If the thought of being your own boss, making your own hours and choosing your own projects is appealing—then we want to help. But taking the courageous leap into self-employed life isn’t necessarily a good thing. Without careful planning, you might not be setting yourself up for the best and brightest self-employed future. That’s where we come in.
We want to help you figure out what you want (what you really, really want) and the go for it. Consider the below checklist your non-negotiable to-do list, that’ll launch you into freelance bliss. Ready? Let’s go.
A self-employed person’s checklist
When times get tough—and let’s be real, in the freelance world, you’re going to go through some tough times—keeping the reason you decided to strike out on your own in your mind will help you persevere. So when the going gets tough remember you made this choice because you love to be the boss or you needed to be in charge, to make your dream a reality. Remember why you got off the corporate track to make this happen and you’ll see yourself through any rough patch.
Anyone can have an idea, but only you can turn your unique idea into a business. Take the time to identify the pain point or the need your business helps solve, get to know the competition and ultimately identify what makes you and your business, service, or product better. It’s important to understand the value you bring because you can’t be the best unless you understand how and why you’re better.
Every business needs a business plan. For some, the idea of a business plan causes hives, but if you really think about it, a business plan is nothing more than a list of your goals and the ways in which you think you can get there. Not only does that plan help you, but it helps when it comes to asking for help. Speaking of help, QuickBooks can help you write your plan.
What’s the demand for freelance work in your market—from businesses, agencies, and media? Get to know available work, know how much others are charging and identify ways to deliver value for clients.
Start making a list of everyone you know and kind-of-know in your industry and the industries that are related to yours (i.e. current and former bosses and coworkers, people you worked on projects with etc.) Basically, if they might be a client, or might be able to put you in touch with someone who could become a client, put them on this list. Once your list is filled with contacts, let them (with the exception of current coworkers, if you’re not ready) know what you’re up to. Fight against that instinct to keep your new hustle a secret until you’re successful. Because in the freelance world the only way to get there is to ~work.
Even with a healthy savings account, you’ll still need to save up before making the leap. Startup expenses like travel costs, office space, and marketing materials can creep up on you. Start putting money away now and thinking of ways to cut costs like working from home until your business takes off. Also, put a little money away for self-care. To get started saving, creating a monthly budget. Calculate all of your expenses (i.e. rent, utilities, food, clothing etc. as well as health insurance, retirement fund, and other benefits currently provided to you by your employer). Then, giving yourself a cushion to account for emergencies, weigh that number against your savings and other forms of income. If your savings can cover your expenses for three to six months, you’re in a position to give it a go.
Just because you’re new doesn’t mean you’re cheap. Set your rates with your worth in mind. Charge a fair fee for your services because underselling yourself at the start only makes it harder to raise your rates later.
Whether you’re doing business under your own name or under a brand name, be sure to register your business with your state. If you’re a freelancer who takes on projects here and there without a lot of reliability, then a sole proprietorship (SP) is probably right for you. If you’re using a name other than your own, you’ll also need a “doing business as” (DBA) registration. If you’re working freelance with more regularity and/or with larger companies, then you might consider registering as a limited liability company (LLC).
An LLC comes with a steeper fee and a lot more paperwork but it protects you personally from debt and legal liability. Register your company, pay the fees, buy your domain name, and get going. Contact your local Small Business Association office for a step by step guide to registering your business in your state.
Pretty self-explanatory, but suffice to say: Be brave, be professional and give plenty of notice if possible.
At the end of the day, freelancing isn’t for everyone. But for some, it can be everything. If you’re still not convinced the life is right for you or don’t feel fully prepared, here are some resources that might help.
Now, the only thing left to do is leap. Find out more about the self-employed life by downloading our free financial crash course in becoming self-employed, from us and QuickBooks.