Training for Translators

Classes for translators and interpreters

Money


Corinne McKay

Providing your own benefits

Today’s Get Rich Slowly post on saving money on insurance got me thinking about benefits in general. This is one of the most common questions I hear from beginning or aspiring freelancers: how to handle health insurance/retirement planning/disability insurance, and so on. Here’s an overview of the freelance benefits I’ve researched and used; obviously the specifics vary according to your location, and these apply mostly to freelancers working in the U.S. Also, obviously I’m not an insurance consultant or a financial planner, so please follow this advice up with a professional before you implement it.

First, accept that when you’re a freelancer, benefits eat up a lot of what you earn. I think that this is yet another argument for charging real money for your services; it’s easy to think that 500 words an hour at 10 cents a word translates (so to speak) into $50 an hour in your pocket. However, once you deduct self-employment tax, health insurance, retirement contributions and unpaid vacation, you could be netting up to 40% less than you would if you worked for an employer. If you carry other coverage such as disability, dental, life or professional liability insurance, you’re probably looking at 50% of your gross income going to benefits.

Second, look at the types of benefits you really need or want in light of your life situation and don’t always follow the conventional wisdom. For example, the Thoughts on Translation household doesn’t carry life insurance even though we’re in the demographic that should carry it (30s/40s with a young child) because we are completely debt-free, our living expenses are low and we have only one child to send to college. In our case, I feel we’re better off putting the money we’d spend on life insurance premiums into a savings account. But if you’re a single parent and your children would need to be supported into adulthood if you passed away,  you might need a hefty life insurance policy in place.

Now on to some specifics:

  • Health insurance is the elephant in the room if you live in the U.S. If you’re healthy, have no pre-existing conditions and have some savings to cover deductibles and out of pocket expenses, you can get a decent policy at a decent cost. For example, we pay under $500 per month for a Blue Cross/Blue Shield policy for our family of three, with a $2,000 per person/$5,000 maximum per year deductible. In our area, Kaiser and Anthem both offer reasonably-priced individual policies for the self-employed. The real headaches start if you have a pre-existing condition or even a past health problem that you have to disclose on the insurance application. Rumor among Colorado-based freelancers has it that you’re best off using an insurance broker, since the broker can help you fill out your application in a way that gives you the best chance of being accepted. This seems especially true if you had a health problem in the past that is now considered resolved or under control, for example if you were diagnosed with high blood pressure but it is well controlled with medication. Also, some States give you the option of forming what’s called a group of one, meaning that you get a group rate on health insurance even though you’re only one person. Here’s a CNN article about ways to obtain health coverage if you have pre-existing conditions.
  • Saving for retirement is a little less anxiety-provoking. It’s not hard to set up a SEP-IRA (Simplified Employee Pension Individual Retirement Account), Roth IRA or an Individual 401K (also called a Solo 401K or Super-Simplified 401K). These types of accounts offer similar features, but most people can contribute much more to an Individual 401K than to the other types of accounts because the base contribution limit is a flat amount rather than a percentage of your income. This may not be a factor if you only contribute a few thousand dollars a year, but if you want the option to contribute more, check out the Individual 401K. When you’re planning for retirement, consider what type of retirement you envision. Since translation is not physically demanding (and your clients don’t necessarily have to know how old you are!), many of us might work into our 70s and even later. But if you’re planning on logging off at 55 or 60 and hitting the country club, you may need enough money to support yourself for 30-40 years. Here again, I would recommend looking at your own reality rather than the conventional wisdom.
  • Then there’s vacation time and the fact that as a freelancer, if you’re not tapping the keyboard you’re not getting paid. You have a few options, such as taking “paid vacation” by working while you’re away. For example you could bring your laptop along and still try to work a few hours a day. I try not to do this because I like to get a real break from work, but it’s certainly better than not going on vacation at all. I think that a better option is to provide yourself with paid vacation by setting up a vacation savings account out of which you pay yourself during your time off. For example if you normally pay yourself $1,000 a week net and you want to take 4 weeks off per year, you could put $83 per week ($4,000 divided by the 48 weeks you’re working) into savings and then use that money to pay yourself during your month off. Unfortunately, I think that most freelancers just don’t take any or enough vacation, to to detriment of their non-work lives and enthusiasm for their jobs.
  • I don’t know much about disability insurance, but I would put it in the same category as life insurance: somewhere between indispensable and totally unnecessary depending on your circumstances. My impression is that it’s important to carefully review the policy to see what you have to do to actually claim the benefits. For example if you break your arm in a bike accident and can’t type, is that covered or excluded? If you can’t type but you can use speech recognition software, is that covered? If you develop an eye problem that makes it hard or impossible to use the computer, is that covered? I’ve heard several freelancers say that they decided to forgo disability insurance after concluding that an affordable policy is too restrictive, but this is worth researching if you’re concerned about it.

    • In conclusion, make sure to set aside some time and money for little bonuses. You know how a great boss comes up with great motivations or rewards for her/his employees? Like closing an hour early on a Friday when the weather’s nice, surprising everyone with good takeout for lunch, leaving $50 in everyone’s mailbox on the day before winter vacation or buying season tickets to a great concert series and distributing among the employees? Make sure to do those things for yourself once in a while too! Remember that benefits are intended to benefit you and make your life less stressful.


Corinne McKay

Ensuring payment from direct clients

In the past few weeks, I’ve spoken with a few freelancers who would like to work with direct clients but are afraid that they won’t get paid. One commented that she really enjoys working with agencies because of being able to check Payment Practices or a similar resource in order to determine the client’s creditworthiness. Although there is no Payment Practices for direct clients, I think that you can take some steps to ensure that direct clients will pay you, or to at least minimize the risk of nonpayment. I think that it’s useful to apply some or all of these steps depending on who the client is and how paranoid you are!:

  • Get full contact information from the client, including their phone number, mailing address and physical address.
  • Note whether the client is a member of any associations such as the Better Business Bureau to which you could report the client if they don’t pay you.
  • Google the client; see what kind of information about them is floating around the Internet
  • Ask for references from other freelancers or suppliers the client works with; ask those people about the client’s payment practices.
  • Clearly state your rates, payment terms and acceptable payment methods. Ask the client to issue a purchase order confirming that information and listing the name, e-mail address and phone number of their accounts payable person.
  • If you have doubts about the client or you are doing a large project for a first-time client, ask for partial or full payment in advance. I require 100% advance payment from anyone who is not an established business.
  • Accept a variety of payment methods. For example, I accept checks in dollars, euros or pounds, wire transfers, ACH transfers and PayPal. This gives clients a few payment options, and I always stick to the arrangement that they pay their banking fees and I pay mine.

Obviously, not all of these ideas apply to all situations, and some people are just more trusting than others. Personally, I like to believe that clients are fundamentally honest but I always ask for a PO and for the accounts payable person’s contact information, and I always require individual clients to pay in full in advance. Also, out of curiosity: agency owners, how do you vet your clients’ creditworthiness?


Corinne McKay

Ethical dilemma: when services cost less than you expect

Thoughts on Translation is back from a relaxing camping vacation in the deserts of Western Colorado. This vacation was completely unplugged; I didn’t take my laptop or netbook and only turned my cell phone on once a day to check my office messages. In other words, a real vacation! I highly recommend doing this at least once a year if you’re at the computer the rest of the time. Now on to more substantive issues…

A while back, I wrote a post about sticker shock: dealing with clients who are blindsided about how much professional translation services cost. Recently, I spoke with the owner of a small agency who brought up a different but related topic: how to react when a professional service costs less than you expect. In a nutshell…this agency owner works with clients in a very targeted industry that not many translators specialize in. When she landed a new client in this specialization, she needed to expand her pool of qualified translators quickly, so she posted the job on ProZ. In her words, “Not to save money in particular, but in order to widen the pool of potential translators.” This agency owner pays her current translators very fair rates, what I would consider the high end of the U.S.-based agency market (I’m guessing you can tell where this is headed!), and in her ProZ posting, she did not specify any rate at all, but left it up to the translators to state their rates.

So, the applications started coming in, and because of the way the agency owner worded her posting, the applicants were few in number and very well qualified for the job. However, their rates were generally between 25% and 60% less than what she had planned on paying. For example if she had been planning on paying 30 cents a word (this isn’t the actual figure, just an example), these highly qualified translators generally bid between 12 and 20 cents a word. In the end, the agency owner did not pick the cheapest translators, but also did not suggest to the selected translators that they raise their rates. I realize that this anecdote also brings up the issue of competitive bidding in general, translators who charge less than they are worth, and probably various other issues too. However, specifically related to the under-budget issue, what would you have done? Would you have told these translators that they were bidding half of what you were willing to pay, or would you have accepted the rates that they offered?


Corinne McKay

Responding to a request for quote

When you receive an “out of the blue” request for a quote from a potential translation client, what’s the best next step? Is it more advantageous to call the client, e-mail them, ask for more information or send them a rate sheet…or something else entirely? The beauty of impromptu inquiries from potential clients is that you, the translator, are in the position of power. Rather than attempting to sell the potential client on the value of your services, the potential client is coming to you. So, it’s important to decide how to convert this inquiry into a new client. Let’s take a look at some potential courses of action.

First, read the potential client’s e-mail carefully; note the information that they provide and don’t provide, because this will give you some clues as to the client’s level of seriousness and their knowledge of what translation involves. Look at the client’s website and/or Google them to get a sense of their business. Then, decide how to respond to the potential client; for example you might:

  • Call them or ask them to call you. I’m really not a phone person, but I do think that a phone call makes a good impression. You can get a sense of the client’s personality and they can get a sense of yours, you can chat about the project, what translations they’ve had done in the past and what they are looking for in this translation. My only hesitation with phoning a potential client is that I like to get the important project details (i.e. rate, turnaround time, other terms of service) in writing. So, if you take this tactic I think it’s important to follow up with a brief e-mail, for example, “Thank you very much for taking the time to speak with me this morning. Just to confirm the details of our conversation, I will be translating the document we discussed at a rate of X cents per source word and I will deliver it to you by 5PM Eastern time on Friday. I accept payment by check or wire transfer and the full payment is due within 30 days of the date on which I deliver the translation.”
  • E-mail them and ask for more information. It’s unlikely that the client’s initial e-mail included all of the information that you need, so you might e-mail them and ask some of the questions listed above. Thank them for contacting you and let them know that in order to provide them with a detailed quote, you’ll need to get some more information.
  • E-mail them your basic information about rates and terms of service. In part, I think that your response to potential clients should be guided by how much you need or want the work. Responding with some prepared information, for example “I’m attaching my 2010 rate sheet which includes my per-word and hourly rates as well as my standard terms of service, feel free to look these over and then let me know if I can provide you with a detailed quote” may not be the most personal way to respond to an inquiry, but it saves your time and immediately weeds out clients whose budget is much less than what you charge.

Whichever strategy you choose, make sure to lay the groundwork for a successful translator/client relationship. For example:

  • Respond promptly to all inquiries from potential clients. Even if you don’t want to provide a quote on the project, respond and let the potential client know that.
  • Clarify your payment terms and methods; decide whether you want first-time clients to pay all or part of the project fee in advance.
  • Ask the client to confirm the rate, deadline and payment terms in writing. This can be as simple as a very short e-mail or can take the form of a service agreement or purchase order, but make sure that you and the client agree in writing on these important details.
  • Ask the client for their accounts payable person’s contact information. For example, “Please let me know the e-mail address and phone number of the person to whom I should send my invoice, and let me know who I should contact if I have a question about the payment.”

Any other tips for responding successfully to inquiries?


Corinne McKay

Potential clients and sticker shock

Wiktionary defines sticker shock as “Disgust, shock or fright upon learning the price of an item offered for sale,” and this roughly describes the reaction of many would-be translation buyers when they learn the price of a professional translation. This leaves the professional translator with a dilemma: how to handle a sticker-shocked client.

In my experience, sticker-shocked clients come in two basic flavors: translation buyers who are somewhat informed about the translation market and translation buyers who are not at all informed about the translation market. I feel that I can deal fairly well with the first group: generally low-paying translation agencies that are out of touch with what quality-conscious translators charge. Because I feel (or at least hope) that these translation buyers have some inkling of what good translations cost, I don’t tend to get overly involved with them. As in:

Agency: “Our budget for this project is X.”
Translator: “I appreciate the contact, but my base rate is X times 2.”
Agency: “You can’t offer a discount?”
Translator: “I’m fortunate to be very busy at those rates, so unfortunately not.”

I find it much harder to deal with potential clients who, through no fault of their own, are completely out of touch with how much a professional translation will cost. In these situations, I’m often unsure how to allow the potential client to save face while delivering the news that the project will cost two or five or ten times what the potential client has budgeted. As in:

Potential client describes a really interesting-sounding translation project that is right up the translator’s alley. Then, the conversation turns to money.

Potential client: “So, can you give me an idea of approximately how much this would cost?”
Translator: “Well, in order to give you a firm quote I would need to see the full text of the book and we would need to talk about your deadline, delivery format, etc.”
Potential client: “But just as a ballpark figure, can you give me an idea?”
Translator: “Right, just as an example I translated a book of similar length a couple of months ago and the total cost was $7,500.”
Potential client: “Sorry? You mean $750, right?”

Over the past year I’ve had several conversations similar to the one above. These leave me feeling terrible for a few reasons: often, the potential client is *really* excited about the project. Sometimes it’s a book they’ve written themselves, sometimes it’s their grandmother’s journal that’s just been found in the family attic, sometimes it’s a book on a topic they feel passionate about and for which there is very little information available in English. I’m also unsure how much it’s worth helping these potential clients from sticker shock to acceptance. Sometimes I empathize with them (“I know, if you’ve never used a translator before it’s a shock to find out how much it costs”), sometimes I try a little client education (“I’m sure that you can find someone cheaper or even free, but consider the risk of ending up with an unusable translation”) and sometimes I just try to end the conversation. However, I feel that there must be a better way to handle this and bring these clients around to an awareness of what professional translation costs.

Any sticker shock coping strategies from the readers?