9 Tips for Transitioning to Freelance Life
When Freelance Projects Become Fulltime
More than 50 million Americans have already transitioned to freelance life. We’re only beginning to see the change: by 2020, projections indicate that nearly half of the US workforce will be independent, up from the 30% or so that it is today. The world is going independent. How about you?
Here are 9 tips to consider when making the leap to freelance life.
1. Prepare to Work Hard
The first step in your transition to freelance is getting over the myth that freelancers don’t work as hard or as long as workers in the traditional workforce. In fact, as an independent professional you may need to work more hours than an employee who works the usual 9-5, especially up front as you build your client base and solidify your process. You’ll need to source your own work, manage your business’s finances, and follow through on deadlines that will take careful planning and a whole lot of work.
Before you begin freelancing, you need to realize that you’ll have to adopt a new mindset. No boss is going to hold you accountable. No one is going to line up work for you. When you’re starting out, you’re not going to have stable work. Rather, it will be your job to build a sustainable, stable business.
2. Do Work Upfront
You can’t just wake up and decide you want to start freelancing. You’ll need to make contacts and find work before you can commit to life as an independent professional. This may mean having an overly busy schedule the first few months, but it will be worth it in the end. You can manage your time and keep track of contacts with a note-taking app like Evernote.
While you’re making connections and reaching out to contacts, determine where you can find work. For example, WorkMarket connects freelancers with the companies that seek them. By using WorkMarket’s platform effectively, work will come to you.
You might also consider creating a personal brand. Take the time to fill out your social media profiles. Have a designer friend make you a logo. Build a website, or hire someone to build your website. Go to meetups.
3. Don’t Even Think About Skipping the Planning
There are many factors to running a business. You can’t just quit your job and expect work to fall in your lap. You’ll need to consider financials carefully. Write up a business plan and check with friends to see if it seems viable.
Determine your survival limit. How many projects do you need to take on to make enough money to live comfortable? Once you know that number, you can calculate the price you should charge and the number of clients you need to make it work.
Another tip: learn how to negotiate. Try to find a mentor to help you. The better you are at negotiation, the more money you’ll make
Do market research. Find out if anyone else does what you do. If you have competitors, find out how you can stand out and steal your competitor’s business. If you don’t have competitors, how are you going to find potential clients? How are you going to create a market around what you do?
4. Connect with Other Freelancers
Finally, meet other people who have done it already. The best way to learn to do something is to watch someone else do it. You’ll have to wear multiple hats, which means it’s likely that you’ll come across something that you don’t know how to do.
Do you know how to get access to health care? Do you know everything there is to know about the tax code? Can you build your own website? Are you a designer? Where can you get business cards made?
Once you’ve connected with members of your community, these immediately become easier problems to solve.
5. Adopt The Mindset
Independent work functions differently than “full-time” employment. For one, many independent workers find they work more hours than they did during a typical 9-5, so the notion that “full-time” employees have more work isn’t necessarily accurate.
The nature of the work is different. As an employee, you typically have a directive and role within a larger business. As an independent worker, you are your business. This requires a shift in approach and mindset: no longer can you expect a manager to put work in your lap when you wake up in the morning.
You need to spend time finding work that matches your skills and interest, manage the process for securing that work, as well as actually do the work. Going independent requires declaring to yourself, “I am an independent worker.” And then, start acting like it. The rest are mechanics.
6. Be The Product
You are the product, so market yourself appropriately. Be available. People tend to prefer to work with those who are responsive and communicative. Especially when starting out, make sure you’re available by phone and email as clients will shop around.
Cultural expectations about dress code differ across industries; but, there are a few truisms that hold true for any freelancer looking to market themselves as a trustworthy and high-value resource. Look the part. Get yourself some nicely printed business cards and/or its online equivalent. Wear clothes appropriate for the work you’re doing. Investing in how you look pays huge dividends.
Remember: you are the product. Make people want to buy you.
7. Make It Legal
Depending on your business, there may be licenses, permits, and other legal considerations with regard to your candidacy as a freelancer. You can check with the Small Business Association to check to see if you need a license or other certification.
Further, you may also consider opening up a separate company (often an S-Corp or LLC) to organize your freelance business. The Freelancers Union offers some great resources for obtaining any legal advice you might need.
8. Heed The Tax Code
If you’re new to self-employment or 1099-type income, take a moment to learn about taxes. Again, the SBA provides an overview of these new tax realities (practically speaking, this means paying your quarterly estimates).
Per the previous step, having a separate company can make quarter-end accounting quick and painless. Speaking of accounting…
9. Budget Accordingly
While you’re getting your business running and have a few extra cycles, use your extra capacity to learn good accounting habits. Not only will it come in handy come tax time (which, for you, will be four times a year), but it will help you keep track of how your business is growing, how much you can afford to pay yourself and avoid making financial mistakes that could cost you big down the road.
Building a client roster can be incredibly rewarding, but it can also take a bit of time. Having a good handle on your budgets and how much you need to earn can alleviate some of the initial stress of getting up-and-running.
As mentioned above, freelance life offers much flexibility but equal responsibility. The quick-steps above will help you get started on a successful transition, but they are by no means the be-all/end-all. Sometimes, getting started is as simple as giving yourself permission to get started. You will learn as you go. Mistakes will happen and you will adjust. If you think the freelance life is right for you, give it a try.
(In case you need a further nudge, dip your toe in: sign up for WorkMarket and see what companies are looking for you.)