Freelancing 101 – The Basics
So you wanted to become a Freelancer. That’s great! You’re one step closer to more personal freedom and a job you actually enjoy. Here are a couple of things to keep in mind – things I found important to consider when I began freelancing. Of course there are many more, so feel free to add your thoughts in the comments section.
Your finances are the most important issue to consider when starting out. You’re probably used to getting a pay-check by the end of the week/month/year. Not having that is what many people are afraid of when embarking on their freelancing career. Luckily, you will get used to this pretty quickly. You just have to approach your finances differently. The most important thing is to always have enough money in your bank account to allow you to live for the next couple of months, even when it seems the work is rolling in.
Taxes are an important part of accounting that many overlook in the early days. It’s tempting to spend all the money you get, but it’s important to keep in mind that someday the tax office will want its part of your income.
In order to avoid being trapped in the pitfalls of your tax system, I highly recommend getting an accountant. It’s generally not too expensive and allows you to focus on what you’re good at. At the beginning of every month I collect my bills, drop them off at my accountant’s and wait for her to tell me how much I have to transfer to the tax office.
However, it is possible to take care of your finances without the help of an accountant. If you have the time to spend on your accounts (and a mind that bends well to these things) you can have a far greater control and insight into your financial situation. The most important thing is to be realistic – if you know you’re not the accounting type, get an accountant straight away. Hiring an accountant at the beginning of your freelancing career will be far less expensive in the long run than fines from the tax department and hiring someone to sort out your abysmal records.
There’s been a lot of coverage on this issue here on FreelanceSwitch, so I’m going to keep it short. The first thing I looked for, even before I registered myself as a freelancer, was an office. While I enjoy working from home, I prefer to have a place where I can focus solely on work. If you can devote yourself to your work at home, then great! But if like may of us you find this impossible, look for a place in a shared freelancer office or get your own. I’m sharing mine with two other freelancers. Though I like a quiet atmosphere, I also like to have people around and this setup is the perfect arrangement for me.
As a freelancer, your portfolio represents you and your work. If you’re a software developer like me that means always having a profile at hand. It features your last projects, what technologies, programming languages and tools you’re fluent in, and your educational history. How much you put in here is up to you, I have just one recommendation: Don’t lie in your resume. Don’t mention things you didn’t do, don’t know how to handle or worse, things you know are fashionable but know nothing about.
The work you’ve done in the past speaks for itself. If you already worked on several projects, know your way around in several programming languages, there’s no need to lie. The more you already know, the easier it usually is to learn new things. If a client asks for a specific technology that’s not yet on your resume, either show the willingness to learn, or pass. That’s something to get used to. It’s tempting to say yes to every job you’re offered, but in the end it might result in a disappointment for both you and your client.
Care for your portfolio, improve it, and learn new things on your own time.
A lot of freelancers live by the rule that holidays are to be treated as rare events. Work is important for sure, but I already paid my dues working too much some years ago. For me it’s not worth it to work without taking time off. The myth is that clients expect you to work by their schedule. While that can be true of some projects, it’s important to have your own schedule too. Plan your holidays, at least the time frame, in advance and inform your current and potential clients about it when the project schedule is discussed.
Personally I need an extended holiday every once a while, time to get away from the computer, get away from the stuff happening in the world of software development, time to get new ideas, regain strength and to read. I think of it as recharging my batteries. Your clients go on holidays, so there’s no need to feel bad about going yourself, as long as you give them warning.
Though I shut off most of my communication channels when I’m away, I try to answer emails of potential clients once a week (a nice way to fill in the time it takes to upload your photos on Flickr). On my last trip most potential clients were understanding that I was on the other side of the world at that moment and I’d get back to them as soon as I’d returned home. I’m working for one of them at the moment.
Avoiding holidays is also related to another issue:
Everyone feels the fear at some point: The fear of not having money coming into your bank account for a long time, or of not having work for a while. Whether you’re on holidays or work’s been scarce, there’s no income coming in.
In my early days freelancing I panicked. But there’s no need to, at least in the short run. It’s a situation you have to get used to. Though it’s tempting to work your ass off to ensure a constant flow of money, you have to ask yourself if it’s really worth it and if you want to do that to your body.
Prepare in advance for situations like this. Budget to have enough money in your account to get through a dry spell or a holiday. Have a list at hand of things that you’ve always wanted to do. Quiet spells can be used for these things, or to learn new technologies, different techniques to approach certain problems, and the like. The important thing is avoid slacking off when you know you have the time at hand. Don’t fall into the habit of postponing things you could do in periods without gigs.
It’s far easier and less stressful to confront the fear with a game plan than to give into it. Of course it’s normal to worry about money, but there’s no need to panic and to drain your batteries with excessive work. You wanted to become a freelancer because you wanted freedom, remember? So use your quiet times to develop yourself instead of stressing out. Hopefully you’ll find yourself better equipped when that new job comes along!