But it is important to be realistic about all aspects of becoming a freelancer, and to properly consider these before deciding whether to take the plunge and go freelance yourself.
Here, we will present a balanced view of the pros and cons of going freelance so that anyone about to make this decision can do so in an informed manner.
A lot of the pros of becoming a freelance agent, freelance contractor or self-employed contractor depending on the terminology you wish to use are self-evident. A list of some of these is presented below:
The ability to set your own hours
Depending on your personal circumstances, this can be the main selling point for a lot of people. Especially useful if you have childcare commitments, the ability to choose when to start/stop work (within reason – there will usually almost always be a requirement to overlap your hours with those of your clients) is the kind of flexibility that usually just isn't possible in the 'normal' working world.
The money you earn goes to you
Another obvious attraction to freelance work is that there are no company or shareholders taking a cut of the profits that you make. What you earn, you get to take home.
More variety and choice in assignments
Working for yourself means that you can have more say over the kind of projects on which your skills are focussed – allowing you to develop in areas that you are interested in, and stay away from those tedious jobs the boss used to give you!
Working from home
Imagine if your daily commute consisted of walking downstairs to your home study/office (perhaps grabbing breakfast from the kitchen on the way). In most cases, working from home saves a minimum of an hour over commuting to an office and in some cases where your daily commute is particularly lengthy you might save even more! What you choose to do with this saved time is down to you – you can either turn it in to profitable time, or reclaim some of your life back.
But before you start typing that letter of resignation, you would do well to also consider the following:
Uncertainty
This has to be by far the biggest factor to consider before going freelance. Unless you are lucky enough to be starting your freelance life with an existing client base, and a guarantee of regular work from them, then you will be reliant on winning new business week to week, month to month in order to ensure you achieve the level of income that you need. Even if you do get the level of work you need, you must be prepared for delays in receiving payment from your clients. In short, you can kiss the regular monthly pay-cheque goodbye!
Lack of employment benefits
Although the current employment market is making this less and less of a factor, moving from regularly employed work to becoming self-employed does mean that you will lose out certain benefits. For example, 20 days holiday pay from your current employer amounts to essentially a month's pay when you are on holiday. As a freelancer, you won't be getting paid while you are on holiday, and so your earnings need to be sufficiently high to compensate. There are also other benefits that you will no longer be entitled to such as health insurance and retirement benefits.
Marketing yourself
To win new business, people need to know about you, and if you are working for yourself then the only way they are going to know anything is if you promote yourself. There are of course many different ways of doing this, from cold-calling, to newspaper advertisements, to attending trade exhibitions. How you accomplish this will be down to you and the industry you work within, but you must get used to the idea that you will be at least part-time sales person once you take the leap and go freelance.
Running the business
As a self-employed person, there are a number of elements of running as business that you will need to take care of (or to pay a professional to take care of). These include the keeping of accounts, payment of appropriate taxes & national insurance contributions, legal and insurance requirements, chasing non-payment of invoices as well as taking care of the promotional side of things. This can represent a steep learning curve, and of course is time that you would otherwise be spending on making money! The alternative of hiring an accountant to keep your books etc. can often be prohibitively expensive, particularly when starting up.
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