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Thinking of freelancing? Here are some things to think about before you take the plunge.
If you have a few years of experience in your field, you might be considering joining the UK’s two million freelancers as a way of enjoying flexibility and a better work life balance. Lots of careers in the UK lend themselves to freelancing, including IT, marketing, journalism, recruitment, project management, copy-writing, video, web design, law and many other professions.
It’s a really appealing option to many, as many freelancers have a more flexible working style. They can often be home-based and able to work around childcare or other caring responsibilities. Freelancing can also give you more control of the hours you work.
Here’s what to consider if you want to become a freelancer.
Be aware that a start-up freelancer often has to wait a while for the money to start coming in. You’ll probably need time to find your first clients, and then have to wait a month or two for each invoice to be paid.
Freelancers usually charge by the day. The fee is more than they would receive in full time employment, because they have to cover sickness, holiday and quiet times in their fees.
Many people hold off from launching their freelance business until they have saved enough to cover a few months of no income. It’s also common to make the move after a redundancy payment.
Remember too that it can be more difficult to get a mortgage as a freelancer. You’ll often need a couple of years’ accounts to secure a mortgage deal. Bear that in mind if you’re looking to buy a home or your mortgage is up for renewal.
An accountant will help you navigate the options of working for yourself, such as whether you need to set up a limited company or register for VAT. They can guide you on how to decide what your daily rate should be.
You’ll also need a finance system. It’s common today to use an online cloud accounting package to manage your invoicing and tax – your accountant then accesses the details to create your accounts.
You should also look into the insurance you might need, such as professional indemnity cover, which is often required in client contracts.
Some freelancers can walk into work pretty quickly through their existing contacts. But if you need to start from scratch, finding freelance jobs takes some focus and planning. Are you clear about who your target audience is and what you have to offer them? Some freelancers spend time creating a brand and company name, especially in the more creative fields.
You’ll almost certainly need a website to attract potential clients. This doesn’t have to be complicated, though. There are lots of online web tools that help you create a simple website, or you could work with an agency to create something appealing but budget-friendly.
Once you have a clear proposition and a website, work on a plan to reach your audience. Consider direct email, LinkedIn and other social channels, or local advertising and relevant business events. There are also freelancing websites for many types of work, which are well worth a bit of research.
Freelancing requires a different outlook to normal employment. You’ll often find that you need to say yes to everything. Even veteran freelancers find it hard to turn work down, in case it prevents a client returning in future. While a job might not pay what you were hoping for, it could lead on to other things. So find reasons to say yes instead of ways to say no.
Plus, your network has never been more important. List out people you’ve worked with in the past, plus friends, family and other contacts that might be able to help you or recommend you. Chat to other parents about their jobs: many a business relationship has started at kids’ ballet or school pick-up.
The unpredictability of freelancing can put many people off. For freelancers, having a reliable monthly income is a thing of the past. They often find that work is ‘feast or famine’ – where a very busy period is followed by a quiet spell. Experience will help you get used to this, so that you can seize the opportunity of a downturn to get fitter, spend more time with the children and generally have a breather.
Most freelancers say they never look back. Being your own boss is empowering, rewarding, and often more lucrative than permanent employment. Enjoy the ride!