Over the last decade, the growing popularity of freelancing has increased the number of global freelancers — resulting in the rise of the gig economy.
More people in the UK and worldwide are ditching traditional full-time employment for freelancing, while others do freelancing on the side in addition to their full-time jobs.
Besides, freelancing offers flexibility and control that the average 9-5 doesn’t – which is one of the many reasons for the massive freelancer influx (over 40% from 2008).
Want to find out more about freelancing? Keep reading.
This article will answer some of the frequently asked questions about freelancing, giving you all the information you need to leap into freelancing. So, let’s get right to it.
Freelancers are usually self-employed individuals that deliver services to their clients on a project or contract basis. They do not commit to full-time employment, and they set their hours. Sometimes, they simultaneously work on multiple projects for various clients. Besides, some freelancers work full-time, while some work part-time and are usually paid per task, project, or hour.
All types of companies hire freelancers to complete different tasks regardless of their size. This is because most freelancers are skilled and experienced at what they do. Some freelancers use agencies to get jobs (gigs), while others use freelance platforms.
There are other terms usually used in place of freelancing, and some of them are highlighted below.
If you see these terms used in any work setting, they refer to freelancers.
You need to register your freelance business, but choosing the legal entity is entirely up to you. You can choose sole proprietorship, partnership, or Limited Liability Company, but what you choose will affect your liability, the amount of tax you will pay, and other essential things.
Freelancing works just like every other type of self-employment – you accept payment in return for service rendered. For freelancers, the services are short-term or long-term, depending on how long the client needs your services. Some companies go as far as putting some freelancers on retainer, which should not be confused with full-time employment.
There are several benefits to freelancing, and they are outlined below.
Just as there are benefits, there are also some disadvantages of freelancing, such as:
There are different categories of work you can do as a freelancer, including:
Upwork’s freelance forward report reported that the freelancing gig economy was over $1 billion in 2020. Some of the in-demand freelance jobs in this market include graphic design, content writing, mobile development, social media management, animation, and video production.
It is straightforward to start as a freelancer—accept payment for service rendered, and you are well on your way. Different freelance sites have an abundance of freelance jobs that you can register on. This is an excellent way to start, especially for beginners. But before you take the step to register on these freelance websites, you need to set up a brand for your freelancing.
You also need to figure out the services that you want to offer and your target market. This will streamline your choice of platforms, as not all platforms cater to all types of freelancers. After you have settled on a brand identity, create a portfolio to showcase your skills, but you can skip this step if you are a beginner. Additionally, social media is an excellent way to market your services and get freelance clients.
There are three primary ways you can get jobs as a freelancer; work directly with clients, freelance websites, and through subcontracting. To work with clients directly, you will have to rely on networking, marketing, and referrals, as this is one of the hardest paths to follow as a freelancer.
On the other hand, subcontracting reduces the hassle involved with dealing with individual clients. Subcontracting involves getting an assignment from an original contract. In simple terms, it is when an agency delegates work they got hired to do to freelancers.
Freelance platforms are a trendy way for freelancers to find work, and different types are available. These platforms, or marketplaces as they are fondly called, act as the middlemen between freelancers and clients, and they take the stress out of looking for jobs or dealing directly with clients. Some popular freelance platforms include FlexJobs, Upwork, Fiverr, Freelancer, Guru, PeoplePerHour, and SolidGigs.
A 2019 study by Upwork and freelancers union reported that the median freelance rate is $20 to $28 per hour, but this can vary with the type of freelance job. For example, programmers can earn over $70 per hour, while transcribers may earn only $10 per hour.
Yes, you can start freelancing while still working full-time. This is the standard option that most freelancers choose, enabling them to build their work portfolio and customer base before eventually quitting their job.
Beginners can use freelance platforms to build up their skills and expertise; the best platform depends on your needs. Each platform has pros and cons, so it is best to factor in your needs when choosing a freelance platform. However, Upwork and Fiverr rank as the two best freelancing marketplaces.
Unlike full-time employment, where your company deals with everything related to insurance, you need to choose an insurance policy that will protect you from the unexpected. Everything from health to business, liability and indemnity insurance is essential. Additionally, you need to set up a retirement plan for yourself.
Yes, a beginner can start freelancing as long as you have a skill or a service you can offer.
Once your freelance business is registered, you are legally required to pay taxes. You can combat tax payments and returns hassle by investing in an expense-tracking and invoicing system. It is best to hire a tax consultant if you need help understanding how to file your taxes.
You are not required legally to open a business account, but it is advisable to do so. Many online retailers, such as Amazon, accept ACH payments as a payment method.
This is because separating your business and personal finances will make it easy to calculate your profit and claim your expenses at the end of the year.
Freelance contracts are a way to protect yourself from liability, such as legal issues or non-payment. You need to draft your contract for your business and ensure that you and your clients sign before beginning any new project. Plus, you do not need to create your contract from scratch, as several templates are available online that you can download ad edit to fit your business structure.
You can work on different projects simultaneously as a freelancer. You must remember to provide good quality service so your clients keep returning.
You do not need special skills to be a freelancer; you can start with the skills you already have. However, if you want a competitive edge over other freelancers, you need a specialized skill.