The Top 6 Mistakes Every New Freelancer Makes
If you’re just starting out as a freelancer, try to avoid these top 6 mistakes every new freelancer makes. For every happy freelancer, there’s probably one or two people who try their hand at the waters of work for themselves but then make an unintentional retreat back in their offices.
Some people are perfectly okay, and some aren’t cut out to become a freelancer, and it’s fine exploring the idea and later deciding to change your career. There are plenty of reasons to temporarily freelance and later return to full-time work, such as being in a downturn and having a child or exploring an entirely new sector of your business.
The problem is when people who have the potential to build successful freelance careers make mistakes that cause them to return to their old 9-to-5 routine.
6 Common Mistakes Usually Beginners Make
The positive is that, by putting a little thought into your plan, you can steer away from the majority of these common top 6 mistakes every new freelancer makes and be set to be successful, whether you continue to freelance until retirement or return to Corporate America on your terms.
1. Start Without Enough Savings:
Most finance experts will inform you that you should have 3 to 6 months’ worth of living expenses to save to make an emergency fund, even if you’re not thinking of starting your own freelance company. If you’re going to start a business by yourself, it is necessary to add costs for starting up to this figure.
If you’re a freelancer and don’t have plans to hire any employees at present, it’s unnecessary to be concerned about wages and (most likely) leasing office space. Your old four-year-old laptop and comfortable kitchen table may be the perfect combination as a temporary freelance assignment; however, they can be quite frustrating when you can get regular work. Be aware of the expenses that will likely pop up in the first couple of months and prepare for them.
2. Not defining goals (and then revising them):
What can you do to end your freelance job? It’s a bigger issue than it appears to be on the surface.
It’s up to you to answer this question:
- To feel successful, do you have to earn more than you made when you were an employee?
- Are you be able to pay off your debts and keep an amount aside for rainy days suffice?
- Do you value autonomy and flexibility in your schedule and the option to pick the clients you’ll work with?
Create an e-Timeline. Once you’ve determined the goals you want to achieve, you can set a timetable. Monitor your progress at regular intervals to see if you’ve achieved the goals. Also, remember that it’s okay to change objectives as you gain more about your goals and the marketplace.
Create a Business Plan. Make a business strategy to outline your goals. Even if you plan to operate as a sole proprietorship having a plan for your business can aid in ensuring that you’re headed in the proper direction. It can be a good reminder to consider the business and yourself seriously.
3. Do not dive in too soon:
It’s a great idea to start your freelance career when you are working full-time for several reasons. In the first place, it lets you test different types of work and clients to see which you enjoy the most. It also allows you to make errors and fix them without explaining to the nice guy in the company why you’ll never pay the bill for this month.
It also aids in making that nest egg you’ll require in your bank. The most effective way to accumulate savings when you’re considering a freelance career is to save your earnings from any additional work you do while you’re working full-time at your job.
4. The Contract is not being followed:
Handshakes are a possibility. However, it’s better to sign a formal agreement with clients. But likely not in the way you imagine. The existence of a contract doesn’t assist you in recovering money if the company fails to pay since it’s very difficult for one person to get the company to pay.
Legal costs are often more than you expect to get back. Contracts are designed to set expectations between the parties, ensure that honest people are honest, and ensure that there aren’t any unexpected costs later on.
5. Not having a Successful System:
Freelancers maintain their financial records, including costs, dues, and receive payments. Being an independent worker, you don’t have to purchase small company accounting software, and you only need the right system.
For certain freelancers who are freelance, an Excel sheet and an envelope to record receipts are sufficient. For others, you can use one of these personal finance software programs that can do the trick.
6. Not Charging enough (or charging too much):
Now the most important of the top 6 mistakes every new freelancer makes, come. The process of setting rates for your services isn’t easy but most important. Don’t go too high, and you could lose the job. If you set the price too low, you’ll end up being in a state of emotional and financial overextension that you’ll be unable to be at your best. If you’re a freelance in the same field as your full-time occupation, your rate set is somewhat more straightforward.
The most difficult aspect of the calculation is working out all the benefits included in your compensation, such as retirement and health insurance and office equipment. After you have determined, in general, what you earned for your last full-time position, You can divide that amount and bill per hour or per project, based upon your estimation of the time each project is expected to take.
Finally, once you’re working as a freelancer for some time, don’t be afraid to take another look at your rates, revise them, and negotiate accordingly–especially when you take new freelance jobs. If you worked for an employer, you’re likely to receive an increment soon in the future.
Do not forget to offer yourself the same consideration as soon as you’re the boss of your own.
Thank you for coming down here. Hope you found some actionable information here. If you have any questions or suggestions, please leave it in the comments section below.