other ‘unsuccessful’ bidders. It does happen.

I decided I wanted the job and the worst  case scenario had me spending a couple of hours of my day writing and doing what I love, so why not? I transcribed the Vlog narration verbatim which took a little over an hour and then I rearranged blocks of that text and added some of my own content to create a new, fresh article that could become part of an eBook, just as the client wanted. All up, about two hours and about what I had had costed and worked out it would take me when I bid for the job. As the bids asked for an hourly rate I figured I could add value to the client’s project by offering a set rate per video, providing they were all around the same length. This would actually be cheaper for the client than using the crowdsource site’s hourly work software that ensures the client gets an hours work on their project for an hour’s pay.

I sent the client both the transcript and my article version. I asked them to respect my copyright on the article and if they didn’t give me the job, to either remunerate me for the article or not use it. Of course the transcript of the Vlog was theirs, gratis. I felt doing it this way showed them I was a professional who valued his time and effort but who was very clearly looking to add value to the client and have their best interests at heart. Setting a professional tone to the relationship right from the start is vital if you are to avoid being taken for granted and having the client expect you to write for free or put in extra hours for no extra pay. You can become bosom buddies later, at the beginning they need to know you can do the job and will do a great job but you are doing a job and therefore expect to be paid.

I’ll let you know if I got the job!

The Sydney Writer’s Centre is now known as the Australian Writer’s Centre. Well done Valerie Khoo and your team. I am not sure if this means they will increase course fees or not but they do offer a broad range of writing courses and their newsletter is always worth a skim. Two years ago I offered to discuss presenting my courses through their centre however at the time they felt there wasn’t much call for online writing courses, or getting people published. As far as I know they still don’t do much regarding electronic writing bar a few rather heftily priced workshops nor do they actually publish participant’s writing as I have done for six volumes now. But then I don’t charge enough for people to really value the course, I think.

There is much truth in the correlation between price and perceived worth or value. Too high and you scare people off but at least they think the course must be pure gold to cost that much. Too low a price and it is tossed in the same bin as the freebies. If it was worth doing it would cost more, many think. Of course knowing what the market will bear and what price point they will respect… well that’s the trade’s best kept secret.

I’ve never done a course at either the old Sydney Writer’s Centre or the new Australian Writer’s Centre but I am sure they offer quality instruction from very talented and well qualified instructors. Why not make some inquiries or at least surf on in to their web site.