So You Want to be a Freelance Translator or Interpreter: Money Matters
In the first post in this series, I alluded to a question I’ve been asked several times since I began freelancing—sometimes more subtly than others: “Do people actually pay you to do that?” Some days it feels surreal that, yes, people really do pay me for this and I get to read in Spanish, write in English, and sometimes even correct other people’s spelling and grammatical mistakes (Grammar Police Alert!), but the underlying question is whether translation and interpreting are viable career options for bilinguals. The short answer is yes—if you have the right skill set.
If you’re just beginning to consider whether a career in T&I may be for you and are asking the same question, you are not alone. Some of the biggest questions many beginning translators and interpreters have about getting started also revolve around money: How much do I charge? What kinds of expenses will I have? How do I make sure my clients actually pay me (on time)? I’ll do my best to cover these tricky yet essential questions in the following lines.
What should I charge?
Translators often charge per word (source or target) or per hour, while interpreters may charge per hour, half day, or per diem rates. Rates can vary significantly in different segments of the market, while your specialization and language combination can also play a major role. Quoting too much relative to the importance and budget of a particular project may make it hard to secure enough work. However, quoting too little could put you in a vicious cycle where you work long hours at low rates. Long-term business prospects and finances can be affected by your choice of rates because it’s difficult to make time to find higher-paying projects and invest in the skills development and training needed to qualify for them if you are too busy with smaller or lower-paying projects and clients. And on top of all that, you could end up undercutting your colleagues.
While newer translators and interpreters may logically earn less than more experienced professionals—like in any other industry—you can earn fair compensation for your experience and education level, if you are putting the right amount of time and effort into your work and business development. But again, this begs the question: What should I charge? There are a few good ways to figure out what that means in terms of specific numbers.
First, the American Translators Association (ATA) has conducted and reported on a survey of professional translators and interpreters regarding their compensation and rates. The results of this ATA Translation and Interpreting Services Survey, Fifth Edition can be accessed for free in summary form or in full form (free to ATA members, $95 for non-members). The results cover information on rates, language pairs, and annual income.
Calpro is another resource you can use to determine what rate you should charge in order to bring in your target income, taking into account working hours, holidays, and other expenses. This spreadsheet was first developed by the Spanish association of translators, ASETRAD, and was adapted by ATA volunteers for use in the U.S.
Tracking the time you spend on each project is a great way to generate data that can help you figure out how much you actually are earning and which projects are more or less worthwhile for you. Start by using a time tracking tool like RescueTime or Timecamp and then use an Excel file or other method to compile your data and divide the total fee for a project by the number of hours spent on it to see how much you earned per hour. This will help you determine whether you might need to charge more next time for a similar type of text, or whether you would be better off rejecting a project that you will likely earn less on in favor of a project that would earn you more per hour, or even in favor of spending time on business development to grow your client base.
How do I make sure I get paid?
Two common issues when it comes to getting paid for freelance work are scams (where a fake client orders work from you and either never pays or scams money out of you by means of a fake check) and late payers. Several resources exist to help freelancers avoid these issues, including Payment Practices and WPPF (and check out this article on the topic).
How do freelance finances work?
I could write pages upon pages about freelance finances, but at the end of the day, the important thing is to understand that earning money as a freelancer (what we would refer to as “1099 income” in the U.S.) is vastly different from earning money as an employee of a company (“W2 income”). Freelancers need to send invoices to request payment from their clients, pay their own taxes (usually there is no withholding and you make estimated payments throughout the year), manage their own retirement savings, cover their own business expenses, and meet their own insurance needs. All of these are things that employers will often handle for their employees, while freelancers need to build them into their time and finances. I won’t go into detail about each of these topics, but I do want to provide a resource or two on each topic in case you need somewhere to start looking.
- Invoicing and Expenses
Some freelancers choose to create their own invoicing processes and others prefer to use software to help manage the process for them. The following are a few popular invoicing tools for freelance translators and interpreters: Xero, Translation Office 3000, Express Invoice.
Some freelancers choose to do their own taxes, but many prefer to outsource this service to a professional accountant or accounting firm. Since there are so many extra factors that go into freelance tax filings (e.g. multiple 1099’s, a Schedule C/1040, possibly other business filings depending on your setup and location, and deductions for business expenses), options like TurboTax and TaxAct would probably make for a stressful springtime… So unless you want to forego a lot of afternoons going crazy trying to decipher the tax code, I would suggest reaching out to other translators in your area to get recommendations for an accountant you can trust to take care of your tax needs.
Employers generally contribute to your retirement savings when you are a W2 employee, so it is extra important to start early if you’re a freelancer. Options for freelancers include traditional or Roth IRAs and SEPs, whether through financial planners or using online options like Vanguard and e-Trade.
Another expense that is often subsidized by employers for W2 employees is insurance (health, vision, dental, life, etc.) As a freelancer you’ll need to take care of this yourself, but you won’t be alone! Many options are available outside employer-sponsored health plans. For instance, Freelancers Union offers a private marketplace for members to connect with insurance companies (and Union membership is free!).
We hope this information has helped you get a better idea of what to expect as you consider a career as a freelance translator or interpreter! Check out the fifth and final installment in this series: Technology and Tools.
This post is the fourth of five in a series of posts written in response to questions we at The Savvy Newcomer have received. Sometimes these questions have come from people within the translation world, but also from bilingual friends and family who are interested in translation and interpreting (T&I). Our hope is that this series will serve as a guide for people who are considering a career in T&I and want to know where to start. See all posts in this series So You Want to be a Freelance Translator or Interpreter.