Last year, the number of freelancers reached a 40-year high: 15% of the U.K. workforce identifies as freelancers. In September 2014, I joined the ranks of the 4.6 million people who choose to be their own boss. If you’re yearning for the greener pastures of a life spent working independently, now may well be a good time to make the switch.
What Will You Do as a Freelancer?
While there are opportunities to work freelance in a whole range of sectors, some jobs and industries lend themselves more readily to being conquered without a permanent contract. According to freelance platform People Per Hour, the most popular categories for job availability are:
- Design (web, logo, brand/identity)
- Development (website, WordPress)
- Business support
- Writing (copywriting, web writing)
Research commissioned by Elance and the Association of Independent Professionals and the Self-Employed reports high levels of confidence among freelancers and rising earning potential.
With that said, there is quite a bit of preparation to consider when deciding to join the flexible workforce revolution. Here is a simple, three-step guide to going solo:
1. Setting up your business
While there is a high demand for skilled freelancers, there is also a lot of competition out there. You need to consider carefully how you will find work and if there is enough available in your particular field.
Test the Waters
Before you start freelancing full-time, test the waters a little. Take on a few jobs, and register for People Per Hour or Elance. See what it’s like to pitch and win work, and actually do it in your free time. If you can find regular clients, that will help with your transition to freelancing.
Save Enough Money to Cover at Least 3-8 Months of Expenses
Calculate your monthly expenses and be sure to have that saved in the bank. I saved about three months of expenses before quitting my job. My situation is different from many full-time workers: I had a few regular clients already and I felt that having more saved up would encourage me to take it easy.
Set Your Rate
Now that you know your expenses, you know the minimum you need to live. On top of that, you have to factor in holidays, sick days, taxes, time spent doing administrative tasks that you won’t bill directly to clients, and business expenses. Then you must calculate your hourly and day rates. Do this carefully, as you don’t want to price yourself out of the market or sell yourself short.
People look down on Elance but I never stooped to the level of accepting low-paying jobs. I am very selective with my clients and they are selective with their freelancers, which is why they are willing to pay my rates.
Get Your Taxes in Order
Review your financial and tax situation to make sure everything is set up correctly. For example, if you’re in the U.K., you’ll need to declare your income to HMRC so register for the self-assessment right away. They will be able to give you guidance on how much money you should set aside to pay your taxes and National Insurance.
If figures frighten you, enlist the help of cloud-based accounting software. I use Wave Apps because it’s free and helps me invoice clients and keep track of all of my spending — business and otherwise.
2. Setting up Your “Headquarters” and Schedule
Of course, the advantage of being a freelancer is that you can essentially work from anywhere. You could spend all day in your pajamas when you are working from home, but that’s not necessarily going to keep you at your most productive.
Where You Work
I work better when I’m relaxed, so I actually lie across my couch most days, though sometimes it leads me down a spiral of procrastination and Netflix. If I know I have a lot of work that needs doing, I’ll head to a cafe or a theater where I would be too embarrassed to let other people see what’s on my Netflix queue.
Creating a good work environment can help you get into the working day, so instead of sitting on the sofa sipping cups of tea, find yourself a desk or work space. A decent desk and an ergonomic chair are a good place to get started. I like to have a wall planner so I can identify busy periods and lovely wall art to keep me motivated.
Choose a space with natural light and good ventilation. Be sure to take lots of breaks!
When You Work
A routine is so important to freelancing. Personally, I like to work early in the morning (think 6:00 a.m.) until the afternoon, so I can enjoy all of the great things London has to offer. I’ll finish up anything else that needs doing in the evenings. I also follow this schedule if I’m working while traveling so I can see things during the day.
There’s no stopping you from adjusting your working hours for when you feel you work best (though don’t try to get clients to agree to a 1:00 a.m. call — unless they’re in a different time zone). What’s most important is working at a time when you’ll be productive so you can maximize your income while minimizing your time spent working.
3. Finding Clients
This is the most important part of setting yourself up as a freelancer. In an ideal world, you will have clients coming to you (and it will come with time) but its rare to start out that way.
Draw on Old Contacts
If you’ve been working in your field for some time, you may be able to get in touch with people in your network to see who might need your services. Of course, if you were an integral part of your company, you can always offer to freelance or consult for them. Who will know their business better than someone who used to work there?
Utilize Freelance Platforms
There are plenty of freelancing sites online where you can pitch for work, and I’ve scored about seven clients on Elance. When I started, I pitched about 30 jobs a month and was hired maybe 1-2 times. That said, many of those clients I continue to work ,and I no longer need to pitch for work on Elance. People Per Hour, ODesk (merged with Elance), and Freelancer are other platforms used regularly. Just beware of those $2 for 500-words jobs!
Send Letters of Introduction
Pitches are sent to publications, letters of introduction are sent to businesses. They are essentially the same, but the target audience is different. Find businesses in the area who look like they are in need of your services. Does a burgeoning restaurant have a really old website? Offer to update it for them and explain how it will help their business! Does a fashion brand have good products but no community? Tell them about your blogging service!
Do you work from home? Have you been freelancing for long and are there any tips you have learned along the way?
About the Author
Alyssa James is a freelance writer and content marketer based in London.