How I earned $150K last year from freelance design
Let’s talk about earning more money as a freelancer. I go in-depth into everything I’ve learned from nearly two decades of design & business.
This is a follow-up to my popular post How I earned $15,000 last month from freelance design, in which I’ll cover more detail about how to sustain high freelance design earnings. You may wish to read that story first for context, as it lays the foundation I will build upon here.
How I earned $15,000 last month from freelance design
Hint: there’s no shortcut. I’ve been working at this for 17 years.
I’m not bragging. I don’t want your high-fives. This isn’t a get rich quick story, or a listicle of shortcuts to freelance business success. I’m not advocating startup “hustle” or inspirational productivity “hacks”.
I simply want to share what I’ve learned over nearly 18 years working hard to grow my solo design business. I didn’t have any business mentors. Most of this I learned through trial and error, or my gut instinct for common sense.
I believe too few people are bold enough to openly discuss money with their peers. If our career goal is to align our strengths and passions with ways to earn a comfortable living, we can’t ignore the second half of that equation because it’s somehow become culturally taboo.
So let’s be frank. Spill it all out in the open. Here are some trends I’ve witnessed over my freelance design career that have contributed to my business success. I hope they resonate with your experience, and you can take at least one valuable lesson to apply to your own endeavours.
Over the last 365 days I’ve billed my clients for NZ$154,909.03 in freelance digital design work (roughly $106K in USD). This includes the notoriously slow Dec-Jan New Zealand summer holiday period, when most of the country shuts down to go to the beach.
I just pulled the report from Xero. I couldn’t believe it. I knew these past 12 months were my most lucrative to date, but didn’t grasp quite how much. This is a nearly 25% increase on what I earned over the same period last year. It doesn’t feel like I worked 25% longer or harder, so there must be something else going on.
I’ve previously highlighted how to build the foundation for freelance success through:
- Building a strong reputation
- Charging high rates
- Embracing long, complex jobs, and
- Using your time efficiently
Reflecting on this successful year, I’ve uncovered some deeper patterns I’d like to share. These are things that help sustain freelance earnings for not just one good month, but many months or years on end.
Diversify client types and project sources
In order to earn good money as a freelancer, you need to stay busy. For most of us who still charge hourly (more on this later), every hour not working is less money earned. A constant stream of new work is required to maximise your earning potential.
As I sit here writing this, I’m suffering through a slow patch of work. One of my projects meant to start last week has been delayed. It’s too small a gap in my schedule to take on another significant project, so I’m spending more time writing but feeling the guilt and anxiety of not earning. Even for the most experienced of us, these scheduling hiccups can’t be avoided. But there are ways you can minimise them.
Scanning through a list of all the clients I’ve worked with over the past 12 months, there’s one thing that jumps out at me. They are all different.
I haven’t niched down on a specific industry, or too narrow a type of interface design work. This allows me to pull potential work from a wide array of sources. I like this because it gives me more creative variety, but also because I have more pipelines for acquiring new projects.
I’m anti-niche when it comes to limiting my skillset, client pool, or design style. Some may think that counters prevailing advice around the importance of niche, but in my experience it’s been an asset, not a limitation.
I work with all four of these client types:
1. Small businesses
I work directly with small business as a turnkey branding/design/dev provider. This includes things like brochure sites, portfolios, ecommerce design, etc. These are the business you generally do everything for, so it’s great to have a broad range of design skills to cater to any needs that may arise.
I don’t mean you should be a jack of all trades, master of none. I mean be a T shaped professional. One or two verticals of deep specialisation, and then a broad range of supporting skills that add to your flexibility. This skilled generalist designer offer the most value to small business, as they don’t have the resources to coordinate a team of narrow specialists to cover all their design needs.
2. Startups & young tech companies
I work with startups to conceptualise and design branding, web or mobile apps, and their supporting marketing websites and other communication.
It’s very frequent for startups to have founders with development or business backgrounds, but not a design founder. Yet they know they need a design-led approach to product development. They haven’t yet grown to the size where they have internal product design teams, but they can’t afford not to have top-notch design. That’s where I come in.
They key here is to work with startups that are already somewhat established and funded. Working for bootstrapped garage startups means cost-clients, which are not fun or profitable to work with. When they offer stock options as payment instead of money, it’s usually time to head for the exit.
3. Medium sized businesses & organisations
I work with medium sized organisations of all types as a remote but integrated part of their team. A specialist UX/UI designer to strategise and execute product design where their internal skills are lacking (they often have just development in-house, if even that).
These clients generally know what they want and need, but also have the nous to hire an experienced pro and then fully trust the expertise of that designer. If you have the communication skills and business acumen to fit into this situation, they can be highly rewarding projects.
4. Design agencies & dev shops
I work with web dev shops or design agencies who outsource design work. Maybe they don’t have enough design work for a full-time role, so they outsource it to freelancers until their demand grows. Or they just lost a designer and are short on capacity to handle their workload. Maybe their design talent is junior level and they need an experienced UX person to steer a high-profile project. Freelance designers are a great assets to cover all of those shortcomings. You’d be surprised at how many big design agencies still haven’t fully skilled up on digital/web/mobile — there’s plenty of potential for digital-native experts to add value.
These main-contractor clients manage most of the end-client communication and project management for you, which allows more focus on the craft of design. But the projects come at a cost of slightly less control over the outcome, and an intermediary client adding more levels of feedback to the process.
Every agency will have its own preferred project management styles, design processes, and communication standard, so you have to be flexible to fit in and learn new things. However, I’ve gotten a great deal of work through arrangements like this, which also tend to turn into fruitful long-term relationships, once you earn their trust. I once contracted for a web development company for over 8 consecutive years.
The only downside of subcontracting for agencies is that you often have to work for a slightly lower rate than you’d charge when working directly with your own clients, as the agency needs to make a markup on your time to cover admin and project management.
Hint: if you charge them the same amount as your other clients and they don’t complain, you’re probably charging all of your other clients too little.
What I learned:
Finding your design niche has it’s place for some, especially if you’re failing to prove your value and stand out in a busy market. But broadening your skillset and widening your potential client pool is an equally valid path towards professional freelance success. The more sources of work you have, the better chance you have of keeping a full schedule of new and interesting projects.
It all comes down to your mix of strengths and experience, and what client types you can provide the most value to. If you can demonstrate how you add value to their business, don’t niche them out, or you’re missing potential opportunities.
Leverage reputation and referrals, so clients come to you
I rarely have to compete with other designers for jobs anymore. It’s uncommon to find myself in a position where my proposal is being compared against other freelancers or agencies, all hoping to earn the same design project. I don’t know exactly when this happened. Over time it simply slid away.
I do know why it’s happened, and it’s the #1 key to making freelance life easy.
Reputation leads to trust. Satisfied clients lead to referrals. Referral clients come to you preloaded with trust, because they’ve already got a sniff of your solid reputation. This reputation–trust–referral cycle is the secret.
Clients who come to you by way or your reputation — or through a referral — are often already sold on using you for a job. They’re not playing the field to compare what’s out there and find the best value. They’ve already bet on you as the winner, now all you have to do it live up to the expectations your reputation has set.
As an added benefit, they also come to you free of any marketing cost. I spend almost no time or money advertising my services anywhere.
When you find yourself in this situation, a few interesting things happen:
- Your pricing becomes less important. Instead of worrying how your price might compare to others (like a commodity), you only have to worry about how it fits in your client’s budget. If it’s within their range, you win the job. Talk of pricing becomes a secondary formality, rather than the lead question. This also allows you the opportunity to transition clients into alternative pricing methods (more below).
- Your expertise is more respected. You’re seen as an equal partner, because you’ve demonstrated a genuine interest in, and aptitude for your client’s success. Clients trust your experience because they’ve seen or heard what you’ve done for others. Design discussions have less ego and more constructive critique, because both parties have a mutual respect for each other’s process and interests.
- Projects run smoother. You need to spend less time communicating expectations and building trust, which means more time for thoughtful design work and innovative thinking. Everyone enjoys the process and contributes appropriately, because they have full confidence in each other’s role in the project.
Anyone who’s experienced a surge in referral clients will know their value. The big question becomes: how do I get more referrals? I’ve written on this before:
Get more freelance clients by becoming “referable”
Referrals are the holy grail of freelance client acquisition. But they don’t come automatically, even for many experienced consultants. So, how do you get more referrals?
The other half of the equation is building a reputation.
That one’s easier said than done. Part of the process is simply experience, which means it takes time — and a number of successful projects over years — before you start to feel that reputation grow.
But the length and breadth of your experience doesn’t mean a thing if you’re not providing extreme professionalism, and high quality work. Positive reputation only builds from exceeding expectations. Those expectations include how well you practice your design craft, but of equal (or more!) importance are the “soft skills” of running a reliable business.
Have you ever wondered why someone seemingly less talented than you has more success?
One reason is effort. Lack of talent can be overcome by extra effort (Performance = Talent x Effort²). But more than that, it’s because they‘re excelling in less visible areas. They might be beating you at:
- Client communication and setting expectations
- Organisation, time management, and meeting deadlines
- Marketing, outreach, networking.
Think back to anyone you’ve hired over the past few years. An electrician or plumber to fix something in your house. An accountant or lawyer to help you run your business. What do you remember about them?
I remember which ones were nice and easy to work with, vs. which ones were abrupt and disinterested. I remember which ones were reliable, not flakey. I hardly recall if one did a slightly better job than the other. I care about which one I would want back in my house (or my business) if I needed them again.
Do you see the value of soft skills now?
The bitterness of poor quality remains long after the sweetness of low price is forgotten.
— Benjamin Franklin
Quality refers to product or service, but equally experience. Build reputation by offering both high quality work, and top-notch customer experience. Blow them away with professionalism and your higher prices will be gladly accepted.
My takeaway lesson
Building reputation and generating referral clients may seem like abstract things that just happens to you over time as you gain more experience. However, you have more control over them than you think.
The way you interact with each and every one of your clients builds layer upon layer of your reputation. It pays to structure processes in your design business that actively grow your reputation and encourage referrals. They are far from beyond your control. Put in the effort to make them a priority and you’ll reap the rewards tenfold.
Increase your value by providing Quick Qualityᵀᴹ
What makes a designer more valuable? Worth more money? This is something I contemplate frequently, because it’s to vital to earning more as a freelance designer.
I get praised by clients for working quickly. They can’t believe how fast I turn around design revisions, or conceptualise new solutions to a sticky design problem.
When I reflect on these projects I don’t feel like I rushed through anything. I’m not incentivised to work fast by sacrificing quality. In fact, quite the opposite. I’d choose slower quality over fast mediocrity every day, and I only align with clients who feel the same way.
So I never decrease quality, yet seem to get things done faster than my clients expect (and sometimes even faster than I expect!). Why is this?
A small part of it is knowing the right tools. Years ago I switched from Photoshop to Sketch, and the speed of my interface design work has skyrocketed ever since. I use Cushion to help manage scheduling, Trello to organise project tasks, and InVision to discuss design feedback. It’s a workflow that’s very efficient, meaning less time managing the project and more time hands-on with the design work.
Yet everyone has access to those tools and none of them are difficult to learn. They are necessities, but using the right tools provide only minuscule creative advantage. A good designer is a good designer, no matter what software they prefer.
As I discuss in Fast design vs. quick design, the real differentiator in design output is how quickly you arrive at the best design solutions. How much experimentation you require to uncover them, and what you need to validate them. Tools can’t help you much there. We’re now measuring efficiency, not just speed.
Quick design isn’t how fast you can draw pixels on an artboard. It’s knowing the RIGHT pixels to draw, for the right reasons.
Quick design is the realm of expertise. It’s the cumulative effect of practicing a skill deliberately over a long period of time, until it’s second nature to you. This is when the right design solutions come with little effort. It’s like being in the zone.
Why does it matter how quick you are?
If you accomplish more in an hour, your time is worth more to whoever is paying you for it. Even if you don’t charge by the hour, it’s in your best interest to achieve as much as possible with your time. If you accomplish one job faster, it leaves more time for another job. Regardless of how you price your services, you’re winning if you’re doing more with less time.
This is why you cannot compare rates unless you also compare experience, quality, and speed of output. It’s why a junior designer may charge half as much as a more experienced one, yet still offer less overall value for money.
If you want to command the kind of rates you need to earn six figures, you have to offer a lot of value for your time. There is no way around this.
Speed is only one aspect of a designer’s value.
The quality of both your decision making and execution is another. Your design principles and aesthetic preferences play a part too.
One often overlooked and under-advised path to increasing your value as a designer is to broaden your range of skills. We’re all taught to niche downand become and expert in at least one thing. But once you master than core skill, broaden up and develop a range of complementary skills that support your specialty.
That could be integrating more info architecture and UX design intro your process. Or learning to code so you can better empathise with developers. Maybe it’s learning more high-level business strategy and product design skills. Diving into marketing, content design, copywriting, or sales.
The more you know, the more unexpected value you can offer. Those hidden prizes often win over your clients.
What I’ve learned
Quick Qualityᵀᴹ is the recipe for maximum design value. It’s the assurance that on the Venn diagram of Quality, Speed, and Cost, you’re going to land in the sweet overlap of all three. Because you consistently produce quality work quickly, you ensure your cost-to-value ratio remains unbeatable.
Facilitate Quick Qualityᵀᴹ by broadening your skills and experience, giving you a larger toolbox of readily-available design solutions to call upon, reducing the need for costly trial and error.
Fast design vs. quick design
Do you struggle to match the speed of your more experienced design colleagues?
Think value instead of time to earn more and stress less
Value-based pricing is all the rage. I love the concept, even though I’ve struggled with the obstacles of implementing it. It’s been a hot topic for years, and I expect it will be debated even more as we transition into a post-AI world, were the balance between work and leisure must be redefined.
If you’re unclear what value-based pricing is, please read this first. I’m not going to talk much about the direct merits of this pricing strategy.
Yes, it’s one path towards earning more and working less. Yes, it incentivises you as a designer to provide amazing solutions to your clients, because your pay is directly correlated with the (assumed) value you provide to their business.
What I really want to discuss are the psychological effects of its underlying principle: decoupling money from time.
When your earnings are no longer correlated with the amount of time you work, that’s an enormous mental shift. Firstly, because it breaks the plateau of what you can earn when trading time for money. But at a deeper level, it disrupts our entire mental paradigm of work ethic, productivity, and self-worth.
It’s a ride you have to take yourself first, and then invite your clients to come along with you once you’ve wrapped tour brain around it. It requires a complete commitment from both sides to transition to this new mode of thinking.
Many freelancers — myself included — aren’t yet able to jump with two feet into that deep end. However, there are ways to gradually transition into a value-based way of thinking. This transition is beneficial in more ways than just potential for higher earnings, as I’ll explore later.
In Does value-based pricing live up to the hype?, I describe two techniques to transition towards value pricing: Assumed value and price anchoring. Both methods help you extend the concepts of value-based pricing into a world still dominated by the mentality of time=money.
I’ve also started preferring to work on weekly retainer agreements, which I describe like this:
I will guarantee a client a certain number of hours per week, in exchange for a flat weekly fee. To sweeten the deal I give them a few extra hours per week for the same flat fee, if the project demands it and my workload allows it. Any overage beyond that weekly limit is charged at an hourly rate.
I may use the above-mentioned value-anchoring to help determine the price of my weekly retainer fee.
When I present this retainer proposal to clients I always tie it back to project responsibilities, deliverables, and goals. They see a description of what I will achieve for them, a duration for how many weeks the projects will take, and a weekly rate for the cost of my services and experience.
While it’s not perfect, it goes a long way towards making my rate feel less like a commodity that can be compared to others. Instead, they compare my fee against the value of the deliverables I will provide and make a determination as to whether that’s a good investment for them.
What to charge: does value-based pricing live up to the hype?
Demystifying pricing techniques + value pricing implementation tips
Why is framing the discussion around value instead of time important?
It’s about how your price is perceived by clients. Turning the discussion away from “how many hours this will take?” to “here’s how I’ll deliver greater value for your business” means they judge your cost against assumed value, not time. Time is seen as a commodity, which means it’s easily compared to other people’s rates. There’s always someone willing to work for less money, so you never win that comparison. Value can’t easily be commoditised, which forces clients to asses your work on its own merits, and compare it to their internal metrics for success.
Client perception isn’t the only benefit. Your own perception is equally important.
It may sound like a stretch, but I believe the concepts of value-based pricing are a key to improving the mental health of freelance creatives and high-strung tech workers.
The freelancer’s mental load explores how self-employed business owners and designers are plagued by constant anxiety, and the guilt of being under-productive. This relentless pressure means we’re never fully focused on work, and never fully resting when away from work. Our minds are churning 24/7, and it’s difficult to find the off switch.
A big part of that unrest comes from the feeling that every hour in the day needs to be productive, because when we’re not doing billable work, we’re not earning. We associate our productivity and self-worth with how much time we spend at work, because we’ve been culturally conditioned to believe that time worked (and hard work) equates to more money earned.
If we could remove that preconception, all of the anxiety would melt away. Framing price in terms of value instead of time is a large step towards this goal, as my personal experience can attest.
A shift in time scale has made my productivity sustainable
After having a few record-breaking months of income, I began thinking “Is what I’ve been doing sustainable? Can I keep working like this, and earn this much every month?”. The answer is yes, but only because of recent changes I’ve made to my pricing and scheduling processes.
Remember I mentioned I’ve been using more weekly retainer pricing agreements? The effect that’s had on my psychology has been tremendous. It’s given me a level of income certainty I’ve never before experienced as a freelancer, AND a detachment from incessantly worrying about billable hours worked each day.
Instead, I focus on how much value I can deliver my clients during one week of work. Sometimes that week is 10 hours. Sometimes 15 or 20. (It’s never full-time because I split my time between two projects at once). I don’t stress about the time anymore, as I’m thinking in blocks of weeks instead of hours. That massive increase in time scale is enough to psychologically decouple my earning from hours worked, even though I’m usually still billing for time.
This also helps me estimate project duration and cost. All I have to think about is how many weeks a project will take. Multiple that by my weekly rate, and BOOM, there’s a no fuss project estimate. It’s easy for clients to understand and budget with too.
A hybrid value-based pricing structure — organised around weeks instead of hours or days — has completely transformed the way I work. It’s a great start towards easing the freelancer’s mental load — reducing stress and uncertainty, while simultaneously boosting earning potential. It’s also started shifting my clients’ perceptions about cost and value, which opens the door to more extreme value-pricing methods, with a goal towards complete decoupling of time worked and money earned.
The freelancer’s mental load
When you run your own business, can you afford to have an off switch?
I made heaps more money over the past year than any year before. I put this sustainable freelance success down to these key points:
- I have a diverse range of client types and project sources. By not niching down on one industry, I gain greater variety and more incoming opportunities.
- I’ve built a strong reputation and leveraged referrals, so most of my clients come to me preloaded with trust, and at zero marketing cost.
- I’ve increased my value as a designer by learning how to work quickly, maintain high quality, and broaden my skillset. This creates constant client satisfaction and unbeatable value for money.
- I’ve earned more and stressed less by framing my time in weeks instead of hours, and implementing hybrid value-based pricing techniques.
It should go without saying that none of this matters if you aren’t great at what you do. Being an expert is a prerequisite to freelance success. But don’t confuse expertise with niche.
And I should point out that age and experience naturally bring more trust and respect. Building this foundation takes time. Even if I’d known all of this 15 years ago, I wouldn’t have been able replicate my current success as a young 20-something designer. It simply doesn’t happen that fast unless you strike a rare vein of luck.
It’s great to have a formula to get where you want to go, but equally important are patience and perseverance. Play the long game. Take small steps to build your business day by day. Consistency is the key.
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Hi, I'm Benek Lisefski. Since 2001 I've run my own independent design business. Join me as I unfold 18 years of freelance business knowledge: honest advice and practical tips to help you take your indie career from good to great.
MediumTop writer in Design, Business, and Entrepreneurship.