Tuesdays Together: February 2020
What Is Your Money Mindset?
This month our Green Bay Rising Tide chapter broke the silence around the topic of money with an open discussion around money mindset. We met at the newly opened female forward co-working space The Nest Cowork + Club located on Broadway in Downtown Green Bay. The space is insanely gorgeous by the way! We also invited local photographer Mary Breuer to speak on her experience with money mindset and pricing your worth.
I’m sharing some of the things she shared and other takeaways from the meeting below. But first, money is a topic that many find hard to open up about. I like many grew up being told you don’t tell others what you make. I love that TuesdaysTogether allows the space for our creative entrepreneurs to open up about their own experiences to help lift others up as well by breaking this barrier.
During the meeting my co-leader Nicole mentioned Rising Tide and Honeybook’s 2019 Gender Pay Gap Report they put out. It was a follow up comparison to the 2017 report that “uncovered a significant pay gap between male and female freelancers.” The 2019 report showed that women freelancers were still earning 26% less per project then men. While the pay gap decreased, it was lessened by more work being done rather than more equal pay. You can read more about the report on the Honeybook website, but it is definitely a conversation that is good to be having.
Takeaways from the Meeting
Rising Tide always puts out an amazing guide full of information and worksheets. One worksheet we provided at the meeting was a calculation to help decide if it was worth it to invest in a product for your business created by Stephen Diaz. (Ps. Stephen made an appearance on The Creative Legacy Podcast with Shaunae and I to talk passive income.)
However, we didn’t spend a ton of time in the guide at this meeting because we had a lot to talk about on our own and with Mary.
“It’s less about the money you receive and more about impact”
I wrote this down in my notes app as a quote from Mary. When we are thinking about what we should charge for a service it is easy to look to yourself with thoughts like, “Can I really charge that amount?” or, “Is someone willing to pay me $X?”
I remember one of my first big freelance projects I received as a student. I had thoughts like: “I’m just a student, what can I really charge?” I ended up creating a 300 page book for $600. With the amount of time I spent on it, the project ended up being completed for way less than minimum wage. And that didn’t include factoring in the expenses I paid for the programs to complete the design, much less the education I was investing in. Many of us at the meeting had stories like this. Our first projects losing money because we had our mindset on what we felt we were worth or what seemed like a good idea without understanding the time, energy and education of all that we were providing.
We also sometimes forget to remember the value and impact our service is providing. Mary is a photographer, but she isn’t just offering a photo. Instead she is helping the person she is photographing feel confident in the face their insecurities. That is part of the impact she provides in her services. She spends 70% of her time listening to the client so the remaining 30% she can make sure she is curating to the needs of her client.
Create a Profit Share Account or Bonus
Book recommendations! Profit First and The Pumpkin Plan, both by Mike Michalowicz were recommended. These books bring up how freelancers often pay themselves last, and that is backwards! With these book recommendations Mary also brought up the concept of creating a profit share account for your business. It is money you set aside throughout the year. Then at the end of the year or quarterly any money in the profit share account can be used to pay any outstanding balances, but the remainder is a bonus for you! Who doesn’t love a little “extra” money.
Ok, But How Do You Know What to Charge?
No doubt we shouldn’t simply be pulling any random number to charge for our services. But then how in the world do we determine what to charge? The first step is to know your numbers: what do you need to make to cover your expenses, both personal and business? That amount should be a portion of what you charge. Consider one third of what you make is reserved for taxes (consult your accountant for what you should set aside) and another third for investing back into your business. Knowing the total amount you need ot make, then consider your capacity. If you need to make $100,000 a year and you can take on 50 clients for the year, then you would need to be charging an average of $2,000 per client.
Of course you can create additional income sources to diversify that could be factored in. If you created an online course that earns $10,000 a year in passive sales, then your average would be $1,800 per client to earn a total of $100,000.
What takeaway resonates with you most? Share in the comments below.
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