I’ve been freelancing for a few years now and I can honestly say it’s one of the best decisions I’ve ever made. The freedom to choose my schedule, not have to answer to a boss, and work out of the home office (cutting out that dreadful commute) has changed everything.
But there are some drawbacks.
Since you’re not actively waking up, getting ready, and heading into work, you begin to forget about some of the little nuances of the day. Some of these things deal with your personal life while others happen to affect the business.
What I’d like to do is share a little list of things that are easy to omit as part of your normal routine when freelancing. These are the type of items others would have handled in a regular work environment but are now on your shoulders since you’re the boss.
Let’s start …
Developing a “Lazy Day” Plan
I call them “lazy days” not because you don’t have work to do but because you’re so proficient that you run out of things to do that day. When these days begin to happen time and time again, you’ll want to find more clients to fill the time but, then again, you don’t always want to be overloaded especially if you’d like to work on personal projects.
It’s easy to become consumed by the feeling that you need to work, work, work, but slow down … it’s also important to play. These lazy days are perfect for picking up some much needed motivation.
I would suggest that you create a file that lists activities and projects that give you inspiration. These are your passion projects. The ones that revitalize your work and recharge your batteries. It’ll keep you active during the down times and sharpen your skills when you’re not being challenged by a deadline.
You Need a Financial Contingency Plan
The first time you do your taxes as a full-time freelancer you may be a little shocked at the results after submitting your information. Now that you’re on your own, you can see your tax rates almost double because you have to cover all the costs (compared to the company paying into some of it).
You can get so wrapped up in your projects that you forget the basics like:
· Health insurance
· Emergency savings
When something goes awry you may fall back on your credit card. If you suddenly stop receiving payments from clients you could be facing some serious, mounting debt.
Put a plan in place for mishaps:
· Learn how to invoice like a pro to make sure you’re getting paid (kind of important).
· Understand your credit score and how to enlist a credit repair company to remedy any mistakes.
· Seek open source software to reduce costs and learn to fix your computer to extend its life versus having to pay for new equipment.
· Open up to the prospect of investing (Roth IRA, 401k’s, and more).
Simply put: expect the unexpected but meet it with smart financial decisions.
There’s a Time to Trim
The clients you have today may not be the ones of tomorrow.
It’s very easy to ride out your position as a freelancer if you have a range of clients (big and small) but it’s important that you don’t get too comfortable. In time, you may tack on too many nit-picking clients that pay very little and waste a lot of your time.
You need to be okay with eliminating clients on a regular basis.
Apply that 80/20 rule to your business. Trim those clients down to only the ones who are lucrative for your business. Do this every few months to keep it fresh. Have clients that will challenge your skills and others that are always reliable.
Failing to make this part of your freelance activities will lead to overload. You’ll get backed up on projects, lose great clients, and chase low-value, hyped-up opportunities with dead ends. Get proactive and trim – that’s how you keep the momentum and avoid disastrous ups and downs.