Perhaps not coincidentally, I had two totally separate conversations on Sunday within the same theme: how much should I charge?
Later that day I tweeted:
Several folks responded that they’d like to hear more about my reflection in a blog post, so here it is.
One conversation was with a friend who’s interviewing for a new full-time job. Another was with a friend who’s pitching a consulting gig. Both were unsure of how to make their case.
Ultimately we all realized that this has very little to do with the money itself — something I think I already knew, but needed to relearn. Money is only a quantitative assessment and agreement between supply and demand, consumer and producer. Value is determined by the scarcity of the merchandise; the more you have something to offer that no one else can provide, the more you’ll get paid.
When anyone asks me, “How do I figure out my value?” I say that value is the greatest amount that someone is willing to pay. It’s incredibly elastic, so it’s crucial that we continually put ourselves in a position to figure out how that value is shifting.
But there’s a deeper issue here: your current value is not necessarily equal to your worth. And the only way to get your value as close as possible to your worth is to know how to sell yourself.
Of course there are people out there whose value is much greater than their worth, and I say more power to them for selling something that doesn’t exist. What they lack in hard skills they certainly make up for in soft ones.
What you’re worth is a question only you can answer. It’s loosely a combination of your ability, experience, and instinct. I don’t believe any of these three can be objectively measured, therefore it’s your responsibility to make a subjective assessment and assign a dollar amount to it.
Some people charge by the hour, but I won’t. If my worth requires more time to shine through, the client should not be penalized. But if my worth gets me to the answer faster, why should I be penalized?
When you present a client with three options — the rate you’re willing to take, the rate you expect, and the rate you deserve — any smart businessperson would offer the rate you’re willing to take. Why? Because it is every business’s duty to increase revenue and decrease cost. If a business isn’t actively trying to do this, that probably isn’t a business you should be working for.
They’ll ask for the cheapest option and will agree to limited scope, but I assure you they’ll come to expect more than they’re paying for as the project progresses. Because they know that you have more to offer. They know you’re worth more. And worst of all, they know that you don’t.
Accepting a valuation that’s less than you’re worth is a quick way to lose others’ respect and diminish your chance of success. By pricing your value at full worth, you give the person an opportunity to have more than they thought they needed. Not everyone will recognize this opportunity, but the right person will. That’s the person you want to work for.
Having a full-time salary isn’t much different. If you believe you deserve more, then you owe it to yourself to ask for it. But remember that you’re also going to be expected to deliver on it. It might mean having to up your game.
You find your worth when you butt up against your own limitations. If you aren’t always trying to outdo yourself, then you won’t know where that worth lies. Moreover, you lose the biggest opportunity of all: making yourself worth more.
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