At The Freelancer Club we hear hundreds of stories every month and we’ve gathered data to determine what the main causes of this drop off are and how to combat them. Here are our top tips on starting a successful career.
Within the last 3 weeks, a new report has emerged in relation to the self employed sector. The majority of the data is very positive. You’ll read about the 1.9 billion pounds that freelancers contribute to the economy in the UK or a 70% increase in the number of mums pursuing a freelance career. It’s undeniable, freelancing is growing fast and there are thousands of success stories. However, for every success story there are four individuals who were not so fortunate.
The main reason that freelancers fail is that they simply run out of money. Particularly in the creative sector, most don’t start freelancing with their business in mind rather it’s a pursuit of their passion and it’s not long before the money runs out.
Get a plan
Most creative freelancers are allergic to forms so the idea of a business plan is about as appealing as a kick in the face. However, the business plan is more than just projections and accounts. A well constructed business plan will provide you with a roadmap to success.
Not only will you have an idea of what to charge, how much you need to earn to survive but you’ll have a much clearer picture of your business. More than anything, you’ll start to think of your freelance career as a business (which it is) and this mindset is a wonderful foundation to start with.
We know that there are plenty of individuals who fall into freelancing whether through necessity or turning a hobby into a business but it’s never too late to put pen to paper and map out your plans.
Another common story we hear is that freelancers run out of money due to a lack of clients early on. There are not too many businesses that start off making large profits from the getgo so don’t feel you’ve failed if you’re not in profit after 6 months it’s very normal. We often hear stories of freelancers who start with a couple hundred pounds in their bank account and have to take out loans to survive. This is not the healthiest way to start your freelance career.
We always suggest that new freelancers have enough savings in their account to cover at least 3 months worth of living costs. Businesses costs money and depending on what sector you’re working in, you’ll most likely need capital to set up.
Get a bank account
Once you start making money and you’re sure that your freelance business is up and running, get a dedicated bank account. Dipping into your personal account makes it very tricky to see what you’re spending on your business and equally difficult to reinvest money back into your business. This is a sure fire way of stunting the growth of your business. Once you have a separate account you’ll be able to see where the money is going a lot clearer.
We also recommend opening a savings account to put 20% of all earnings in for tax. It maybe more than you’ll have to pay at the end of the year but at least you know you’re covered and anything left over can go to the much needed holiday at the end of the year.
The Freelancer Club support freelancers through paid job opportunities, promoting your service, downloadable legal documents, freelance resources, networking events, webinars, masterclasses and much more. To join the club, sign up for free or try pro membership free for 7 days.