Along with the growing trends of working from home and becoming your boss comes the need for some responsibility that you may not have anticipated. Freelancing is a great way to make money while still working on other side projects, but it also needs extra care and attention to avoid any issues along the way. Also, freelancing allows for a high level of autonomy, flexibility, and ultimately freedom. But with that freedom comes a few extra things you should be aware of before taking the plunge into freelancing.
What You Need to Know:
1. Understand How to Invoice Properly
Invoice creation should be done immediately upon completing your project, no matter how small or large the task is. The best way to do it is to create invoice email templates and send them off when you deliver your finished product. If, for some reason, the client is not responsive to the invoice, follow up with a polite email and gently remind them that payment needs to be sent over. It may seem like an inconvenience, but it’s well worth it if they end up paying what’s due. Don’t leave this until the very last minute because it can be challenging to keep track of all your invoices if they’re spread over a long time. It also looks unprofessional to have old unpaid invoices lying around as well.
2. Keep a Record of Your Work
Just because you’re freelancing doesn’t mean that you can slack off your work ethic. On the contrary, it’s more important than ever to track and document every step of your progress. This also goes for invoicing. Make sure to record when each invoice is sent, when it’s due, and whether or not it has been paid. This information will come in handy should any disagreements, or payment disputes arise down the road. Additionally, if you’re ever audited by the IRS (and as a freelancer, you likely will be at some point), having a documented record of your work is an essential part of your case.
3. Have Multiple Sources of Income
It’s no fun relying on one client for all your income. But freelancing can have the same effect, so it’s essential to always look ahead to prevent any hiccups along the way. There are many different ways to keep up a steady flow of income as a freelancer. Find good contracts that you’re happy with, diversify your work portfolio, and even think about branching out into different fields if you feel you’re being pigeon-holed into something too specific.
Even better – try creating multiple sources of income through various projects or maintaining several clients at once. This may take more time to complete all your tasks effectively, but it keeps things exciting and gives you some wiggle room if anything goes wrong with one of your clients.
4. Look Out for Scams
There will always be people looking to take advantage of freelancers, especially if they’re new and don’t have a lot of reviews online yet. Never send money or personal information over to anyone who contacted you through an email or text message without receiving anything in return first. This is more than likely some scam. A client may also ask you to sign an NDA (Non-Disclosure Agreement), which prohibits you from sharing any private information about the project at hand – do not sign this until all conditions are agreed upon in writing. Otherwise, it’s worthless when disputes arise later on down the line.
5. Work Ethic is More Important Than Ever
Just because you’re a freelancer doesn’t mean that you can ignore your work ethic. It’s even more important to maintain a good one to build up a good reputation for yourself and keep clients coming back for projects in the future. This means that you need to be self-motivated and have a strong work ethic to get things done. There’s no one there to push you along or tell you what to do – it’s all on you. This can be a difficult hurdle for some people, but freelancing can be incredibly rewarding if you can manage it.
If you decide to take on multiple jobs at once, make sure each task is planned out accordingly, so everything is done correctly with no mistakes down the line. This also applies to invoicing – make time immediately after completing a project or task to prepare your documentation and send out invoices as soon as possible.
6. Set Yourself Up for Future Success
To be successful as a freelancer, one must always look ahead and plan how they want to expand their business in the future. What is your end goal? Where do you see yourself in 5 years? This is especially important during tax when it’s time to file for deductions. It’s best to have all of this information to maximize your deductions and save as much money as possible. Also, starting with a good accountant will be incredibly helpful down the line should anything go wrong or if you ever need help with filing taxes.
7. You Need To Create a Structure for Yourself
Working as a freelancer can be incredibly liberating, but it also has its own set of challenges. One of the main ones is creating a structure for yourself, so you’re not just working aimlessly day in and day out. This may include setting specific hours during which you will work, dividing tasks into particular days of the week, or even setting goals you want to achieve each month/year. This means organizing your days and imposing strict time limits for yourself. When deadlines are involved (and they will likely be), make sure to create a schedule ahead of time so that everything gets done on time without any hiccups or stalling behavior.
Being a freelancer is an excellent opportunity for those looking to branch out on their own and explore new areas of interest. It comes with many perks – flexibility, the ability to set your prices, and more. But there can also be complications down the line which makes maintaining these benefits difficult. All of the challenges you’ll face along the way are difficult, but they’re all worth it when you start getting paid for doing something that you love. So keep these tidbits in mind as you begin freelancing, and soon enough, everything will be running smoothly.