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Setting Your Salary – How Much Is Enough?

When searching for a telecommuting job, it’s to your advantage to know the going rates for various positions. Once you have this information in hand, you’ll be better equipped to negotiate a fair price for your efforts.  Utilizing the facts you’ve discovered will allow you to receive a compensation plan that’s mutually acceptable to both you and your employer. 

Changing From In-Office to At-Home

You might expect to receive a pay cut once you agree to telecommute, but actually the only thing that changes is your location.  The only time your salary should drop is when your hours have proportionately decreased. All benefits, salary and other entitlements should remain relatively unchanged.

When you locate an employer who will allow you to telecommute, realize the value you offer to them.  Not only are you providing them with a service, but many other items as well, such as your own equipment, use of your home office space and supplies that would cost them additional money.  So stick to your guns and insist on a fair salary.  If your company doesn’t reimburse you for equipment, consider it your buy-in to a home office work environment.  Unlike a reduction in pay, these out-of-pocket costs may be tax-deductible.  And the equipment is yours to keep if you should choose to launch another home-based business in the future. 

You should also consider who would be responsible for upgrading and maintaining your home office equipment.  Although you own it, you’re utilizing it for their benefit.  Discuss this up front so there are no misunderstandings.

If an employer is haggling over salary, a negotiating tool that may be used is vacation pay.  Originally intended to reward workers for their tenure and allow a respite away from the workplace, you may feel that perhaps you don’t need quite as much time away from the “office” as before. 

You will definitely benefit from telecommuting and can find many work at home job opportunities here, but keep in mind that your employer will most likely benefit just as much.  As a content, long-time employee, your job knowledge has at least equal value to the company.  Keep this in mind when you begin establishing an asking price.

Starting A New Venture

If you’re beginning a new career in telecommuting, deciding how to price your service or products is a difficult task.  Many, especially women who work out of the home, tend to undercharge.  Begin by contacting temporary or placement agencies and inquiry about the standard rates for specific jobs.  Salary surveys and auction job sites are also available online for you to compare fees.

For some jobs there is a wide range in pay scales.  So where do you fit in?  First determine your level of skill and where you most likely fall within the given salary information.  Make sure you’re using local statistics so you can be competitive.

To help establish your fees, create a business plan to determine your operating expenses, estimated taxes, insurance, marketing expenditures and earnings for the year.  Next determine your break-even point – the amount you would need to make to cover all your costs.  This figure will help you set your pricing.  Small business accounting software is available to help you do this. You may also consider meeting with a personal accountant, especially when you initially start your business to ensure realistic goals and profits are determined.

Once your fee has been arranged, verify your prices with industry standards or competitors.  Check out the classifieds to see if salary ranges are listed for in-office positions.  Do they match up?  Most telecommuting jobs pay similar rates as their traditional counterparts. 

Try to remain flexible with your rates, you may learn that you need to adjust pricing as your business expands or you may need to tweak your rates for individual clients.  It may also be useful to determine separate rates for various tasks you’ll be performing.  To do this, estimate how much time that it takes you to complete each of the assignments.  Next, multiply the time by your hourly rate.  This equals your piece rate and gives you a starting point for setting fees.

The following is a general listing of salary ranges for various fields of work ^*.  Depending on your local market, these pay scales could vary slightly.

Accounting Clerk                                 $23,000 - $33,000

Administrative Assistant                   $21,500 - $35,500

Creative Director                                  $45,000 - $60,000

Customer Service Representative     $22,000 - $35,000

Editor                                                     $34,000 - $70,000

Illustrator                                               $37,000 - $64,000

Reporter                                                 $28,000 - $45,000

Sales                                                       $20,000 - $65,000

Software Programmer                          $57,000 - $84,000

Web Designer                                      $45,000 - $60,000

Word Processing/Data Entry             $20,500 - $26,000

^* Compiled from several online surveys

Pricing your telecommuting services is based on an ongoing evaluation of your costs, time involved and meeting your customer’s expectations.  You should constantly look for ways to raise your profits and lower your operating expenses, while increasing customer satisfaction.  Don’t be afraid to ask for a salary that suites your services – your rates signify to your clients the quality of service that you provide.

 

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