Hourly jobs can make you money — if you handle them with care

Teacher: David Perlstein

In my last column, I advised — strongly — that you charge by the project rather than by the hour.

There are times, though, when it makes more sense to charge by the hour.

Usually, this is true for what I consider “mechanical” tasks. For me as a copywriter, these are open-ended jobs that generally involve editing and revising rather than conceptualizing and problem solving.

When you decide it’s better to charge an hourly rate, you might want to follow these basic guidelines to protect yourself:

Don’t overreach. Your experience, not your ego, will help you find your market value. Start with a minimum rate that will let you meet your financial needs. Over time, you’ll be able to raise it.

Set a consistent rate. Avoid quoting different rates to different clients for different projects. You risk confusing yourself and angering your clients if they find out.

Get it in writing. The last thing a free agent ever wants to hear is, “You charged me how much an hour?” Keep a paper — or email — trail to support your position if a client ever questions your invoice.

Flag your client. Hourly jobs may often be open-ended, but client budgets are not. Report your progress periodically in writing. If you estimated a job would take 20 to 25 hours, report your progress at the 10-hour mark and every five hours after that.

Your client will want to be told about how long it will actually take to do the job and what it will really cost. And you’ll want those notices to document your position in case there’s a dispute.

Once you get started, you’ll need to keep accurate records. Here are some tips:

• Create a standard time sheet: Record the day, date and time periods during which you work. Keep a running total of your hours so you can track the job instantly.
• Divide each hour into workable billing units: I keep time in quarter-hour units. Any work time beyond 15 minutes accrues as another quarter-hour. If I work from 3 to 4:05 p.m., I’ve accumulated 1.25 billable hours. Include those three-minute stretch or water breaks, too. No one can function without them.
• Charge for travel and meetings: Travel to a meeting or research site, and you’re working for your client. The same holds true when you’re commuting to work on-site. (My personal rule is to charge for trips longer than 30 minutes from my home or office.)
• Add out-of-pocket expenses. Include these in your invoice under a separate category.

Hourly jobs are not the most profitable, but they can definitely add to your bottom line if you handle them right. Open communication with your client and thorough record keeping can make them work.

About the teacher:
David Perlstein has been a freelance advertising copywriter in San Francisco since 1979. He is the author of Solo Success: 100 Tips for Becoming a $100,000-a-Year Freelancer, Crown Publishers, New York.