A major concept that all new freelancers, independent contractors and small business owners need to understand is that of billable hours. The hourly wage that you may have once earned at a more traditional job is not equivalent to the hourly rate you should charge when you are in business for yourself. You must account for all the extra expenses you will incur — utilities, equipment, insurance, and so on — as well as the fact that you’re going to have a lot of non-billable hours too.

Making More Money, Working More Hours

Given this, if you have the goal of increasing your annual income as a freelance professional, you can go about achieving this goal one of two ways: You can either increase your number of billable hours or you can increase your hourly rate.

Since there are only so many hours in the day, there is only so much you can do with the former… and even then, most of us don’t strive to work 80-hour weeks if we can help it. And so, the preferred strategy is to increase how much you can earn per billable hour.

It’s positively critical to note here, however, that many of your clients and customers don’t even need to know that your effective hourly rate has changed. That’s because one of the best strategies you can employ is to improve your efficiency and this should be something that comes naturally as you gain more experience and get better at what you do.

Quantity and Quality

In my case as a freelance writer, the objective is to write quickly without sacrificing quality. This is one of the biggest reasons why I prefer to quote on a per-article or per-project basis rather than on a per-hour basis. It provides me with the motivation and encouragement to be more efficient (and more effective) in my writing.

Whether it takes me one hour or four hours to write a $100 article, I still earn the same $100. The difference is that by completing it in just 60 minutes, I have an effective hourly rate of $100. If I took four hours, the effective hourly rate shrinks to a far more modest $25. From the client’s point of view, so long as the quality of the article is up to snuff, he doesn’t care how long it takes me to write it. In fact, the sooner I can deliver, the better.

At the height of my time with Mobile Magazine back in the day, there were days where I’d publish as many as 15 blog posts in a span of about three or four hours. The posts were short, mostly in the 150 to 200 word range, but they got the information across in a clear and (hopefully) entertaining way. I wasn’t earning very much on a per-article basis; I made up for this deficit by writing as many as five posts an hour. I was a blog post factory.

Risks and Rewards

Even though I don’t really do that anymore, preferring to write more in-depth articles for a higher rate, a similar mindset still applies. Being such a prolific blogger early in my freelance writing career helped to hone many of the skills I continue to use today. It’s just not a strategy I would necessarily encourage in the long run, as it does leave you susceptible to burnout. But it is really effective in helping get your name “out there” and establishing your brand.