Freelancing: A Beginner’s Guide to Doing It Right
Depending on the field you’re in, freelancing can be a great way to make extra money or transition into a full-time flexible career. But doing it right takes some planning and strategy. If you’re considering freelancing as a way to supplement or replace your current income, here are the basics on how to get started. (See also: 30 Great Side Jobs)
As with any other business, networking makes all the difference in the freelance world.
Use past work connections, friendships, social media sites, and professional groups to get the word out about your services. Have an elevator pitch ready to explain what you do, your qualifications, and what sets you apart from the competition. Though networking is a never-ending process, it’ll become easier as your body of independent work builds and satisfied customers begin spreading the word.
Research and Set Fees
Knowing what to charge can be tricky. Most freelancers make one of two mistakes when it comes to setting their fee structure. Either they underestimate what the market is willing to pay (short changing themselves in the long run), or they price their services too high for their experience level (alienating potential new clients).
Use online research tools to determine what independent contractors are making in your field and in your area. Find the sweet spot based upon your background and skill set.
Establish a Rate Card
Once you know the general range of what you’ll be charging, establish a rate card that outlines your menu of services.
Think of every potential project you could land.
- Will you charge per hour or per project?
- How might your hourly rate change based upon the complexity of the work?
A clear outline of prices (or even a good estimate) will help clients anticipate expenditures and budget for your services.
Pitch Recurring Projects
Big projects are great, but they’re inconsistent. Pitching recurring monthly or quarterly projects to clients will show initiative and help smooth the peaks and valleys in your freelance income. Even a few modestly priced “maintenance” projects that you can count on every month will make a world of difference financially — especially in the beginning.
Create an Invoicing System
Once you have a rate card and are assertively pursuing projects, it’s time to create an invoice. Here, simplicity is key. Create a one page Word document that includes:
- Your business name, address, and phone
- Tax ID number (if applicable)
- Client name, address, and contact person
- Project description
- Date work was completed
- Agreed upon fees and totals
- Method of remittance
- A thank you
For examples of invoices that tick all the right boxes, check out these slick designs from Smashing Magazine.
Every client has a different payment schedule and as your work expands, you’ll need a way to track your invoices quickly and easily. I use a simple Excel sheet with six columns: Client Name, Project Description, Hours Worked, Amount of Invoice, Date Invoiced, and Payment Status. It’s a bare bones way for me to check the status of my billings and helps ensure that no client gets invoiced twice for the same job.
Don’t Forget About Taxes
Remember, freelance work typically means you’ll be receiving a 1099 tax form and will be responsible for setting aside the proper income tax amount yourself. Depending on how you structure your freelance work and how much revenue you’re bringing in, you may be required to file estimated taxes quarterly. Discuss the particulars of your business with a tax advisor to make sure you’re organized for Uncle Sam.
Create a Freelance Resume and Portfolio
Typically, your first few clients as freelancer will be people who know you and know your work. But once you have some projects under your belt, it’s time to formalize it and reflect it in your resume. Create a separate resume or portfolio of work that you can use when pitching projects marketing your business to new clients.
Market, Market, Market
A successful freelance business takes constant attention. The work you’re doing today is probably work you pitched three months ago to a client you met last year. That long horizon must be factored into to your daily work and it’s a discipline that takes some practice to master.
Market your services online, offline, formally, and informally — always with an eye toward where you want to be in six months or a year. Oh, and don’t forget to thank current customers who send new clients your way — referrals are golden.
Are you ready to test the waters of a part-time or full-time freelance career? If so, some upfront planning focused on the basics can save you a lot of time and stress later. Happy freelancing!
Are you a freelancer or have you worked solo in the past? What tips do you have for newbies?