Freelancing offers a new sense of freedom and flexibility that many employees miss out on. It can be rewarding but hard work. If you’re thinking of going freelance, here are some key pros and cons to think about before you take the leap.
Work when you’re at your best
Are you a night owl? The 9-5 has probably been difficult for you in the past. Good news, freelancing allows you the flexibility to work whenever it suits you. Aim to work when you’re naturally at your best and more able to concentrate and remain productive.
Fit around family life
Following on from the previous point about flexibility, freelancing is also good for balancing work and family life. In fact many new parents opt for freelancing when they can’t find a job that offers them the flexibility they need.
No earning limit
Technically, there’s no limit to the amount that you can earn. It all depends on how much you charge, how many clients you win and how well you manage your time. The more efficient you are at managing your time on things like marketing and admin, the more time you can free up to spend on client work in billable hours.
Cheap start-up costs
As business start-up costs go, freelancing is probably one of the cheapest ways to become a business owner. This will obviously depend on what line of work you’re in and whether you need specialist equipment but it is still going to cost less than setting up a traditional business.
You won’t have to spend money on employees or office space as you can just work from home. If you need help with anything, you can always hire another freelancer for odd jobs, which will work out cheaper too.
Low risk if you start with a side business
Many freelancers start off by keeping their day job as the flexibility allows them to run a business around usual work hours. This route also allows you to test drive the freelance life without the risk of losing your income.
The price of flexibility is that your income is never guaranteed. Your income will depend entirely on how much work you manage to get and what you’re charging. There can be dry spells where you worry about making enough or there can be busy periods where you find yourself turning work down. This unpredictability is what often puts people off from starting out as a freelancer.
It can get lonely
Working for yourself is inevitably going to get a bit lonely. This can affect extroverted people more and get in the way of productivity. Even introverts will struggle with this from time to time. Not only are you missing out on company, you’ve also got no one to turn to for advice on work problems or business decisions.
Miss out on employee benefits
When you work for yourself you miss out on things like holiday and maternity pay that employees get.
There is also some confusion about how changes to National Insurance will affect the self-employed. At the moment, self-employed people pay Class 2 and Class 4 National Insurance. The government plans to scrap Class 2.
However, this is the only one that contributes to state benefits so there will need to be a reform to ensure business owners are not missing out. This will most likely come in the form of an increase to Class 4 contributions but there is still uncertainty.
Missing out on benefits means that you’ll need to be charging more than you think in order to cover the loss. A lot of freelancers get uncomfortable charging high fees so that’s something you might have to work on.
You’ll have to run a business solo
This is the part that many newbie freelancers aren’t prepared for. Chances are the client work won’t be too difficult if you’ve had experience in it before.
However, you’re going to have to get used to wearing many different hats when it comes to the day-to-day running of your business. You’ll have to get used to marketing and self-promotion, customer service, managing finances and keeping track of expenses on top of client work.
Have we missed anything out? What do you think is the most important thing to know before going freelance? Let us know what you think in the comments.