How much should you charge?
One of the most highly discussed and controversial topics among independent online ESL tutors is how much to charge for your classes. There is no simple answer unfortunately! In this lesson, we will focus on this from your perspective – what factors do you need to consider when deciding on your ideal price. In the next lesson, we will take the parents’ perspective, before moving on to consider how you can better frame your value proposition to charge higher prices.
Time required outside of lessons
I have heard teachers say that as long as they are earning the same salary as their previous ESL employer was paying then they were happy. However, this is not considering the fact that these companies did a LOT for teachers which greatly reduced the work you had to do outside of lesson time. Examples of additional time-consuming tasks independent teachers should factor into their pricing include:
- Lesson planning (particularly if you are not using a set curriculum but instead creating your own, customised lessons)
- Preparing supplementary materials (vocabulary flashcards, props, homework sheets, etc)
- Marketing time (ok, this is not necessarily adding value to your learners, but it is a time you have to spend on your business)
- Admin time (messaging with parents, arranging lesson times, sending payments, writing lesson feedback, etc)
- Marking and feedback time (if you are marking students’ homework)
If you add up these additional hours, you may find that a short 25-minute class actually requires one or even two hours of actual working time. You might therefore want to take the approach of multiplying your desired hourly rate by the actual working hours in order to calculate an appropriate price for your class.
Additional costs incurred
As an independent teacher, you also have significant additional costs. These include:
- International transaction fees on customers’ payments (almost all payment platforms charge these to you, not to the customer)
- Professional curriculum resources such as the Abridge Academy resources
- Online teaching software (e.g. Zoom or ClassIn – the free versions are usually “good enough” but the paid versions have some useful extra features)
- Technology such as your computer, headset/ microphone, webcam, etc. and internet fees
- Marketing costs (particularly if you are doing any paid marketing or offering referral discounts/ commission)
In general, the more students you have the lower the costs incurred per student. However, it is still important to factor these costs in along with your predicted number of students when putting together your pricing plans.
Your own financial goals/ needs
Ultimately, you are the person who decides how much you want to charge. You should also consider your own financial goals and needs. Is tutoring just a side-job for you or do you want to be a full-time online ESL teacher? What other income streams do you or your family have? What important bills do you need to be able to cover? How much could you earn in alternative jobs you are considering, or by tutoring students locally?
It is important to make a rational decision considering your personal circumstances in order to not undervalue yourself and risk financial troubles.
Task: Taking into account the considerations above, consider how much you would like to charge to your customers in order to make teaching online worthwhile to you. What do you think would be a reasonable fee for parents to pay, and what key reasons support you charging this price? If you feel comfortable doing so, please feel free to share your thoughts in the comments below.