Being freelance has its advantages. It can be an exciting life with regular changes to your work environment, new challenges and opportunities to be creative in different ways. However, like all jobs, being a freelancer takes practice. You may be good technically and creatively but alongside that you need to deal with the day to day business of being in business. Here are 5 things that most freelancers will tell you they wish they either knew at the start or they knew but didn’t really do enough about.
Saving for a rainy day. One of the mistakes new freelancers make is living high off the hog on those early contracts. When you have 6 months of well paid work visible it seems like a long way to the end. It isn’t though. In fact not only is it not a long time but then you may need to go hunting for work afterwards. 6 months on contract quickly turns into 6 months off. Be sensible and invest some of your hard earned cash to see you through rainy days.
The Taxperson cometh. In all fairness, H.M.R.C. is much more open and friendly these days but, make no mistake, they are coming. You need to either do company return or self-assessment at some point in the year and there is no escaping it. Tax, and for some people V.A.T. returns, are a legal requirement and you need to do them. We can help you with this one. Give us a call and we will be happy to talk about looking after your tax for you.
Livin’ La Vida loca. When you are putting in the long hours it’s easy to fall into the trap of releasing the tensions of the day by hitting the high spots. A little R&R is needed, have fun and go wild now and again, you earned it. Just make sure you listen to your body and slow down as well. Too much excitement and too much high living will not help your career and turning up at a job with a hangover or sleep deprived is never acceptable.
You can’t do everything. There are a hundred things you could do yourself but you need to offset this against the time taken to do them. You could for example design your own business cards but a designer will do it faster and better. You could negotiate your own contract but we could do that for you with a little more insight while you get on with other things. The list is endless so learn to delegate and buy in skills. It will often provide a better return on investment than doing it yourself.
Diary, Diary, Diary. Get a routine, follow it and project manage. You need to make sure you do the job on time but there are other things to consider. Make time in your day to do things like you are doing now. Read the blogs, keep up with the industry, check your social media or just chat to someone in the kitchen. And always stay on top of technical or industrial developments.
Being freelance is a great way to work if you make sure you are working right. The people who succeed tend to be the ones who know that and avoid some or all of the pitfalls.
In a recent article we were discussing some of the pleasures of being freelance and some of the things most freelancers will tell you they wish they had known at the beginning of their career. One of the disadvantages of being freelance is, unlike traditional employment, it can be difficult to estimate your value. Make no mistake though you do have a value and often this is more than you think.
Let’s take a ’real world’ moment here though because we are freelance and yes, sometimes you just need to take the work. Sometimes you have nothing else on so a low paid bit of work fills the day and generates some income. Sometimes smaller companies or start-ups don’t have the finances available to pay full rate but they may be doing something interesting that you want to be involved with. All of these things are perfectly acceptable assuming they are a one off. If you allow them to become working practice they can lead to a pretty low income. You need to be aware of how much you are worth to be able to see when to make the exception. Before you sign the contract you will need to consider the value of the job compared to the terms of the contract.
(We discussed this in a recent article about contract negotiations in the Creative Arts industry, which may be worth reviewing)
While there may be the odd exception like the sci-fi blockbuster in the above article, chances are that a lot of jobs will pay the rate for the work and you will be fine. The bottom line is that as a freelancer working on a job you deserve to be paid the best rate for the work you do. To undervalue yourself in the job is to undervalue your skills; and this in turn undervalues everyone.
When you look at it from that perspective it becomes obvious that you need to negotiate carefully to get the right rates. Let’s dispel some myths and think about this the right way.
- Everyone works for less than rate. Actually, no they don’t. Some people do but they are usually new to the business or have a particular reason for doing it. If you don’t have a reason why do it?
- I will price myself out of a job. Or you could price yourself into one. Producers and other freelancers expect to pay a reasonable rate. Rather than pricing yourself out of a job you may just be throwing money away.
- I am working for a friend so I should work for less. OK this one can be difficult but just because you are working for an old friend doesn’t mean that you are not working. If you want to do a deal then fine but at least start from rate.
- The client pays and they don’t pay the full rate. Your first question here should be why? This one should set the alarm bells off. If the rest of the job seems to pan out then the reason they don’t want to pay rate may be, to be a little frank, down to greed. More worryingly it could be that they don’t have the funds for the production and are trying to cut costs.
- Negotiating rates is hard. For some people this is true. We may be able to help with this one. If you are not strong on this side of the business hand it over to someone who is.
In the final analysis working for next to nothing results in earning almost nothing. So remember, value yourself, value your work and ask us for advice, or let us negotiate for you.
Another New Year rolls around. Another 12 months where we will all make a list of wildly unattainable resolutions that we will promise, hand on heart, to stand by. Of course we will only stand by them until the pressure of keeping them up kicks in and we slip back into old habits. This usually occurs between 2nd– 5th of January.
So this year, with our tongue firmly in our cheek, we thought we would give some tax tips for freelancers – attainable and honest New Year’s resolutions with bad excuses already attached.
This year I promise to…
- Not fall for the latest gadget or upgrade my equipment unless I genuinely need the gadget or upgrade… or I really like it… or it has a really, really nice flashing light on it… or it’s relatively cheap.
- Keep focused at work. I will be a high powered laser of concentration burning through my inbox…unless I need some down time…or I meet that mate of mine I used to work with…or I see some squirrels out of the window.
- Eat properly and exercise. This is the year I get myself in shape. I will visit the gym and eat three healthy meals a day… unless I am really busy… or I deserve a treat for going to the gym… going to the gym burns up a lot of calories so I will need a mars bar or two to stay focused at work… Unless I haven’t been to the gym because I was too busy, in which case the snacks are lunch anyway.
- Keep up with the industry and really do my research…and research does not mean sitting with my feet on my desk in the middle of the day, eating ice-cream while watching on-demand television…unless it is actually research because it’s about something I am going to be working on or in…or potentially on or in…or I know someone who was on the show… or it’s a particularly good episode of Game of Thrones or something.
- Keep my tax records up to date…unless I am in a bit of a rush, in which case I will promise to do it later…unless I forget what the record was supposed to be about in which case I will file it for later review…unless really, really can’t remember what that receipt was for, in which case I will put it in a shoebox with it’s 50 brothers and empty it onto the desk of my advisor at Blue Skies then run away.
- My final resolution is I will not intentionally follow any of the above New Year resolutions…particularly the last one, which is really financially dangerous and upsets my lovely friends at Blue Skies. Really, don’t do it!
Have a wonderful New Year everyone!