The Money Shot

I get asked how much I charge for my services a surprising amount by other bookkeepers. Honestly, I never really know what to say. Not because talking about money bothers me (I wish more people would talk about it!) but because whatever I say, I can’t win. If it’s not as much as they are expecting or they charge then I am either undervaluing myself or undercutting them, and if it’s more than they are expecting then I clearly think a lot of my ability to do what I do.

I suppose I differ to most traditional-style bookkeepers in that I currently only work for two clients on a regular basis. One pays me for three days a week, the other for two days a week. For this I get a fixed monthly charge, on the basis that if I go on holiday or have any time off, nobody else will do my job, so I will have to put in the extra time to catch up. I’m lucky in that respect. But it has taken years of them working with me and negotiating by both parties to get to this point. They both needed to trust that I would work all the hours they pay me for, especially when working from home. In both cases, the hourly figure doesn’t really work, as they essentially get a bulk discount for employing me for a fixed number of hours each week.

But that doesn’t deal with the issue of new customers. Again, honestly, it really depends on who they are and what they want. A very small sole trader who just wants an hour a month may not be willing or able to pay as much as a limited company who wants eight hours a week, who would probably be ok with paying more.

You can take a very rigid approach and have a set figure that you’ll just state to everybody, and leave up to them if they think you’re worth it or not. You can have a minimum figure you’re willing to accept and then start higher, allowing for negotiation downwards if necessary. Personally, I prefer flexibility. I have a minimum figure that I will work for. I am not qualified so feel I can’t charge as much as people who are, but I do still have overheads I need to cover, such as all the AML fees I have to pay annually, so my business needs to be profitable, but that doesn’t mean I need to charge the earth. My theory is that if I start relatively low (usually £15) then if the job is long term, or if I am asked to take on additional responsibilities, or more hours, that keeps me the flexibility to ask for more money later. If you start high, your flexibility is reduced. I’m not saying everyone should do this, I’m not recommending it as the way to go, I’m just saying it’s what I do. Once people have worked with me a while, I have a good idea about whether they can afford to pay more, and I can have a reasoned discussion about a possible increase. That way, you come in from a position of strength.

In some cases when I’ve taken on a new client and their accounts need a lot of work to get them up to scratch, where an hourly fee has been agreed to be paid, I always ask if they have a budget. If you have the time and are being paid £20 an hour, it wouldn’t take long to clock up four figures, which might be a bit of a shock to a client. Not having the conversation could lead to cash flow problems for the business and therefore you, so it’s best to be honest from the start.

The truth is that I’ve always valued the type of work and relationship with the client above how much they pay me. I want to enjoy the work and the working relationship more than I want to get paid loads of money. I still have a mortgage and bills to pay so I need to be paid fairly for the job that I do. But I wear my heart on my sleeve and if I hate the work, or don’t get on with the client (it happens), then it doesn’t matter how much they pay. Unless I really really need the money (again, it happens), I won’t be able to commit to it. And sometimes it takes working for someone for a while before you realise this.

This attitude has surprised people when I’ve discussed this with them. I remember one particular conversation with someone who was starting out in business as a bookkeeper. I mentioned to him that I had received a number of approaches on LinkedIn but each time I’d had no capacity so I had to politely decline. He was horrified that I hadn’t even found out how much they were paying before dismissing them. They might have been paying more than I was currently on! He simply did not understand that being happy in my job and being paid fairly was enough for me. Maybe he’s unusual, but maybe I am.

I suppose my point is that you have to find your own way. You know what you need and want from your work. The thing about being self-employed is that you can do things your way. I prefer a flexible approach because that works for me and for my clients, but it may not for you. Do what’s right for you, and good luck!