Working-age individuals have two options as to how they can pursue their careers. They can either opt to be employees, professionally linked to a specific organization, or freelance and work for multiple clients.
The upside of an employment agreement is that you get legally mandated benefits. The downside is you have limited flexibility in terms of how you do your job. That’s one of the primary reasons why many choose to go freelance. They value the freedom afforded to them by the setup.
However, it’s worth noting that working freelance is not as easy as most people think. It has its own challenges; in fact, even seasoned freelancers still go through a rough patch. Now, if you’re a freelancing newbie, those setbacks might be even more pronounced. That’s why there are essential preparations to make. To commence your freelancing career the right way, here’s what you need to know.
Figure out which classification you fall under
The first order of business is to answer why you want to become a freelancer. Is it something you want to do as a side hustle or a career choice you want to dive into full-time? If you choose the former, you’d want to hold onto your current full-time employment. If the latter’s the direction you want to take, you’ll have to sever ties with the company you work for now.
Both routes have pros and cons. Being a part-time freelancer might be too demanding time-wise, but you at least have your employment income to depend on for times when you don’t have clients on the side. Meanwhile, being a full-time freelancer means you’ll have total freedom to take your career where you want it to go, although that happens without the safety net of a monthly salary.
Choose a skill you’re confident in
Again, there are multiple routes you could take when it comes to the skills you want to tout as a freelancer. You can choose to rely on skills from your previous or current (for part-time freelancers) job.
You can also find freelance work outside of your previous or current job description or entirely go against the grain and find gigs using your hobbies, passions, or self-taught skills. You can even do all three if you’re an accomplished multitasker who knows how to compartmentalize.
If your main objective is to earn as much money as possible from freelancing, prioritize skills that pay the most. Meanwhile, if your priority is self-actualization, you might want to champion your hobbies and passions and find a way to earn from them. Either way, you need to ensure you’ll get a steady stream of income from your choice.
Research about the industry
This is closely linked to the previous item. The best approach is to list down all your skills, from those you use in your previous or current job to the ones you learned yourself, as well as the passions and hobbies you’re inclined to.
Narrow down the list to a few items you want to pursue most seriously. Next, conduct market research. For example, if you do a lot of admin work in your previous or current job and decide to freelance as a virtual assistant, learn how much VAs are getting paid these days. Know the scope of the job required of them.
Meanwhile, if you want to shift to an entirely different career path—for instance, as a freelance graphic artist—you can go to websites such as PayScale, Glassdoor, and Salary to know whether there’s still room for you in the industry, among other things.
Working freelance does not mean you’re off the hook legality-wise. You’re basically the owner and operator of your own business where you sell your skills and talents. With that said, you need to have your business registered; often, a sole proprietorship (SP) registration is sufficient. That is unless you’ll be working with another professional for the long haul.
Having your independent contractor business registered affords you a sense of legitimacy. If a client asks you for any legal document, you’ll have something to show them. They won’t think twice about hiring you, knowing you’re recognized by authorities. They’ll think there’s little chance they’ll get fleeced, given it’ll be easy to run after you should you do so.
Another benefit of getting your gig registered is the freelance tax advantages you’ll get.
Know how to be tax compliant
Speaking of tax advantages, please know that freelancers are legally liable to report their income and pay corresponding taxes, too. The same rules that apply to employed workers will apply to you. If your income within a fiscal year does not reach the taxable threshold, you won’t be paying any taxes. Still, you need to file your return every year. To ensure utmost tax compliance, you may outsource the job.
Expand your network
There’s a grain of truth when they say that freelancers ought to be social beings. You need to put yourself out there and maximize every professional network you build. That is if you want to get the ideal number of clients for you.
You need top-notch network skills. This skill set requires competencies in communication, rapport building, and follow-up. Get your business cards ready and give them away to the right people. Take care of the people you do business with, so they’ll be more than happy to refer you to other potential clients.
Set your rates
Earlier, we mentioned websites where you can check details regarding a specific job market. From those websites, you’ll see the average rates for particular gigs.
You do not need to comply with what’s average. Feel free to set the rate you feel you deserve. That’s most crucial if you know that you’ve put in enough work and time to hone your skills set and you have a portfolio to show for it. Or, if not a portfolio, a list of satisfied clients. Do not sell yourself short, but don’t demand too high a price either. Both won’t work in your favor.
Employees get to enjoy the resources they need to do their job from the company they work for. That’s a legal mandate, and any organization that fails to adhere to it will be in trouble.
As for a freelancer, you’re personally responsible for providing whatever you need to deliver the work output expected from you. That is unless your client specifically agreed via a written contract that they would furnish you with resources.
With that said, have a reliable computer and an equally reliable internet connection. Get yourself health insurance, too. That way, should you get sick, you’ll be covered and won’t have to deplete your savings.
Define your goals
Just because you’re working as a freelancer does not mean your mantra can be anything goes. It’s your career on the line, after all. Ideally, you want to make progress that you can track. Stick with a SMART objective.
SMART stands for Specific, Measurable, Achievable, Realistic, and Timebound. With SMART goals, you know what your targets are and how to gauge whether you’re on the way to succeeding. If you feel like the goal’s lagging schedule-wise, you can adjust your work habits to keep pace with the deadline.
Define your ideal clients
As a freelancer, it’s easy to get tempted to accept gigs regardless of who the client is. This is most true for freelancing newbies who don’t have much freedom to choose work since they still have a limited network.
However, at some point in your journey as a freelancer, you need to reach the level of confidence where declining a client is possible. There could be several reasons you’d want to do so; for example, your values don’t align with that of a client, and that’s enough reason. Here, the key is to recognize the kind of clients you want to work for.
Freelance work is still a lot of work
There are many contributors to the rise of freelancers. There’s the prevalence of offshore staffing, giving all kinds of professionals the power to choose jobs and clients regardless of their location.
There’s also the global pandemic that resulted in many losing their full-time jobs but needing a new source of income. Some also reevaluated their lives and opted to focus on work-life balance by eschewing full-time employment.
Whatever your reason is for freelancing, you have to consider the decision in earnest. You cannot just wing it. Unless finances are the least of your concerns, you need to ascertain that you will not only thrive but succeed as a freelancer. To help you get started on that goal, keep in mind the knowledge imparted in this list.