Counting Beans, Cutting Your Losses, and Not Being Seduced by Sexy Dollar Signs

This week I was reminded of a principle of freelancing that I don’t think I’ve fully touched on in any of my previous posts. I may have glossed over it in a list of things to remember or do, but it deserves a fair amount of attention, given that it can cost you valuable time and money. And maybe a trip to the shrink’s office. The lesson is about keeping track of your time and money, knowing when to cut your losses, and figuring out the details of a project you accept instead of being seduced by the curvaceous but selfish dollar sign. 

First let me tell you a story. This past week I have been working on a project that was originally estimated to be around $900 in earnings. Not bad for what I figured would be a day or two of work. The project was to expand an article already published by adding several more sections. Each article was to have about 2,000-4,000 words added to it, pay was $0.05 per word, and I earned 65%. Not bad. 

Within the first few hours of the project I started to realize that this little undertaking was going to require way more research than I had originally anticipated. But, since there was promise of a good pay day at the end, I figured it would be worth it. Nothing like some hard work and sleepless nights to put your month into the black faster, right? 

My first day I worked for 18 straight hours on this project. Even as I type right now my tailbone hurts. By the end of the day I realized that I wasn’t going to make the original deadline. But nobody had bothered to contact me or harass me (or answer a single one of my questions) all day. I thought this was strange since usually this particular team of editors and client reps is, ehm, passionate about getting things in on time. Nevertheless I thought I’d just keep working on it. I emailed them to let them know about the delay, and still heard nothing. I went to bed at 1 in the morning. 

By the second day, yesterday, I finally heard back about the deadline and found out that it was extended. Perfect! I continued to work on the project, but never heard back from my reps or editors about my questions. But I still kept plugging along. I’ll make this story shorter so you don’t have to go through the misery of reading every detail. At the end of the day, I was dealing with editors that wouldn’t respond, when they did respond they accused me of being “too wordy” even though I was right at the word count for the client, accused me of repeating information to “pad” my article even though it had 2 hours of research poured into it and after four readings I couldn’t find anything that repeated itself, still had more articles to type up, finally received a response to my original question that I had posed 36 hours previous, even though by that time it was moot, and had earned a whopping $80, which, even if everything else went swimmingly, would only be about $500 by the end of the project. If, of course, the client got around to purchasing what she ordered. 

Where I Went Wrong

Okay. So now that you get an idea of the kind of situation you can run into when you don’t heed the following advice, I’ll tell you exactly where I went wrong with this project. No matter how long you’ve been freelancing you will tend to make some of the same mistakes (or new ones), and that’s okay so long as you eventually figure out what you did wrong and learn from it. 

Here are the things I did wrong. 

  • I failed to keep track of the work that I was pouring into my project. 
  • I didn’t analyze my earnings along the way. 
  • I ignored warning signs that this might be a black hole project. (One that sucks you in, sucks your time, and sucks your money away only to leave you feeling drained and penniless.) 
  • I continued on with the project way past when I should have. 
  • I was following the promise of a big payout without really calculating what I would be earning by the end of it. 

Implementing the Lessons 

Here’s where you can learn a lesson from my mistakes. As the title of this blog post suggests you’re going to learn about counting your beans, cutting your losses, and holding your ground against those sexy and seductive dollar signs. Ready? Good. 

Counting Your Beans

Bean counting is an old term that is jokingly used to describe, usually, accountants. But all it basically means is to balance your budget, count your earnings, and do simple math to figure out what you’re earning. It is incredibly crucial that every time you take on a project you track your time. How long did it take you to research it? How long did it take you to outline it? How long did it take you to write it? How many hours are you spending per day on it? 

This becomes a little less important when you’re doing 15-minute articles for Yahoo! or working on a content mill. (Which I don’t suggest you make a career out of, because every day will be an 18-hour day.) But when you’re working on a big project or even just a long article – even if it’s an eBook you’re going to self publish and not for a “client”, per se – you need to keep track of these things. 

While I don’t suggest charging per hour (since as you get better and faster your hourly rate will earn you less and less), I do suggest that you keep a private tally of your earnings per hour. Why? Because if you find yourself earning less than the dude flipping burgers at the local fast food joint, it’s time to run. I am NOT saying there’s anything wrong with flipping burgers, but we are freelance writers, and our industry standard rate is way higher than that. Savvy? Good. 

Keeping track of your earnings is crucial. At the first sign that you’re losing money consistently or the project is no longer cost-effective, cut your losses and run. If you irritate some people in the process, that’s too bad. Don’t be rude or unprofessional about it – especially if you’re dealing with a corporate client or editor of a publication – but make a business decision to end the project and move on.  

You. Are. A. Business. I don’t know how many times I can say that. But somehow freelancers can spend years working as though they’re scraping pennies off the ground dropped by clients as they walk down the street. Don’t live like that. You are a business, you are a professional, you’re good at what you do, and you need to put food on the table. 

You need to see everything in light of a cost-benefit analysis. When the costs outweigh the benefits for too long, cut ties, part ways, and move on. It’s not personal, it’s just business. 

Cutting Your Losses

Speaking of cutting your losses, know how to do it with ease. Many freelancers get all touchy about the fact that a project didn’t work out, or a client was rude, or they fear hurting someone’s feelings. If you come to a point where you aren’t earning what you need to earn (and deserve) from a project, you shouldn’t worry about cutting your losses and leaving. 

I have bailed on several project from the same group of editors (not publication editors, but editors at a content curation company) and they still invite me to projects, I’m still a writer there, and I still earn a good living there. I’ve never once had someone throw a fit or cry or say I hurt their feelings by leaving when it was no longer cost effective for me to stay. 

And you know what? If they did, that’s not the kind of people I want to work with. Some people want to believe that they are special snowflakes and nobody should ever want to leave their projects or not work with them. What say I to these people? I’ll take overly sensitive for $400, Alex. 

Business is business. That’s not to say you should be rude – everyone deserves respect. But if you tell the person you’re working with “You know, I think I’m going to have to bow out of this project. I’ve enjoyed working on it, but it is not longer cost effective for me to continue,” nobody is going to be able to have a fit over it. Mmkay? Good. 

Resisting the Siren of the Sexy Dollar Sign

Dollar signs are like sirens. (No, not the kind on ambulances, the creatures of Homer’s imagination. Go read the Odyssey if you don’t know. It’s a good time.) They sing to you, oh how wonderful it will be to make $900 or $1,000 or $2,000. Think of how much better your month will be. How much less work you’ll have to do. Oh how fortunate are you to come across this project. 

I hate to kill the mood, but that happy floating feeling you feel looking at the promise of a big pay day will soon be replaced by weeping, moaning, and gnashing of teeth if you don’t pay attention to the details. 

Here’s another allegorical example. The project I told you about at the beginning? Not only would the sum total have been $500 or less (if you think I’m complaining about nothing, divide that by 38 hours), but I discovered that had I been taking the low-paying $6 and $7 articles I turned my nose at for that amount of time working that hard, I would have made over $560….a day. A day. 

Get your calculator. I’ll wait. 

Okay. Let’s say someone says they want you to write a white paper for them and they’ll pay you $1,500 to do it. Great, right? They just want it to be about 20 pages long, go over some complex data about their business, present it in a way that is digestable for the general public, and you’re done. 

You can easily end up earning less than minimum wage with this gig if you don’t do research ahead of time and plug your ears to the siren call of the dollar sign attached to it. 

You don’t have to do much research to Google “how long does it take to write a white paper”. But I’ll save you the time, because I already did it. 

It takes anywhere between 24 and 50 hours to write a white paper. If you’re really fast because you’ve done this several times before, then you may be looking at a 24 to 30 hour project. If you’ve never done it before, about 40-50 hours. 

For a fast writer, $1,500 over 24 hours is about $62 per hour. $62.50 to be exact. That’s not bad, but for freelance writers – particularly for this kind of work – it’s a little low. According to the Writer’s Market and their 2014 “What Should I Charge?” report, the average hourly rate for white paper writing is $82 an hour. Ouch. 

Now let’s say this is your first time writing a white paper. But you still work pretty quickly. We’ll say 40 hours. You’re down to $37.50 per hour. 

There’s a reason that the average cost per project of a white paper is $4,927. In fact, even the low end of white paper writing is $2,500 per project. 

If you didn’t take the time to research that, you wouldn’t know. And you might jump all over this project like white on rice because of the $1,500 price tag. But you really have to figure out what the price tag involves and what you really end up making by the end of it. Even the largest looking price tag can end up bankrupting your month if you’re not careful. 

Think by the Hour, Charge by the Project

A simple way to go about it is to think by the hour but charge by the project. In other words, if someone says “Hey, I hear you’re a writer and I want you to write weekly blog posts of 500 words for my company’s blog,” you should think “It takes me about an hour to do a well researched and well written post of that length, and I’d like to earn about $65 per hour for that kind of writing.” But you should say, “My going rate for that kind of work is $70 per post.” Thinking by the hour allows you to make what you need to make so you’re not working 20 hour days 7 days a week and barely putting a roof over your head. But charging by the project allows you to round up a bit to account for delays, and you can also increase your price based on the project. 

There’s a reason the Writer’s Market doesn’t have one flat fee estimate for writing. Your rate should change depend on what type of client you’re writing for, what you’re writing, and even the industry you’re writing in. If you quote a flat hourly rate you’re losing thousands of dollars per year. If you quote per project on a customized basis you can earn what you need to earn. And if someone says it’s too expensive, never feel bad about turning it down. You need to make room in your schedule for clients that will help you work a reasonable amount of hours and earn a comfortable living. 

Hopefully this has helped you out. I hope to be back much sooner than last time with a new blog post for you guys. 🙂 

Happy writing, and have a great day!

 

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