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The Pros and Cons
When it comes to working on your own, you can probably envision
many of the advantages: working in your pajamas, time off
for long lunches and extended weekends at the beach, owning
your own destiny, and keeping all the fruits of your labor.
It’s true that freelancing offers flexibility in terms
of scheduling. You can work when and where you want, as long
as you meet your clients’ deadlines. You control for
whom you work and what you do, and a job well done is a credit
to you alone. But all this independence comes at a price.
Here are the top 5 drawbacks to consulting or working freelance:
- Loneliness
Many freelancers complain about the isolation that comes
with their jobs. Depending on what field you’re in,
you might be alone all day, every day, with just your computer
and your telephone for company. Combat isolation by joining
professional organizations, taking your laptop to a coffee
shop, and making regular appointments to meet with friends
and clients.
- Responsibility
If you can’t pay your heating bill this month,
guess whose fault it is? If the presentation doesn’t
get to the client’s office on time, guess who gets
to answer for it? If you have no work in your in box, guess
who’d better get her marketing rear in gear? You. From
emptying the trash to dealing with problem clients, freelancers
have to get the job done or else pay someone to do it for
them.
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Financial Roller Coaster
Especially when you’re just starting out, freelance
finances are tricky. You no longer have the luxury of a
regular paycheck; instead, you’re paid when the client’s
accounting department gets around to it--and, unfortunately,
sometimes not at all. Prepare for the unpredictable: some
months you’ll be flush; other times you may just be
getting by.
The way to keep your head above water is to keep marketing
yourself, even in the good times, and to build up a financial
safety net so you’re
never on the verge of bankruptcy.
- Lack of Benefits
From health insurance to tax withholding, as a freelancer,
it all comes out of your pocket--and adds up! Most freelancers
use a formula of 33% when figuring out how much these benefits
are going to cost. For instance, if you made $45,000 in
your salaried position, estimate that your benefits cost
your company an additional $15,000 per year. That’s
a substantial amount, especially when you’re trying
to make ends meet and get your business off the ground.
Many professional organizations offer their members health
insurance and other benefits for a reduced cost. And if
you’re married, you may be included on your spouse’s
plan. But make sure you know how you’re going to cover
these needs by thinking through your business strategy and
developing a plan before
going solo.
- Sales and Marketing
“I’m not a salesperson,” you might insist.
“I’m a graphic designer (or an accountant or a
music teacher or…).”
But the truth is, as a consultant, you’re forced to
wear a sales hat. To succeed in this endeavor, you must
market yourself effectively and keep on marketing yourself
as long as you are self-employed. Experienced freelancers
spend about one-third of their time pursuing new business.
For some people, the process of putting themselves out there,
negotiating rates, and signing contracts is extremely painful.
The good news is that it does get easier with time. You
can learn more about how to present yourself effectively
through resources such as professional organizations, networking
groups, and classes through community colleges or adult
education programs.
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The
Pros and Cons
