5 Things to Consider Before You Make That Freelance Leap
As a former long-term freelancer, I can attest: When the going’s good, freelancing is awesome. You roll out of bed, inject an IV of coffee straight into your arm, and get down to it; generally speaking, you don’t have to waste any time commuting, and you’re free to insert a mid-day exercise session into your schedule, be it a couple-mile jog or a Tae Bo DVD. No one is there to judge you for the embarrassingly affectionate nonsense you say to your dog, and you really minimize the chances of anyone noticing you wore the same yoga pants five days in a row (though you might wanna keep those hygiene habits in check, because it can turn into I’m-a-trash-squirrel territory very quickly). A 2015 report from the Bureau of Labor Statistics reports that over 53 million Americans--in other words, 1 out of 3 people--make money outside the parameters of a standard 9-to-5. This is in large part due to the proliferation of accessible “gig economy” jobs like Uber, Lyft, Airbnb, Wag, etc., but also because of the obvious: having more control over how and when you make money is really enticing.
But of course, there are pitfalls and the occasional snake lining the path to blissful career freedom, and when you’re unprepared to handle the fickle lover that is the freelancing lifestyle, disaster can ensue. Before you decide to leave the trappings of the traditional work and give your cubicle the finger, make sure you’ve considered the following:
Quarterly taxes. When you’re a traditional employee, your employer generally withholds taxes for you and you can bemoan the chunk missing from your paycheck from a distance. And if you’re lucky, the Tax Fairy bops you with his wand circa the end of April and you might even get some of that money back. Alas, such is not the case for freelancers. You’re responsible for withholding your own taxes and for sending them to the government on a quarterly basis. It can be really tough to set aside your hard-earned dollars every time you get paid, but it’s even harder to catch up if you don’t (trust me on this one). The best solution I found was to set create a separate bank account that’s exclusively for your taxes, and to then set up an automatic monthly transfer. Calculate how much you expect to owe each quarter with this calculator and then divide it by three to find out how much you should be setting aside each month.
Stability is a unicorn. Particularly in the beginning, cobbling together a freelance base that gets you to a secure place financially requires serious tenacity (or serious connections). Your life may feel like an endless, anxiety-inducing cold call for a while (or hey, forever, even!), and it’s worth noting that the very act of getting out there to rustle up a job is work--work that you don’t get paid for. Before you take that dive, make sure you’ve saved up a financial buffer for lean months, and always keep in mind that work from a consistent source is liable to dry up unexpectedly, which can require you to be fleet on your feet and creative with budgeting.
Mobility is a mixed bag. On the one hand, being a full-time freelancer in a creative industry or an industry that enables you to work from wherever you want means you can essentially leave town to go on trips or take a vacation whenever. On the other hand, this means you probably have to work while you’re on vacation, as there’s no such thing as paid time off when you’re a freelancer. This can be a serious bummer when everyone’s hitting that pitcher of margs super hard and you have to file copy in the morning.
Health insurance. Obamacare was a pretty sweet step forward for many freelancers who’ve long been left out of the healthcare conversation. And personally, I liked that there was a mandate because it took my dumbass reasoning of “I probably won’t get bit by a snake today so I don’t need insurance” out of the equation. But as you might’ve noticed, the healthcare situation is currently mired in a massive, massive clusterfuck. So for the time being, sign up for what you can and get your shit checked out ASAP, because the future is TBD.
You’re not actually an island. Not all freelancers choose this path because they’re Olympic-level introverts, but some do, and if that’s you, time for a reality check: Freelancing doesn’t necessarily equal working for yourself, by yourself--in fact, it very rarely means that. As the labor landscape continues to shift and more and more people are seeking flexible situations that call for a hodgepodge of contracted skillsets, you have to be ready and willing to adapt to a wide variety of situations. In-person meeting twice a week across town? Maybe. Skype meetings every day? Possibly. It’s a harsh reality to face, but there are very few gigs out there that enable you to go five whole days without uttering anything but those aforementioned sweet nothings to your dog.