Figuring out how to get paid as a virtual assistant can be a challenge for most. Before you can decide how to get paid, however, you’ll want to understand how to set your rates. You’re going to want to make sure your rates are right for getting clients but fair to you.
As service providers, you’re often trading hours for dollars which means you can be limited by how many billable hours you can work. The good news is that there’re ways to set up your fees so that you’re earning a good wage no matter how quickly you work.
How Much Do You Need to Earn?
Decide how much you need to earn each month to satisfy your expenses, household needs, and lifestyle plans.
If you want to make 5K a month, you must realize that as a service provider, it’s not likely you can really work 40 billable hours a week. A lot of VAs expect that they’ll work a 40-hour week, and so they end up setting their fees too low.
You want to keep in mind that you’ll be doing work that won’t be billable, such as working on your own blog, sending pitches, and such.
Also understand that you’re responsible for paying self-employment taxes, for software, equipment and more. These expenses can add up. Figure out what your break-even point is by adding up all your costs.
Then, add in the minimum amount of money that you need to earn, plus expenses to keep a roof over your head, eat, and pay for health insurance and other costs. On top of that, add in the lifestyle choices you want to be able to make such as vacations, travel, a bigger home, a better car and so on.
If you’ve decided $50K a year is what you need, and that you can work 20 billable hours a week for 50 weeks a year with a two-week vacation (1000 billable hours), that means you’ll need to earn about $50 an hour.
This may seem high, but if you’re specializing in a high-demand niche, this is completely doable even as a new VA.
That being said, your clients might be wary when you approach them with the 50 dollars an hour reality! This is where package rates are helpful.
Setting Your Rates
Once you know how much you need to earn per hour on average and how many billable hours you’ll need to put in each week, you can start to set up packages for the services you want to offer.
The best way to set up packages is to look at what your ideal clients need and set up sample package ideas. Then, create specialized packages for them after your discovery call.
Here’s an example of a package for an Instagram Specialist VA
- Post 30 graphics each month at one per day
- Create 30 graphics to post each month based on quotes you choose & your images
- Link to your site (a blog post, a product, or affiliate product in each)
- Price: $250 Monthly
- If I choose the quotes and images: Add $100.00
Naturally, your pricing might be different. This package is based on the VA believing it will take her about 5 hours a month to complete the package. With the add-ons, she thinks it will take her another two hours plus the price of images to complete the package.
Take the services that you know how to do, want to do, and can estimate a time for. Create a package as an example.
Then, when you talk to the client and you realize they want five posts a day on Twitter, 5 posts a day on Facebook, and five on Instagram, you can make a specialized package for them in your proposal.
You’ll need to estimate how long it will take you based on exactly what they want you to do, plus your expenses.
When adding fees for images or anything you must outsource. it’s common to mark that up by 1.5 times. So, for example, if you outsource image creation to a graphic designer, you’ll want to know how much they are going to charge you.
You’ll then multiply that charge by 1.5 and pass that on to your client in the bid. This is something you need to work out with a graphic designer (or any service provider) you plan to work with before you price any packages for your clients.
In your proposal, be very clear about how much editing will be included. In general, if your client doesn’t want to give a lot of direction, minimal editing should be allowed. You should add in the time you think you’ll spend on editing.
Even if you don’t do that much editing, that’s okay when creating packages. Some clients will use up every opportunity to edit and others will accept your work as is. But, you want to account for it just the same.
Okay, now we want to talk about the fun stuff; how will you get paid? PayPal is a popular choice these days as most people have a PayPal account. PayPal Business also has an excellent invoicing solution included that you can make look very professional with your logo, as well as a variety of templates.
Here are some other options:
- FreshBooks.com – This is not just an invoicing solution. FreshBooks can also help you handle projects, which is a great idea if you’re going to be managing other people. You can set it up so that each contractor can input their work and that way, invoicing is very simple with just a few clicks.
- Zoho.com – This application has many features, one of which is invoicing. Zoho comes with many additional features like time tracking, customizable templates, support for more than one currency, and more.
- QuickBooks.com – There are many different types of invoicing solutions included with QuickBooks. You can manage entire projects with contractors and more with this software. However, it has a higher learning curve than some of the others.
Set Up Your Systems
Your success as a VA will depend on the systems you set up, so you’ll want to set up a system for invoicing your clients.
You can invoice them before or after you do the job. You can also set up a graduated payment model where they pay half up front, then measured payments until the project is completed.
It’s important to know how you plan to handle billing before you choose an accounting system. Be sure to put these details in your contracts or follow-up consultation emails.
My post about Client Getting Tips and Templates for Service Providers will provide more information on the client onboarding process.
If you’d like help sending business emails to clients, sign up here to download my Client-Getting Email Templates.