How much SHOULD you be charging?
FANTASTIC QUESTION. I’ve put this post on the back-burner far too many times – despite this being the number one question I get asked by new VAs. I’ve definitely answered this in many livestreams, but finally I have decided to put all my thoughts and advice on this topic in one place for everyone.
Setting your rates as a VA can be super confusing and often will bring up a lot of limiting beliefs like ….’I don’t deserve that much’….or ‘people won’t pay me that much’ and before I go any further, YES YOU DO, AND YES THEY WILL. I would not be writing about nor teaching about the VA career if those beliefs were true.
So limiting beliefs aside, how much should you be charging? Well, it depends. However, based on my extensive interactions with new VAs, and personal experience, you should probably aim higher than the amount you have planted in your head right now. Most people, especially women and even more so members of marginalized groups will charge less than they should. A lot of this is down to mindset-blocks – see more here – but in this blog post I want to address some cold hard numbers for how you can reach your ideal price point as a new VA. The following formula is applicable to the hourly pricing model.
The Formula: EXPENSES/HOURS
There are a few factors to consider, namely your expenses. You didn’t quit your job to struggle or live under the bread line – so make sure you’re AT LEAST meeting your expenses. You may not meet them with 1, or even 2 or 3 clients, you may have a few clients that help you do so – but this formula can help you get an indication of where to start when charging hourly.
TASK STOP! ✋
- So I want you to take a moment to jot down all your ongoing business expenses. These are things like, digital subscriptions and tools, hardware, software, coaching, education (like the VA Starter Kit) and so on…
- Next I want you to jot down all your monthly living expenses. Rent, utilities, childcare, student loans (BIG ONE! You studied to work, your work should now pay for your studies), groceries, insurances, etc.
- Add up the total of both lists. Let’s say the total is: $2200.
- Tack on 10-15% for unexpected bills, up-charges etc. This brings us to: $2530.
- Then tack on 25% for leisure, clothes, trips to the movies, dates, you know, the stuff that allows you to live a fruitful life. This brings us to $3162.
- Tack on 25-35% for tax. If you know exactly how much tax you have to pay in your country/area – you can get more accurate here.
- This brings us to a total of $4269. Keep this number safe.
- How many days are you committed to working each month? Let’s say it’s 20.
- How many hours are you committed to working each day? Let’s say it’s 6.
- How many hours is that per month? That’s 120.
- Your formula would be: expenses/hours. In this scenario: 4269/120 = 35.5.
This would indicate an hourly rate of $35.
The great news? You’ll have a fair bit more take-home from that than you expect, you can deduct a lot, if not all of your business expenses. Even more so if you’re in the design field, a lot of entertainment can be considered deductible too.
Regardless of the formula suggested – I always tell new VAs to start at a MINIMUM of $20 per hour. So if your expenses/hours calculation brings you under $20 – then raise your rate to $20-25. Why? Because regardless of where you live in this world, you are providing expert services, not cleaning toilets, and you deserve well above minimum wage. It’s also your duty to raise the industry standards when we live in a world where there is more slavery than ever before recorded.
Side note for those hiring VAs and for interested VAs (can we make this go viral?!) 😉.
Now of course, the rate you come to will be highly dependent on your personal situation, if you still maintain another job and whether you have general entry point skills or super skilled specializations under your belt. If you have very specific advanced skills that you’re bringing to the table, you’ll want to keep the below in mind when setting your rates. Generally speaking:
- General skills like admin, calendar management, social media posting and simple canva design would be charging around $20-30ph (per hour).
- VAs with intermediate skills in a few more advanced areas like WordPress maintenance, blog writing, graphic design would be charging $30-50ph.
- Specialized VAs who do things like managing advanced web development projects, SEO, funnel building/strategy, FB ads, can start from around $50+. I know VAs who have started out at $50 and ended up at $350 per hour of consulting on FB ads and social media strategy.
What do I recommend to new Virtual Assistants?
There will be times where you’ll get on a call with a prospect and you’ll just mutually fall in love. Sometimes the client will say outright that they want to hire you on a retainer and that makes the sales process much easier on you. However, more often than not you’ll have to work on your power of persuasion by showing them the value you can bring to their business and life.
The best solution I have found to do this is to build a bridge between hourly and retainer pricing. Offering clients a paid trial period of 5 VA hours. This is a low-cost, low-risk investment for a new client to take, making it easier for them to give your services a try. Make sure you charge up-front for the 5 hours. During those 5 hours of work, your goal is to wow them into submission aka make them happy, be a great listener and communicator and do a great job. At which point you can much more easily prove to them how much fun it is going to be working with someone like you and to move that conversation on a retainer agreement quicker.
NOTES AND ADDITIONAL TIPS:
Raise your rates $2-5 at a time every 4-6 months as you pick up new skills and get more efficient at what you do. You can choose to honor your existing rates with some clients or gradually make even more incremental increases as you go, with open communication at all times.
Get really comfortable saying your rate out loud. If it doesn’t feel good when you do, ask yourself a) is it because I’m lowballing and I KNOW this is gonna suck? or b) is this feeling too high for where I’m at? – if it’s the latter you must establish if this is really the case, our brains make a habit of keeping us playing small. Either way, don’t be afraid to face the feelings head-on and examine them thoroughly, like I said, above all else, YOU need to feel comfortable saying your rates out loud.