Is Freeleancing For You?
Contracting/ freelancing often gets a bad rap. A picture of a struggling worker, working hard for barely any money, wondering when their next paycheck is coming in often comes to mind.
But is that reality?
Take a look at these stats.
Many people make a great career out of contracting and are extremely happy having the flexibility to work from wherever they want, get away for a couple of hours during the day to volunteer at their child’s school, and allow themselves extra time off if they need or want it.
When I started contracting, I was open to making less money so that I can have the extra flexibility, freedom, and the ability to pick and choose assignments that interested me.
It turns out I have all of those things AND I make at least twice as much as I did when I was working for a company.
So, is it right for YOU?
Now’s the time to get honest with yourself about why you want to go from a full-time job to a contractor. Here are some things to consider when you’re thinking about whether or not freelancing is for you.
DO YOU NEED BENEFITS & INSURANCE?
This is a huge consideration for many people. Health insurance can be very expensive, and having to purchase it out of pocket can be very costly. The best-case scenario is that you get benefits through your spouse or partner, however, a layoff for them may mean big costs in healthcare for you and your family.
401k is another thing to consider. While you are eligible for a 401k as a small business owner, you won’t have the benefit of contributions from an employer.
ARE YOU SELF-MOTIVATED?
Contractors need to be self-motivated and have the ability to juggle multiple projects.
Chances are that you will work with a variety of clients, which means that you have a few irons in the fire at the same time. Making sure that all of your clients are getting some “love” and attention can be a balancing act that constantly feels like it’s teetering in the wrong direction and your job is to constantly re-balance the scale.
Remember, you won’t have a boss, but you WILL have clients. Keeping your clients is the #1 best sales strategy that you can possibly invest. I have kept my schedule full (and turn down a lot of opportunities) by not doing any advertising at all – it’s 100% repeat business, word of mouth, and referrals.
CAN YOU PUT UP WITH INCOME FLUCTUATIONS AND INSTABILITY?
The life of a contractor often means that the money you bring in won’t be consistent from month to month. Is that something that you can tolerate, not only financially but mentally? Will it stress you out?
What is often a positive side to this is that you have the opportunity to make MORE money during certain months that you may need it and are willing to put the time in for.
With contracting, although taking time off is your prerogative, it can mean you’re not getting paid or are getting depending on what your business is. Generally, if you work less, you make less. This brings me to the next one:
WILL YOU WANT TO SCALE YOUR BUSINESS?
A potential downside to freelancing is that it can be difficult to scale your business. The contracting model typically means that you exchange money for a certain amount of work, making it difficult to grow your business past the number of hours you have to give.
While contracting is not necessarily set up for easy scaling, you can absolutely springboard into different opportunities that are scalable. In fact, many business owners start as contractors or freelancers who then expand their offerings into products and other opportunities. Outsourcing is also a potential opportunity to scale your business.
I have been contracting for 5 years and absolutely love it. I really can’t imagine doing anything else.