Choosing to dive into the world of freelance work can be a fantastic career move for many. Not only does it allow you to be your own boss and choose your own projects, but it also allows you to arrange your working hours as you need. If you want to head off on a worldwide adventure or organise your life around a family or some other commitments, freelance can be a great option. However, there are some things you should know before jumping into such a career.
Is It the Right Move?
Going freelance can be a nerve-wracking decision for many. You are leaving behind the security that a regularly paying job brings. If you do not make the money you need for the month, it will be entirely on you. This can be a lot of stress if you have dependents or commitments to support.
This can even extend to small trivial things. Are you an avid gym-goer? You might have to drop down a tier of your membership or cancel the membership altogether if you cannot properly afford it. If you miss a payment of something important, like a car or mortgage repayment, what sort of ramifications will this have for your family? These are all considerations that need to be made.
Setting Up as a Sole Trader or a Limited Company
When you are ready to go, one of the first things you should do is set yourself up as a company. In the UK, this means that you have to register with HMRC to classify yourself as a freelance worker.
You will get to choose between two structures, that of the sole trader and that of the limited company. Sole traders have less paperwork to fill out than limited companies overall but they are also fully responsible for the financial liabilities of the business. Many freelancers choose to operate as sole traders over limited companies, but make sure you investigate the benefits of both.
Work Out Your Rates
Undercharge and you won’t make enough. Overcharge and you may struggle to attract clients. Choosing your rates is going to be one of the hardest balancing acts you will face as a freelancer. A great place to start is by looking to see what your nearest competitors are offering and aligning your prices in a similar way to theirs.
You should also decide whether you will offer a flat-rate fee or some sort of timed fee. For example, many choose to charge by the hour, or a freelance journalist or copywriter may charge by the word.
Find Your First Clients
You may already have your first clients waiting for you to get started, or you may be starting from scratch. Nevertheless, there are some basics that you need to fulfill.
Having professional social media and contact points like an email address is a must. You should also set up a website as soon as you can. Advertising in shared spaces either online or in your local community is also a fantastic way to attract interest to your business and get things rolling.
Even if you are a freelancer, you are still going to need business insurance. This is one of the most crucial applications you can make as a business owner, so get covered as soon as you can. You need to think carefully about the policies you need. For example, professional indemnity insurance is a must for anyone who will be giving out advice while general liability insurance is needed to cover visitors who may come to your office or workshop.
Once you are covered and fully set up, you should be able to begin building your freelance business. It can be as simple or as complex as you like, but you should always aim to make it as profitable as possible. Before you know it, you could be supporting yourself using the money you have earned through your own freelance business.