Why Many Freelancers are Underpaid? Is it Lack of Respect?

11/12/2016 12 comments

If you plan on working as a freelancer, you probably heard some nice stories about how you can work from anywhere, any time you choose and for a very nice pay. But once you start actually start freelancing and find some clients (check out one of my earlier posts on how to land your first client), reality hits you in the head. Still, the sad reality is that many freelancers are underpaid, especially new ones.

The pay is nowhere near what you they said it would be! Where are the $5k+ projects? Where are $50 500-word blog posts? Instead, what you get are low-paid articles for which you are happy if you get $5.

Is this your freelancing reality? Should you be  satisfied at being on the lower end when it comes to payments just because you’re working as a freelance writer or designer?

Of course not, but why is this happening in the first place?

Here are 7 most common reasons why many freelancers are underpaid:

1. Freelancers Often Give Clients the Upper Hand

I can’t tell you how many projects I declined for just one thing. The client wasn’t willing to negotiate his price at all. He just set a certain price and said “if you don’t like it leave it”. So, I left it.

Maybe some of these prices were okay, but you have to be able to negotiate your own price. Bargaining is a vital part of getting a new project when you’re a freelancer. Sure, you won’t get from $5 to $50 for an article, but you can at least increase the rate by a few dollars.

On the other hand, you need to be flexible as well. Just as the client’s price shouldn’t be set in stone, so your’s shouldn’t be either. Believe me, the best projects are those where both you and your client are on the same page from the get go.

2. Freelancers are Afraid to Lose Clients

This is absolutely the freelancer’s fault. Many fear they will lose a client in they quote too high and so they lower their rate and even undercharge. And what does the client do in this situation? What anyone would do, he accepts the offer with a big grin. He just saved himself some money on your mistake!

Now I know what you’re thinking. “But I’m new to freelancing. No one will pay me what I want, so I have to charge less!”. To you, I say. You’re wrong! Being a new freelancer is no excuse for this. If you’re afraid of losing a client offer to do a free sample article. Let them see how you write and decide whether they should hire you on your quality and not price. Remember, getting a freelance gig is not all about who’s cheaper.

3. Freelancers are Doing Much More Than Write Content or Design a Website

Freelancers don't just freelance

What many clients don’t realize (and many freelancers as well) is that a freelance writer is not just a writer. He is also the researcher, editor, proofreader, his own accountant, IT guy, secretary, and much more. A lot of these “side tasks” you can’t get paid for, but they’re still essential in freelancer’s work.

The same goes for freelance web designers or developers. They too, have to deal with countless other things aside from their actual work.

I’m afraid there’s not much you can do about this except look at what you’ve earned each month and if you’re barely paying your bills, increase your rate for the next client.

4. Freelancers are  too Forgiving When it Comes to Late Payments

Sure, you’ll not always be paid on time. That is one of the biggest caveats of the freelancing profession. But that doesn’t mean you should give the client an idea that you’re okay with this happening all the time.

I once had a client who was constantly late with paying me. What I did was first politely remind them that they owe me some money for the last month. That usually worked. However, at some point, we stopped working together. The problem was they had a month-and-a-half of work left to pay me. Did I give up on this money? Of course not! I sent them Upwork messages, emails, Skype’d them every couple of days, until they finally paid me, and apologized to me for waiting. I accepted both happily.

5. You Still Think of Yourself as an Entry-Level Freelancer

Naturally, there’s a difference in how much an entry-level freelancer is paid and how much someone who’s already and expert in the field can ask. The problem is that a lot of freelancers keep underestimating themselves and continue to quote on entry-level jobs, even though they’ve outgrown them.

You’re really only a beginner for the first few months if even that long. After that, you’ve already earned enough experience to ask for more money. And if you’re in this for 5 or more years, you’re likely already an expert freelancer, so there is no need to even look at those $5 jobs anymore.

6. Some Freelancers Misjudge the Project

This often happens because of the poor communication between the freelancer and the client. Usually, it goes a little like this:

  1. The client posts a job, saying he needs 5 articles done
  2. The freelancer applies for it, quoting a certain price
  3. The client takes a look at the resume, cover letter and maybe some samples and sends the job freelancer’s way.
  4. The freelancer realizes there’s much more to the assignment than the client originally said.

This is why you should never accept a job without fully knowing what it entails. Are you only doing writing, or do you also have to do the editing, proofreading, image editing, SEO, keyword research, link-building and more? To avoid this situation, make sure to get the full details of the project from the client before you start it.

7. Freelancers Sometimes Quote Less Because of the Competition

Let’s go back to Upwork for a moment. Tell me, how many times have you quoted less than your regular rate on a project, because the competition was also quoting low? Was the project really worth losing money?

I will assume it wasn’t. There are enough good-paying projects, even on Upwork, that you don’t have to look at your competition so much. Does Rolex sell their watches for $50 because another watchmaker does? Of course not, because their watches are of higher quality and they have a good reputation behind them. The same goes for freelancers. Just quote what you think you are worth and if they client contacts you, you can always negotiate a little.

Getting a project will often feel like you’re in a race. And just like in a race you shouldn’t slow yourself down because the competition is slow, you also shouldn’t quote less because the competition does the same.

Final Thoughts

It’s different for every freelancer. Some have more experience, some are better at negotiating, others plan their expenses better. But if you want to avoid getting underpaid as a freelancer, it’s time to stop doing these seven things mentioned here. Because otherwise, you’ll end up here. You want to be this guy.

Found yourself somewhere in this article? Do you know any other reasons why many freelancers are underpaid? Do you want to learn more about being a freelancer? Then don’t forget to like the post and follow my blog.