What the practice earns and what the year's records show
Gross receipts, expenses and hours together show what a freelance practice earns. A review of those records compares clients, projects and trends against the owner's financial and professional goals.
Gross and net earnings
AMWA's 2007 survey collected calendar-year 2006 income, defining freelance gross income as money collected from clients and net income as the amount after expenses such as insurance, subcontracting and equipment but before taxes and retirement contributions. The reported mean gross income was $119,295 and mean net income $93,306, or 78% of gross; health insurance (36%) and licensing (29%) were the most commonly reported operating expenses. Full-time freelances primarily writing reported mean net income of $110,232, compared with $75,891 for an equal writing-and-editing mix and $46,071 for primarily editing.
AMWA's 2019 report defined full-time freelance work as at least thirty-two total weekly hours, including billable and nonbillable time. For 2018 it reported mean gross income of $154,296 for full-time freelances and $73,897 for part-time freelances, who worked an average of twenty-two hours weekly. Unlike the 2007 definition, its net figures were after taxes and expenses: $106,947 for full-time and $53,592 for part-time freelances. The full-time mean gross had risen from $131,400 in the 2015 survey, while the median remained $114,500.
Among full-time freelances, mean 2018 gross income was $177,927 with more than ten years' freelance experience and $124,039 with five years or less; those working mainly for pharmaceutical and biotechnology companies averaged $231,798 and $206,333 respectively. Primarily writing averaged $176,979 against $84,403 for editing, and team-leading averaged $225,559 against $146,298 for writing or editing with some client guidance. For those spending at least half their time in one area, regulatory writing averaged $206,400, sales training for pharmaceutical or biotechnology companies $173,235, marketing and advertising $152,588, and continuing education $146,801. Income earned mainly in the US West and Northeast exceeded that in the South and Midwest, with a Northeast mean of $177,644 against $126,676 in the Midwest; respondents earning mainly outside the United States, most often Japan or Canada, reported lower gross incomes.
The 2019 survey's 164 full-time respondents reporting 2018 gross income had a first quartile of $71,071, median of $114,500 and third quartile of $218,750. Median gross was $151,000 for primarily writing (114 respondents), $77,500 for editing (36) and $102,052 for other work including research and quality control (14). By the area producing the most income, the reported distribution was as follows; categories with fewer than ten respondents were withheld.
| Area | Respondents | First quartile | Median | Third quartile |
|---|---|---|---|---|
| Regulatory writing | 42 | $143,000 | $203,000 | $250,125 |
| Scientific publications | 24 | $85,500 | $103,000 | $201,250 |
| Continuing education | 19 | $56,000 | $77,000 | $160,000 |
| Marketing/advertising | 16 | $95,500 | $114,500 | $212,500 |
| Other | 16 | $67,500 | $106,300 | $211,250 |
| Pharmaceutical/biotechnology sales training | 15 | $81,000 | $106,000 | $305,000 |
| Medical research/grants | 10 | $26,907 | $73,500 | $138,500 |
The income table described full-time respondents as averaging 42.5 total weekly hours; respondents included freelances outside the United States and not everyone answered every question.
Recurring operating expenses reported for 2018 included professional dues and subscriptions (93.7%), a tax accountant (70.1%), utilities (62.6%), education and professional development (60.3%), health insurance (48.9%), unreimbursed travel (33.9%), liability insurance (31.0%) and marketing (27.0%). Other reported costs were office space (25.3%), life insurance and licensing (23.6% each), IT support (23.0%), legal advice (19.5%), disability insurance (17.8%) and administrative assistance (7.5%); respondents could select all applicable costs. Half of full-time respondents described their business as more profitable in 2018 than in 2017.
Earnings targets and fixed costs
EMWA's 2023 freelance business survey reported a mean target minimum monthly income of €5,608.40, with responses ranging from €400 to €30,000. These were targets, and the authors could not determine whether high expectations reflected outsourcing or small-business activity with higher outgoings, or differences in experience.
For the share of earnings destined for taxation and insurance, the survey reported 32.7% selecting 20%–30%, 11.2% selecting 30%–40%, 6.3% selecting 40%–50% and 1.8% selecting over 50%. The lowest band, selected by 13.5%, was printed as “>20%” in both the questionnaire and results, although the accompanying account described 46.2% as having fixed costs below 30%. Four respondents reported costs above 50%, one each in Germany, the Netherlands, Italy and Austria; all were entirely freelance and three primarily worked in management. The table's five cost-band counts totalled 146, and its no-response row also printed 146 (65.5%).
Effective hourly earnings
A useful year-end review requires earnings and hours recorded during or immediately after each project, including hours on fixed-fee work so the achieved rate can be calculated. The effective hourly rate is the total earned from a client divided by all hours worked for that client during the year, allowing comparison between clients.
A hypothetical year's figures illustrate why the largest payer need not produce the best hourly return.
| Client | Earnings | Share | Hours | Effective hourly rate | Payment basis |
|---|---|---|---|---|---|
| A | $20,000 | 20% | 321 | $62 | Hour |
| B | $17,000 | 17% | 262 | $65 | Abstract |
| C | $16,000 | 16% | 218 | $73 | Project |
| D | $11,000 | 11% | 86 | $128 | Hour |
| E | $9,000 | 9% | 43 | $209 | Project |
| F | $7,000 | 7% | 60 | $117 | Abstract |
| G | $7,000 | 7% | 54 | $130 | Hour |
| H | $5,000 | 5% | 63 | $79 | Hour |
| I | $4,000 | 4% | 59 | $68 | Pages/hour |
| J | $4,000 | 4% | 34 | $118 | Hour |
| Total | $100,000 | 100% | 1,200 | $83 |
Client A supplied the most income but the lowest effective hourly rate, below the overall $83, while Client E's smaller contribution produced $209 an hour. Efficient project-fee work made Client E profitable in the example, while improving Client A's hourly-billed return would require raising the rate.
Year-end and longer-term review
A review can cover earnings, clients, projects and marketing, both at year-end and across years. The suggested review framework connects records to business questions.
| Review | Records | Questions |
|---|---|---|
| Year-end bookkeeping | Client list, income forms, expenses and project hours | Old and new clients; marketing success; client earnings; tax preparation; investment in the business; hourly billing and effective rates |
| Year-end earnings | Annual earnings, client shares, charged and effective hourly rates | Goals met; highest and lowest earnings; actual return; project versus hourly billing |
| Year-end clients | New clients, earnings by client and best clients | Growth of the client base; profitability; year-end thanks |
| Year-end projects | Types, earnings and job satisfaction | Writing, editing or other work; subjects and formats; higher-earning jobs; variety and intellectual interest |
| Year-end marketing | Efforts, new clients by source and number contacted, website statistics | Activity; useful sources of new clients; response rates; visitors, pages, duration and discovery route |
| Year-to-year earnings | Annual earnings, hours and effective rates | Higher earnings; harder or fewer hours for more or less profit; rate trends; pricing method |
| Year-to-year clients | Rate history | Rate increases or replacing low-paying clients |
| Year-to-year projects | Project types | Variety and use or expansion of skills |
| Year-to-year marketing | Results | Response rates and new-client numbers |
Rising earnings alone do not show whether the practice is becoming more efficient; comparing annual hours with effective hourly earnings distinguishes working harder from earning more per hour. The profit-oriented example treats higher earnings with fewer hours and a rising effective rate as desirable, but owners must choose the analyses and definition of success appropriate to their business. Every paying project needs records, which may be kept in software or on paper, and simple tables, pie charts and bar charts can be made with ordinary presentation, word-processing or spreadsheet software.
The practical aims are to review annually and across years, improve earnings, decide between hourly and project rates, identify preferred clients and projects, check marketing, work more profitably in fewer hours, maintain intellectual interest, make changes and build on successes.
Strategic review
Periodically examining clients, projects and deadlines helps direct marketing time and money toward work that meets the owner's business goals. A yearly evaluation can ask whether earnings, project mix and professional life are satisfactory, where the practice should be in two, five or ten years and how to get there. One midcareer writer's advice was to begin thinking strategically after a few freelance years, once the initial pressure of launching and finding clients had eased. Losing large clients prompted that writer's first strategic review, revealing that much existing work was not preferred; refocused marketing attracted more of the desired work, followed by regular year-end reviews.
Milestones beyond income
A 2023 business coach's twelve-stage framework offers one practitioner's way to assess progress without conventional career metrics; not every freelance reaches every stage. Its author sells business and marketing coaching to new freelance medical writers.
- A first client, signalled by a signed contract or scope of work.
- Monetisation followed by profitability, with payment for the first delivered projects.
- Leaving another job when self-employed income exceeds the salary.
- An entrepreneurial mindset, reflected in choosing holidays, rejecting unnecessary meetings or raising rates to reflect value.
- A full workload for a handful of clients, with work declined because of overload and a question about whether clients control the business.
- A clear personal brand guiding business decisions; the example is a pharmacist whose novel-drug specialism strengthened messaging and attracted companies bringing products to market.
- Resilience, separating business decisions from personal worth, recognising development and self-care needs, and no longer feeling emotional impact from rejected proposals.
- Consulting authority, questioning briefs and offering ideas or strategy to meet clients' objectives.
- No longer investigating attractive full-time jobs.
- Reputation producing referrals from strangers without active marketing for months.
- Leadership through speaking, teaching, coaching or mentoring.
- Agency growth through employees or subcontractors delivering work while the founder handles marketing, sales and relationships, when overload recurs and slowing down is unwanted.
The accompanying diagram called the twelfth stage “Mentorship”, while the text called it building an agency. The framework allows remaining at a comfortable stage with a good balance between work and life, and using the milestones to take stock, identify next steps or recognise progress.