A 6-figure freelancer shares strategies for reducing and eliminating Upwork fees
Upwork is a great place to find freelance jobs online and make money. I’ve personally made over $600,000 as a freelance graphic designer on the platform. However, despite being a living testimonial to the power of Upwork, would-be users continue to voice concerns about Upwork fees. But there are ways to ways to reduce or avoid fees altogether, like earning free Connects and utilizing Direct Contracts, for instance.
And, as you can see from my profile, I’ve utilized these fee-reducing strategies myself to earn a small fortune on the platform. Today, I make six figures a year and charge an hourly rate of $150+ on the platform. In this article, I’ll share how I earn a living on Upwork while minimizing fees.
Freelancers can avoid Upwork fees by earning free Connects, avoiding Freelancer Plus, using the BYOC program, utilizing referrals, using Direct Contracts and legally taking their clients off the platform using the conversion method. Clients can avoid fees by not boosting their job posts, paying with ACH and de-platforming their freelancer (the right way).
IN THIS ARTICLE
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How much does Upwork take?
Upwork’s base service is free. However, there are three ways that Upwork makes money off of its freelancers:
- Upwork Connects: Upwork asks their freelancers to use something called “Connects” (a form of digital currency) to bid on jobs and buy boosts. Connects cost $0.15 each. The average job will require about 8 Connects to apply.
- Upwork Service Fees: Upwork charges freelancers a flat 10% service fee on all on-platform earnings and invoices. This includes hourly contracts, fixed-price contracts, project catalog listings, and contracts with Enterprise clients.
- Premium Subscriptions: Freelancers may choose to upgrade to a premium Freelancer Plus subscription, for $20/month
The Upwork Fee Structure
Upwork freelancer fees
|Freelancer service fee
|10% on all earnings
|Freelancer Plus (optional)
Clients are charged an initiation fee of up to $9.95 for each new contract they create. And, when it’s time to pay the freelancer they’ve hired, they will incur a small payment processing fee of 3-5%. Clients may also choose to boost their job posting when hiring for $29.99.
To be clear, “transactions” include; contracts initiated on the freelancer marketplace, fixed-rate and hourly projects, milestones, catalog projects, the Bring Your Own Client program, bonus payouts and expense payouts. The same fees apply to Enterprise contracts.
Upwork client fees
|1x initiation fee (per contract)
|ACH transaction (eligible U.S. clients)
|3% per transaction
|5% per transaction
|Credit card transaction
|5% per transaction
|Job Post Boosts
How to avoid Upwork fees (for freelancers)
1. Earn free Connects
There are various ways to earn free Connects, which normally cost $0.15 each. Upwork gives new users 50 free Connects upon creating their first profile. You’ll also earn 10 free Connects each month just for joining. You can also earn 30 free Connects by earning the Rising Talent Badge. Additionally, you can earn free Connects every time you win an interview with an established client (clients with previous freelance hires) on Upwork. Finally, you earn a one-time Connect bonus for completing an Upwork Skill Certification (currently invite-only).
2. Avoid Freelancer Plus
I suggest avoiding the urge to subscribe to the premium Freelancer Plus membership ($20/mo). The biggest benefit to this service is the 100 Connects you’ll receive each month instead of the usual 10. But if you just bought those 90 additional Connects separately for $0.15 each it would only cost $13.50. The other benefits, like access to an AI-powered chatbot and keeping your earnings private (which isn’t recommended anyway) just aren’t worth it, in my opinion.
3. Use the BYOC program
Use the Bring Your Own Client (BYOC) to Upwork program to avoid the 10% Upwork service charge altogether. This program is available to any freelancer who has, at a minimum, achieved the Rising Talent designation. Just reach out to customer service and ask for a personal BYO Contract referral link to send to a prospective off-platform client. After your client successfully signs up for a new account and invites you to the job, upon your acceptance, simply email BringYourClient@upwork.com with the contract number. Upwork customer service will handle the rest. And voila, you’re 10% service fee goes down to 0%.
4. Utilize referrals
Over time, you can avoid needing Connects altogether by relying on referrals rather than applying for jobs. At the end of each engagement, I always ask my clients to keep me in mind for future projects and referrals. This trick works astonishingly well as it promotes long-term contracts. Happy clients will keep coming back for more and gladly refer you to their friends and other business associates who can simply invite you to jobs directly which will eventually end your reliance on the Jobs Feed and the time-consuming proposal process.
5. Use Direct Contracts
You can also reduce that 10% service charge to just 3.4% by utilizing Direct Contracts. With Direct Contracts, you can create and send proposals to clients who don’t have Upwork accounts. But just like a regular Upwork contract, your client’s funds go into the Upwork escrow, mitigating the risk of potential disputes.
6. Take your client off the platform
Did you know that it is completely legal to take your clients off the platform after two years without violating the Upwork Terms of Service or having to pay a massive Conversion Fee? Upwork calls this process “Contract Conversion”. Simply have your client contact customer service and give them the contract number for the job you wish to convert. Note: There will still be a $1 conversion fee and you will want to wait out the full two-year requirement. If you attempt to take a client off of the platform before the two-year mark, Upwork retains the right to issue a suspension.
How to avoid Upwork fees (for clients)
1. Pay with ACH
Clients based in the United States who opt to pay via ACH can reduce their 5% service fee to just 3% per transaction.
2. Do not boost your job posts
At the time of this writing, clients can optionally boost their job posts for $29.99. I firmly believe this is a waste of money. And I am not alone in that opinion as you can see from the Upwork forums. Trust me, you’ll receive plenty of proposals regardless of whether or not you pay for this boost.
3. Deplatform your freelancer
As I mentioned earlier, it’s completely legal to take your freelancer/client relationship off the platform after two years for a $1 conversion fee as long as the client initiates. To initiate a deplatforming, simply contact customer service and give them the contract number in question. Confirm it meets the requirements for the reduced conversion fee before proceeding.
What do you think about online platforms like Upwork charging a transaction fee? Has the fee structure prevented you from trying Upwork in the past? Let me know in the comments and don’t forget to connect with me on social media using the links below.
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