The life and career of a freelancer can seem ideal to many—flexible hours, no boss, and no more paperwork. But, like most things in life, it isn’t as easy, or as hard, as it seems. To have a successful freelance business, you need to look at the realistic side of self-employment to really know if it’s something that you want to pursue.
Read on to learn some of the biggest myths and misconceptions about freelancing and self-employment.
1) When you freelance, you are your own boss
Technically, yes, you are your own boss. But realistically, you’ll have at least a few bosses in the form of clients. The more clients that you have, the more people you need to answer to and work your schedule around.
You will still have the ability to control what you do for clients and how many you have, but you will also have to be conscious of keeping up a good business relationship with them. That means answering their calls, meeting their deadlines, and providing them with quality work.
This also plays into the “you get to work when you want” misconception. In reality, you get to work when the client needs you to. If they’re working full-time during the day, you may need to make yourself available in the evenings. Be flexible and offer hours that your clients can fit into.
“You’ve got to seize the opportunity if it’s presented to you.”—Clive Davis
2) You don’t have to pay taxes when you freelance
Taxes aren’t taken right off of your paychecks when you are self-employed, but you do have to take a certain amount off personally and keep it tucked away in a savings account. When tax season comes around, you’ll use it to pay anything that you owe.
You also don’t have benefits docked from your pay, but you should still invest in some sort of insurance so that you don’t have to pay full price for prescriptions and medical appointments.
If you’re going to freelance, you need to be budget conscious and good with money. If you aren’t, you may end up in trouble when it comes time to file your taxes.
“Actions may not always bring happiness, but there is no happiness without action.”—Benjamin Disraeli
3) You can freelance with one skill
You can, but your clients will want you to have more. For example, if you are a writer by trade, your clients may request social media marketing, design, or other services. Instead of having to contract out those services, invest in learning some new skills for yourself so that you can offer more things to your clients and bring more business to yourself.
Offering one service limits your opportunities and keeps you from getting more long-term contracts. Instead of offering one time use services, try wearing a few different hats so that your clients can use your services continually.
“The secret to success is to do the common things uncommonly well.”—John D. Rockefeller
4) It costs a lot to start freelancing
If your skills are computer-based, like writing, web design, graphic design, social media marketing, programming, or other similar services, you don’t need much to start. Chances are you already have all of the equipment that you need, such as a desk, computer, and internet access.
Don’t blow a bunch of money on things that you don’t immediately need. Start out with what you have and think about what you really need to get the job done. Sometimes, clients will even request or allow you to work from their offices. When they do this, they’ll generally supply at least some equipment for you.
Buy things when you need them, not when you want them.
“The way to get started is to quit talking and begin doing.” – Walt Disney
5) If I freelance, I won’t have to do paperwork
You’ll probably be doing more paperwork than you ever did before. You need to invoice clients, record and file bills, receipts, and proof of payments, as well as complete your tax information.
If you have an accountant, they can help you with all of these things, but if you are just starting out, chances are you can’t afford one yet. If not, talk to other freelancers to see what you need to have. Some of the most important paperwork includes:
- Business expense receipts and records
- Documentation of method, amount, and date of payments
- Expenses billed to clients
- Tax forms for self-employment
Stay organized. Find a system that works for you so that it’s simple, easy, and quick to track all of your income and debts. Knowing your current income at all times will give you an idea of what you need to do to get where you want to be. If you’re set to make less than you had hoped, maybe skip that vacation you were planning. If you happen to be making more, consider investing in that new touchscreen monitor that would make your job easier.
“The only limit to your impact is your imagination and commitment.” – Anthony Robbins
6) Freelancers don’t need contracts
Yes you certainly do. Whether it’s a client, friend, or family member, when you go to do your taxes, the IRS will want to see where your money came from. Having a contract proves that you were in a business relationship and that it was expected to be financially fruitful.
It might seem awkward to make your cousin fill out and sign a contract, but it will put you both on the same page in terms of the service and you will be recognized as a professional. It will also keep you out of trouble when trying to figure out your payment details.
You’re a business, and you should show that through your actions. Be sure to use a contract that suits your job description, such as a Consulting Agreement or an Independent Contractor Agreement to protect both yourself and your clients.
“We are what we repeatedly do. Excellence, therefore, is not an act but a habit.” – Aristotle
7) I’ll be a great marketer
To get your name out there, you’ll have to do some marketing. That means social media marketing, networking, pamphlets, brochures, sales kits, and more.
If you’re not completely comfortable doing these things, it’s probably best to enlist the help of someone who is. If you market yourself poorly, you aren’t going to find any clients.
If you don’t have the money to put into marketing, do your research and learn to do it the right way before you start. Getting your brand, message, and services across in the right way is what will grow your name and get you referrals.
Marketing isn’t for everyone, so be honest with yourself about your abilities.
“Many great ideas go unexecuted, and many great executioners are without ideas. One without the other is worthless.” – Tim Blixseth
Remember that you can start freelancing on the side and test the water. You don’t need to jump in head first to become successful. Taking the time to really understand your goals and plans will help you to make a better, well-informed decision.
Freelancing isn’t for everyone, but it can be a rewarding, lucrative, and successful venture if you have the time, dedication, and drive.
Have you ever freelanced? Are there any myths that you would like to add?