Or, more to the point, are you covering all your business expenses?
It’s exciting running your own business but scary too. As a legal entity, a business owner, you do have responsibilities you need to cover yourself for, when being a VA, working from home, or in a corporate office somewhere. Expenses you need to include, when considering the rates you will charge include: taxes (and possibly GST too), insurances (business equipment, trauma, income protection, possibly professional indemnity, etc), Superannuation, and put away some for annual leave. Perhaps even the running of your car if you visit clients regularly and go to business meetings.
Then there’s the cost of upgrading your computer every 2-4 years, your software, ensuring you have suitable office furniture and equipment. And what about training, professional memberships (like being a member of AVAA 🙂 ), business registration, and so on?
As at 18 July 2015, the average wage rate for an administrative assistant in Australia was $20.22 per hour. This means that a company employing an admin assistant still have to add on top of that rate: taxes, Superannuation, WorkCover, any other insurances and sick and annual leave as well. A VA here in Australia should be considering all their annual costs when looking at working out their hourly basic rate. If you’re not covering your costs, then there’s no point in being in business – you might as well go back to being in a job.
I recently wrote to a potential client who was querying the cost of engaging a VA here in Australia. I explained that rates are not only based on experience but also on the cost of living. Apart from the things I’ve listed above, there is also your household costs, food, clothing, and all other general every day living costs. It could be well expected that a VA in Sydney, with the same amount of experience as one in Adelaide would be charging a higher hourly rate, simply because their cost of living is higher.
We’ve put together a calculator to give both VAs and their clients alike, an idea of the costs and savings of engaging a VA here in Australia.
We’ve also put together a calculator to help VAs work out rates that are right for them here in Australia.
By the way, there is no legislated rate for the VA industry. It’s a global industry and VAs the world over have varying background experience, capabilities and offer many different services. They also work with different currencies and different costs of living. VAs work out rates that are right for them but also based on what they believe is the going rate for the particular service offerings they provide.
Article by: Kathie M. Thomas