There are around two million freelancers in the UK, contributing more than £270billion to the economy.
When such figures are mentioned, it is easy to think going out on your own is a gravy train and it’s time you hopped on board.
After all, who wouldn’t be excited by the prospect of doing something that is uniquely theirs, controlling your own work, hours and priorities.
But for every positive in the freelance world, there is a challenge. The freedom of being your own boss comes with pressure to find new work and manage finances, while that added flexibility can also mean lonely, unsociable hours without a set routine.
For every good aspect of going solo, there is a bad and a plain, old ugly – but the good news is that with careful planning and some creative thinking it’s possible to navigate the freelancing ‘wild west’ and ride off successfully into the sunset.
For most new businesses, sole traders and freelancers work can be intermittent. One day, you’ll be sat staring at the walls praying for that vital next contract, and the next someone will have turned the tap on full speed and you’ll be working until midnight.
Managing your emotions is important. Don’t spend like there’s no tomorrow when that big contract arrives, as you may need that money down the line. Equally, try not to despair if things are quiet – that next big win is probably just around the corner.
Giving up a regular income to follow your freelance goals may herald dreams of self-reliance, but in reality those hopes of ‘being a millionaire next year’ are more likely to become a constant whirl of earning enough to pay the next bill.
Of course, if you get things right, freelancing can provide financial security and the freedom to choose which jobs you take on.
Careful financial planning, developing a proper business plan and marketing to the correct people for your business can help you through any tough times, but it is important to go into any freelancing venture fully aware that monitoring cash flow is likely to become one of your most important jobs.
Deciding on your fees can be another headache. How do you balance your profits, the value of your time and experience, and what the market demands you should charge?
It can be tempting, especially early on, to low-ball yourself and undercut the competition. However, this often leads to potential clients questioning the calibre of your organisation and such a tactic may not be sustainable in the long run.
Doing long hours for little money isn’t the direction you’ll want your business to go in as it can lead to burnout.
Money pressure can also come about due to the scourge of late payments. Government figures show slow payments cost the UK economy more than £11bn every year.
This can be particularly painful for small businesses and freelancers. Chasing late payers can also be time consuming, although accounting software can be used to automatically chase overdue amounts.
The good news is that change could be on its way, with the government having pledged to address late payments via the introduction of maximum 60-day payment terms and mandatory interest rates for those who pay late.
If you’re going to go freelance, you’d better enjoy your own company or be prepared to get creative fast.
For those people who traditionally love those old school office water cooler chats, then having no-one to talk to but ChatGTP can be isolating.
The good news is that there are ways around this. Co-working spaces are becoming increasingly common, or your local coffee shop can often provide a happy escape from the monotony of the home office.
As a freelancer, you may have left behind the strict structure of a traditional workplace role with all that entails. But that doesn’t necessarily mean you’ll get to do everything you want exactly how you think best.
Sometimes freelancers will find they have swapped the tyranny of the office manager for that of the client who always knows best.
Ultimately, you will need to serve your customers – and the customer is always right. Work with clients who are on the same page as you and this can be a joy-filled process. Encounter those who are overly fussy or think they know best even though you’ve been employed as the expert, and your new-found freedom suddenly doesn’t seem quite so liberating.
Of course, freelancers have the power to stop working with people they really don’t get along with, but this only goes so far when you’re trying to run a profitable business.
The biggest challenge can be knowing when and how to push back. After all, your work with a certain client may be judged by other potential customers so you need to make sure you are happy with it.
The thing to remember is that you have been employed to improve someone’s business. By working constructively with you new ‘boss’, you can develop a strong and successful relationship that works for everyone.
Benefits like annual leave and sick leave have become an integral part of every workplace, but that’s not the case for freelancers.
Holiday time provides vital rest and recuperation, allowing people to recharge their batteries while still getting paid. But freelancers, dealing with the demands of incoming work and needing to pay their bills, do not get paid for annual leave. As a freelancer, the choice is keep on working or don’t get paid for a day.
In fact, rather than take a break, many freelancers will end up working weekends and evenings to stay on top of things or take on extra work.
A similar situation arrives if someone gets ill. Time off doesn’t come with sick pay and an extended spell of injury or illness can be very costly if you are not insured.
Putting money aside to cover these situations is sensible, but of course that means having sufficient cash available to do so in the first place.
Working as a freelancer can be hugely rewarding, offering a chance to leave the world of the wage slave behind to carve your own course in the world of work,
Make a success of it, and your profits will flow into your own bank account and not the pockets of corporate bigwigs or shareholders.
But, as with anything that is worth doing, freelancing comes with plenty of challenges.
Those who are more likely to succeed will go into their new venture with their eyes open to the bad and the ugly as well as those goods things that are enticing them to pursue their own path.
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