Welcome to another episode of the podcast that teaches you how to be a ridiculously good virtual assistant.
Today I want to talk about undercharging … not charging your clients enough.
Today’s Quote: “You don’t get what you deserve. You get what you tolerate.” – Tony Robbins
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Connect with Tracey D’Aviero, VA Coach and Trainer
Episode Notes:
This is the third episode in my four part series on rates. Thanks for tuning in. If you haven’t listened to the other two yet, make sure to jump back and do that.
Are you simply tolerating what you are earning as a virtual assistant?
Most VAs don’t intentionally tolerate a low rate of pay. Most often they don’t even realize they are undercharging – or tolerating it – until someone like me questions them on it.
You are probably just trying to be practical, maybe cautious, and limely realistic. And you also might be undercharging.
And undercharging has a cost. And that cost is much higher than most VAs realize.
So today I want to talk about what undercharging is really costing you, beyond the number on the invoice or in your bank account.
Undercharging rarely starts as a big decision.
You choose a rate that feels safe. You think you just need to get your foot in the door.
You tell yourself it is temporary. You can always raise your rates later, right?
Makes sense. Seems to work. You get clients. Maybe you even get busy. You feel relieved. You feel GOOD.
You have clients. Of course that feels good!
But then what happens? Over time, that so-called temporary decision becomes your normal. And that’s when the hidden costs start showing up.
When your rates are low, your business has very little margin.
You need to bill more hours to cover your expenses, or to make ends even meet. You need more clients to feel like you are stable or comfortable. You have less room for growth, mistakes … or even rest.
So that means your business is always operating close to the edge.
You can’t easily turn down work. You hesitate to take time off. You delay investing in support or tools. Not because you lack ambition, but because your pricing isn’t flexible enough to allow you to stretch or grow.
I told you a couple of episodes ago how I set my rates too low right out of the gate – and left them there. I was so happy to have a few clients paying me to do their work, and I didn’t want to have any money conversations anymore so I stuck with what I had. For years I never raised my client’s rates, even though they were busy raising theirs regularly.
I just felt like I was lucky to have them at all. Does that sound familiar?
But there was definitely a cost. I couldn’t afford anything – remember when your clients pay you, all that money isn’t yours. You have expenses – business expenses, taxes, and whatever else you need to make your business run.
As your business grows, you want to be able to grow too. You want to be able to pay for things like an email system, a scheduling system, an invoicing or bookkeeping system, trainings, coaching, events, and more.
In order for your business to grow, you need to be able to plan for these things – and once you have set your rates too low, it’s hard to raise them. Sometimes your existing clients won’t pay more.
I can’t even tell you the number of VAs who have come to me for help with their rates, who just started working with a client a couple of months ago – and now want to raise their rates.
Yeah, you can’t do that. That’s the advice I give them. Your bad decisions are not your client’s problem. You agreed to work with them at a certain rate, and that’s the deal.
I’ll come back to this later in the episode, but that’s one big cost of undercharging that can come up very quickly.
And that’s why it’s SO important to get your rates right, right from the start. I give you lots of advice and tools to do that – please pay attention to it!
Let’s talk about how getting underpaid makes you feel.
Resentment starts to build – sometimes slowly, sometimes very quickly. And this is where many VAs start to feel stuck.
If your tasks expand beyond the original scope. If clients stretch or break boundaries like contacting you outside of agreed hours, or texting or calling you instead of emailing. Or if your clients start to assume your availability instead of asking you when you are available.
You start by feeling frustrated, but you also feel responsible, because you know you agreed to the rate.
So you don’t say anything. You do the work. Maybe you even work harder. You tell yourself you are lucky to have them, like I did. But you still resent them. It doesn’t go away when you ignore it. It just makes you tired. Exhausted even. And exhaustion makes everything harder.
Your pricing and your boundaries are very much connected.
When you are paid well, boundaries feel reasonable. When you are underpaid, boundaries feel … risky.
You worry that enforcing them will upset the client. You don’t clarify expectations as well as you should. You definitely tolerate things you would never accept at a higher rate.
It’s a weird thing – you think that the way you think is just the way you think. That’s a lot of thinking I know, but bear with me for a sec.
You don’t think that ‘well-paid you’ will think any differently than ‘poorly-paid you’. But you do. It’s confidence, but it’s also elevated – more professional, more solid.
When you aren’t charging your clients enough, this can translate into the other piece of advice I always give you – you teach people how to treat you.
That’s a much harder habit to break.
When you consistently charge less than your value, your brain uses that as evidence. When the brain gets into this, it really plays with your confidence.
It starts to tell you: I’m not ready yet. I need more experience. I should wait just a bit longer.
Even as your skills improve. Even as clients rely on you. Even as you do the work. Even as you become essential to their business.
Your confidence never catches up, because your pricing never reflects your growth.
So you stay in a version of your business that no longer fits the VA that you actually are.
Low rates create many types of problems.
Low rates create micromanagement, justification, explanation, emotional struggle. And that is not the client’s fault! Remember you set the rates, or you agreed to the rates if you negotiated (please don’t negotiate!).
But price sets the expectations.
If you go to a high end steakhouse, you will pay more for a steak – but you will also expect to get a higher level dining experience – linens, ambience or atmosphere, quality of food, attentiveness and professionalism of the server, and so on.
If you go to a diner, you can still get a great steak, but you will expect to pay less for it, it might be noisier or crowded, you might get paper napkins. When you need your server you might catch their attention and call them over, and so on.
Both places will provide you with the steak – and it could be good in both places – but the steakhouse price is supported by the extra stuff they do.
And the same goes for your services.
You set the tone. When you work with clients who pay less, they are often budget-conscious so they may ask more questions, expect more access or flexibility, and they might ask for extra stuff all the time.
When you work with clients who are paying for your value, they don’t want to micromanage you – they are trusting you to do what they need done. They expect you to take care of it, with professionalism, structure, and results.
I want you to really think about that – because that difference alone can change how your entire business feels.
Not charging enough affects more than just today. It delays your growth, your confidence, your specialization, and your ability to attract the high-level clients that you can really support well.
It’s time for you to grow!
And guess what? You can change your rates TODAY. I changed mine in a day. I went from charging $25/hr one day to $50/hr the next – because I was able to define who I helped and specifically I helped them – and then I got in touch with those people and signed them. I was aligned with that decision. Of course I got help from my business coach to do it.
And you don’t need to double your rates, but you might be able to if yours are really too low!
The point is you can raise them and get ready to build the business that you really want to have.
Let’s circle back to today’s quote: “You don’t get what you deserve. You get what you tolerate.” Ah yes, Tony Robbins. He’s a lot isn’t he? But in this case he is right.
If you know that your rates are too low, ask yourself: what am I tolerating right now? What is it costing me to stay here? What would change for me if I earned more?
In the next and final episode of this four part rates series, we are going to talk about how to raise your rates without burning bridges, losing clients, or second-guessing yourself.
Because change does not have to be dramatic to work.
Do You Need Help?
If pricing has been coming up for you as you listen to this mini series, then I’m glad you are tuning in today.
Most VAs don’t struggle with rates because they’re doing something wrong. They struggle because their pricing no longer matches the level of work they’re actually doing.
If that’s you, check out my Packages Workshop that I’m running in February.
In this workshop, we’re going to focus on turning your services into clear, confident packages that make pricing easier to communicate and easier for clients to say yes to. This is a hands-on workshop with your actual services – not templates.
Together we will create packages that reflect your experience, set clear work scope and boundaries, and help you stop feeling awkward around price discussions.
If you’re ready for your pricing to feel simpler and more aligned, I’d love to support you inside that workshop.
Check out the details and register here: YourVAMentor.com/va-packages. Or send me a DM and we can chat about it.
That’s all I’ve got for you this week, I’m Tracey D’Aviero, The Confidence Coach for Virtual Assistants. I’ll see you next time!