That is a very low rate by US/EU standard, but it doesn't surprise me as an Argentinian rate. Indeed, many Argentine translators omit to live in Argentina because it is like saying "living in India" and thus they are offered only low paying job. Also, many translation agencies have their HQ in the US (because it adds to their reputation) but then they have operative offices in Central-South America (or Eastern Europe if based in the EU) to keep costs low... guess how much they are willing to pay their freelance linguists...
Google for "trabajo traducción" in Buenos Aires and you'll see job ads for translators/PMs at 4000 ARS per month. :huh: <_<
Anyway, your rate should depend on the complexity of the subject, your experience, your language pair, etc. *You* should be the one setting the rates, not them. There is plenty of agencies throughout the world. Some are low end, others stay in the middle, and just a few are top notch. For freelancers it is very hard to stand out in the global crowd. There are good translators working for peanuts, agencies exploiting them, etc.
Avoid like a plague those "online agencies" where you register and bid for a job. They are looking for cheap translators, exclusively.
Don't fall for traps such as endless test translations, or agencies "forcing" you to accept low rates in exchange for a "preferential" treatment over other linguists.
Some agencies hire also a proofreader afterward, so your rate should reflect this. In case you are dealing with direct clients, it is advisable to hire yourself a proofreader to ensure a flawless job. In this case, quote considering the proofreader's rate, as well.
Set your rate based on the amount of words you are able to translate per day, consider that it is unlikely that you will be working 8 hours a day, Mon-Fri, especially at the beginning.
On average, translators can translate 2000-2500 words per day. How much do you need to earn to live comfortable in a month? Divide by the working hours you are able to work in a month and that's your hourly rate. Test yourself and calculate how many words per hour you can translate.
I have different rates according to the kind of agency - do they take care of proofreading as well? - is the text very technical? - what is the turnaround requested?
However USD 0.06/source word is very low by any means. Try to start from USD0.09/source word as a minimum for very basic stuff (like greeting letters).
Almost all agencies will try to rebate your rate, so don't tell first USD0.09 or you'll settle for less than that - let them think they are getting a good deal!
Try to reach specialized agencies (i.e. legal, medical, technical, creative) depending on your skills/background, they usually value good translators more than regular agencies.
Know your assets and your limits, learn to use CATs for your own good, don't fall for cheap agencies playing tricks to lower your fee (odd discounts for fuzzy matches, false fuzzy matches against a TM not relevant for you job, excessive demands for little money in exchange, etc.), avoid agencies in India, China, Italy, Africa, etc.
The last one I heard was: "You will be paid at 60 days, but we can pay you at 30 days, instead, by deducting 3.5% of your invoice".
Good luck!