The Ultimate Guide To Succeeding As A Freelancer | Fora Financial Blog
The Ultimate Guide To Succeeding As A Freelancer
January 23, 2020
The Ultimate Guide To Succeeding As A Freelancer

The Ultimate Guide To Succeeding As A Freelancer

A long time ago, becoming a freelancer was often considered a last-resort option. It was an existence reserved for those unable to secure permanent employment, instead resulting for part time gigs.

However, with the advent of the digital age, that concept has been upended significantly. New research and polling have shown that people worldwide  are increasingly turning to freelance, remote jobs due to the freedom offered.

We’re going to explore the factors that contribute to successful freelancing. Following the tips outlined below will ensure the quality of your job search hinges less on luck and more on what you bring to the table. Freelancing boils down to one thing: freedom. Let’s dig in.

What Is Freelancing?

In effect, a freelancer is someone who works for themselves, as opposed to working for a company. While the ultimate goal of freelancing is to obtain contractual work for businesses, they remain self-employed.

Freelancers are responsible for many things traditional employed team members aren’t. This includes tasks like setting working hours, tracking spent time on projects, client billing, and paying business and employment taxes.

Freelancing means you aren’t considered an employee of the business you’re working with. Instead, you’re referred to as a contractor.

Many terms masquerade as something else, but essentially boil down to freelancing. Contract workers, independent contractors, 1099, contract consultant, contract to hire; these are all freelancers.

The most common sectors that hire freelancers for regular operations include:

  • Computers and information technology (I.T.)
  • Finance and accounting
  • Recruiting and human resources
  • Writing, editing, and proofreading
  • Graphic design, web development, and web design
  • Administrative work, project management, customer service, data entry

However, the skills and abilities of trained freelancers are in demand. This is true in almost any industry globally. This explains the explosive growth of the freelance marketplace over the years.

This trend is not slowing. Nasdaq predicts that 43 percent of the U.S. workforce will be freelancers by 2020. These trends are in line with the data from Upwork and the Freelancers Union for 2019.

Why the migration? According to a PGI study, 82 percent of remote workers and freelancers reported lower stress levels. Also, 80 percent reported experiencing higher morale. This makes sense, as many freelance roles are remote, allowing for flexibility, ease of communication, and the rise of the digital nomad.

However, freelancing comes with its own set of pros and cons. Below, we’ll outline some of the most commonly-faced pros and cons of being a freelancer.

Advantages of Freelancing

  • As a freelancer, you can select the clients you want to work with. Plus, you can work with as many clients as your outreach allows, or as few as your budget can handle.
  • In that vein, freelancers can choose their workload, working as much or as little as you’d like. Plus, project selection can be based on what you’re passionate about, not what someone tells you to work on.
  • Many standard office jobs may seem to provide variety to their employees. However, freelancing opens a new world with extensive projects to tackle.
  • Freelancing also comes with substantial flexibility. Wanting to work full-time in the fall and winter, and spend the spring and summer traveling the world? As a freelancer, you can make this a reality.
  • Freelancer jobs provide independence to do as you wish with your day. You can work where you’re comfortable, without the distractions of everyday office monotony.

Advantages of Freelancing

Potential Disadvantages of Freelancer Work

  • The taxman gets a piece of your income, regardless of freelance or full-time employee status. However, they have a far more significant tax burden to pay.
  • While full-time employment typically guarantees benefits, freelancers rarely receive benefits. As a result, freelancing comes with the disadvantage of finding your own insurance and benefits options.
  • Cultivating a steady workload is one of the most common disadvantages of the freelancer lifestyle. Projects start and fizzle out. Sometimes, clients end contracts earlier than anticipated. There are many challenges associated with finding steady streams of work.
  • By far, the strongest potential disadvantage of freelancing is ensuring the discipline to get the work done. Essentially, you’re running your own small business. Thus, you’re responsible for ensuring everything gets done, even outside the assigned workload. With no management breathing down your neck, the motivation to continue can get daunting.

Nine Ways To Succeed As A Freelancer

Finding your niche as a freelancer doesn’t boil down to a set-in-stone formula. There are many methods to become a successful freelancer and following these tactics will help you ensure success.

1. Love What You Do

Mark Twain once said “find a job you enjoy doing, and you will never have to work a day in your life.”

This is a given. If you don’t enjoy your niche, you’re going to be unhappy. A surprising number of people who leave the corporate world and foray into freelance work quickly realize that it wasn’t the monotony of the scheduling that they disliked. Instead, they didn’t enjoy the work they were doing.

A lack of passion is easy to diagnose. Once you embrace the freelance lifestyle and are working your own hours, there’s a staunch lack of accountability. It’s here where your drive to succeed doing something you love paves your agenda. If you have trouble getting out of bed or dread the workload ahead, it may be time to think about a change of pace.

2. Put A Focus On Your Online Presence

Your methods to sell yourself and your services need to go beyond standard profiles on large networks. By building a brand, you position yourself as a thought leader in your industry. 

Start to build your online presence with a well-designed website. Ensure it’s user-friendly, fast, and doesn’t overwhelm visitors. Remember, this website serves as the public face of your freelance progression. In addition, your website and online presence work to guarantee potential customers can quickly contact you and request services.

For the most substantial results, invest time and capital into a mobile-first design. Fill the website with relevant, educational media, articles, and content. The goal here is to establish yourself and your brand as the pinnacle of expertise in your industry.

Once your website is ready, move on to your social media presence. At first, focus on one network before branching out. Feature your content, interact with other industry  experts, and practice high engagement. It’s important to note that social media is one of the most reliable lead generation sources for freelancers.

3. Diversify Your Income Streams

One of the most common reasons freelancers burnout is a lack of income generated. It’s a fact: freelance work is an ebb and flow lifestyle. This process can be difficult and anxiety-inducing to grow accustomed to.

If you want to ensure a more level, steady income, it’s crucial to diversify your workload and client base. By taking on work from multiple clients of varying sizes, you protect your wallet. This is important because if a significant revenue source dries up, there are fallbacks to work on to maintain healthy finances.

In addition to this, exploring different customer bases is also quite helpful. Doing so assists you in gaining expert knowledge and experience in lucrative new areas in and out of your industry. If you are looking to grow your freelance skills, branching out is critical. Focusing on income diversification is one excellent method to branch outside your comfort zone.

4. Increase Your Marketing Budget

The growth of the Internet over the past three decades has created a new world of marketing opportunities. This has also been the strongest driver of new professionals to the freelancer workforce. 

Still, it’s essential to put effort into marketing your services to differentiate from competitors. Before starting this type of work, it is smart to come up with numerous methods to reach your target audience. A few stellar examples of putting your marketing money where your mouth is include:

  • Attending relevant seminars and trade shows
  • Utilizing pay-per-click advertising on Google, Facebook, etc.
  • Take actionable steps to improve website search engine optimization (SEO).

In addition, most freelancers use social media to network. Social networking will allow you to market yourself to both current and potential customers.

5. Network, Network, Network

Freelancer jobs have plenty of advantages. However, one of the noted downsides involved with freelancing is the lack of socialization. There aren’t long-lasting office buddies and co-workers. No friendships and brainstorming, commiseration, and water cooler talk.

To negate this disadvantage, the self-employed need to focus on networking. Making friends within your industry is an excellent method to cultivate strong bonds.

However, sometimes your niche is so narrow that its challenging to find like-minded freelancers in your area. If this is the case, there are plenty of relevant groups that can be joined online. One reliable resource for finding people sharing the same interests is Reddit. After all, it’s the third most visited website in the U.S.

Networking with fellow freelancers has extensive benefits. Not only can they recommend tools and tactics, but they can also potentially help you find work when times get lean.

Group of People Networking

6. Make Sure You Pay Your Taxes

Profits on self-employed income are taxable. Freelancers have two taxes that need to be paid: self-employment tax and income tax.

  • Self-employment taxes are the combined Medicare and Social Security taxation requirements. Currently, the tax rate for self-employment taxes is 15.3 percent.
  • Income taxes are the state and federal taxes owed on profits made from your business operations. Some states don’t have state taxes.

What differentiates self-employment tax from the Medicare and Social Security taxes paid by full-time employees? When you’re an employee, the employer is expected to pay half of these taxes on your behalf. However, when self-employed, you’re responsible for the full burden of these taxes. 

It needs to be noted that this can lead to a significant tax burden for freelancers. One good way some freelancing professionals handle the potential shock of taxes is by submitting their payments quarterly as estimated taxes

7. Outsource Administrative Tasks

Freelancers bill more hourly when compared to regularly-employed counterparts. This hourly fee, however, must cover much of this professional’s day, which is comprised of non-billable time.

You can’t possibly charge your clients for time spent on extensive administrative tasks. Responding to emails, scheduling out meetings, developing, sending, and filing invoices and more are all non-billable in almost all situations. To remain profitable, freelancers have to increase the value of their on-the-clock time. This helps to account for time lost through administrative work.

In this vein, striving for effectiveness should take necessary steps to minimize the time spent on non-billable tasks. There are extensive accounting tools available to make invoicing a simple process. Other tools handle expense tracking, time management, task planning, project management, and more.

In addition, many times smaller tasks can be outsourced to virtual assistants with ease. Services such as Taskrabbit and FancyHands make this a breeze.

8. Don’t Drown

Yes, it’s crucial as a freelancer to work hard to build your business and client base. However, it’s also a massive oversight if you let your customers control your every waking moment.

For many freelance professionals, their home also serves as their office. As such, you might be tempted to work around the clock to complete tasks and take on additional work. However, responding to clients immediately, regardless of the time, leads to overextension. This also detracts from quality time with family and friends.

By sticking to a schedule that allows for free time, you ensure that your work quality doesn’t suffer. Lack of sleep, lack of focus, and overworking are all rampant issues in the freelancing world.

9. Never Forget Insurance

To remain both profitable and healthy, freelancers should take necessary steps to save for both out-of-pocket medical expenses and relevant insurance.

Some freelancers get away with purchasing only standard, barebones health insurance. However, people suffering from severe illnesses and older freelancers should consider more comprehensive care plans. This includes such options as vision, dental, and short-term disability insurance.

For the strongest and safest results, consider an HSA (health savings account). Invest enough to ensure you are covered, even in months where work may be scarce.

Our Final Thoughts On Freelancing

Freelancing is an incredible option for daily-grind employees looking to take their skills and free themselves from the doldrums of the 9-to-5 life. Your commute can go from an hour each way to a few steps from your bed. You can spend the entire day in your pajamas. Freelancing can let you travel the world and still make a stable income.

However, the self-employed person still needs to stay disciplined. By following the tips above, you will have the best chance of succeeding in this space.

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Fora Financial

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

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Fora Financial is a working capital provider to small business owners nationwide. In addition, the Fora Financial team provides educational information to the small business community through their blog, which covers topics such as business financing, marketing, technology, and much more. If you’d like to see a topic covered on the Fora Financial blog, or want to submit a guest post, please email us at [email protected].