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How little or how much? The problem with value

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A little story: My son is at art school here in Shrewsbury, where they’ve recently had their end-of-year exhibition. During the event, he managed to get a commission and a sale. When asked for a price, he froze for a few seconds and then blurted, wide-eyed and breathless, “I don’t know!”. 

Should art schools at least touch on how to charge for work? Would an early introduction to the value of work help avoid those ‘oh sh*t’ moments?

So how should you set your fees?

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For most of us right now, the subject of money is at the forefront of our minds. The cost of living, particularly things like food and fuel, has increased dramatically and continues to do so, and I’m sure, like me, this has brought up the subject of how much we earn as designers and whether or not we’re setting it right!

You might be just starting your career or be years into it – in my experience, it makes no difference. I sometimes still feel awkward whenever I’m asked about my fees. We’re not really taught this stuff, are we? There are no set-in-stone guidelines, no magic formula to tell us what to charge for X or Y. We’re left to work all that out for ourselves.

These days though, I have found a way to work out the rate that suits me. It took a while, in the beginning, to settle into a rate that I was both comfortable telling people and happy that it was enough for me to live on.

In case you are still in panic mode about what fees you should be charging for your work, I thought it might be useful to share some of my insights and thoughts around it.

The great money taboo

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We’ve been conditioned not to talk about some subjects, and money is one of the big ones. The trouble is, by keeping hush-hush about what we earn, how we earn it, and how we treat it, we’ve created a world where we’re afraid of it – it’s something we feel that is out of our control. But it really shouldn’t be like that.

Even now, I’m sometimes guilty of brushing the subject of money aside when I’m asked about costs for projects when I’m talking to clients – it’s so easy to brush it aside when you’re asked ‘how much?’, by saying something like, ‘we’ll work that out later’. It feels shameful, embarrassing, to talk about money – especially when someone is sitting right in front of you.

Money, and how we earn it, is something that we can all relate to – it’s not something we should be embarrassed about. But perhaps if we can get over that and become more confident around our handling of money, we can change that. To do that, we need to start communicating. And that starts with knowing your rate and having the confidence to stick to it.

What’s the ‘going rate’?

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Out of interest, I searched around the internet for advice on what a graphic designer should charge. The thing that stood out was how much the advice varied – if someone just starting out was to search for information on what to charge, they’d surely come away more confused than ever. It was pretty eye-opening.

My advice would be to talk to other established designers doing similar work to you. Most of them are more than willing to help with their advice and experience and won’t mind sharing their knowledge. Ask them if they think you’re undercharging and what they believe would be a decent rate for the type of work you want to offer or the amount of experience you have.

If you can get a ballpoint figure, you can use this to work out what YOU feel comfortable charging.

What do you want to earn?

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Notice I didn’t say ‘need’. There’s a difference between what a person needs to earn and what he wants to earn. Let me give you an example.

Perhaps you have a mortgage of, say, £1,200 per month. And your bills/expenses equate to £1,500. So you could say that what you NEED to earn is £2,700. Yeah, that’ll cover your bills – but what about the other stuff? You didn’t start this career to just manage, did you? You want to have the ability to afford a holiday, a decent car, and perhaps indulge in your hobbies.

Again, research what other designers in your demographic and area are charging and work out if that meets your desired annual salary.

There’s a formula out there that has popped up in a few places that may be useful as a starting point, and that is roughly as follows:

  1. Work out what your ideal yearly salary should be.
  2. Add 30% to account for sick days and holidays.
  3. Divide it by the number of days you’ll work in a year.
  4. The number you get equates to your ideal day rate (you can work out your hourly rate from that).

Final thoughts

I suppose my main point through this article is that getting the foundations of your fees right and being confident in telling people what they are, is one of the most important decisions you will make for your business.

Setting fees is never easy, but it’s definitely worth getting it right early on.

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