Things to Consider Before becoming Freelance
Freelancer – Are you looking forward to starting a small business venture? If you’d like to leave the 9-5 world behind and become a freelancer, there’s a lot to consider first. Freelancers often earn more than wage employees, but only if they make the right moves. Should you set up a small business with employees for a range of different clients? Do you want to set up a consulting firm or become an independent contractor? It’s important to realize that there’s more than just startup costs to account for when you’re considering different ways to branch out on your own.
You may have a home office, a good credit score that allows you to get a suitable lender for any startup costs for your small business, and online courses to improve your skills. Also, consider whether you want to improve your skills in a particular niche, how you can get a stream of passive income to tide over any times of uncertainty, or keep you financially secure if it takes a long time to start seeing profit.
It’s important to realize that there’s more than just startup costs to account for when you’re considering different ways to branch out on your own. For example, you might wish to try to tackle each of your business processes yourself, or you could look to outsource some tasks as you build and grow your company. For example, if you were to start a health and wellness brand, looking to outsource your marketing, or even your Wholesale private label supplements manufacturing processes could actually streamline your business, increase profits, and ensure you have a great product that promotes itself well.
1. Think about your finances.
Before you start your own small business or independent freelancer operation, check all your finances. Set financial goals and save some money to cushion the initial years of your freelancing business and give yourself some runway. A great way to start is to generate some passive income before you begin. It will help secure your future if your freelancing cash flow isn’t steady or immediate. Make sure you select suitable passive income investments that will benefit your finances.
If you’re investing in stocks and mutual funds, make sure you invest in a dividend stock to receive some funds from it. Dividends can help you create a nest egg so your freelancing business can grow at a natural, organic pace. A great passive income idea is real estate. If you decide to get a passive income stream as a landlord, make sure you invest in the right properties and consider real estate investment trusts. Also, ensure you protect rental income from property damage and defaulting tenant issues.
Consider hiring an accredited investor that can help you make these decisions. A great way to pick the perfect one is to read customer reviews and check out their investment strategy and residual income options. For example, a peer lending platform like Yieldstreet is a great way for beginners to generate passive income. Sign up with their services to see whether refinancing, stocks, rental property, index funds, or the stock market is your best bet.
2. Consider getting business insurance.
Do you know everything about being a business owner? You may not be a small-business owner, but even a sole proprietorship is a business. And, if freelancing is your business, you need to know all about business taxes and business insurance. Find out whether you need to register yourself as self-employed, how to handle invoices, and what you can write off at the end of the year when you file taxes.
Also, find out everything you need to know about business insurance. If you have employees or assistance, perhaps you need workers’ compensation or compulsory third party insurance. If you’re a sole proprietor, what sort of business insurance do you need to buy? Take a look at insurance products and compare rates before you get one.
Consider things like professional liability insurance, the type of insurance you need for medical expenses, health insurance, or a business owner’s policy. You may need life insurance or to get business insurance to prevent liability from accidents or property damage. In the long run, any type of insurance can be helpful. You can spend a lot of money on lawsuits and private business legal issues if you’re not careful. To prevent this, make sure you get the best type of insurance with sufficient coverage.
3. Build a client base.
It’s tempting to dive in and find your clients as you go along. However, freelancing is a slow business at first. Since you’re usually not making a set monthly income, there’s no guarantee you will meet your financial goals every month. It takes a lot of time to set up a successful income stream. And you can go months without a steady income. If you start with a few clients, you can reduce your risk of an empty savings account in your first few months.
Building your client base in advance will help give you the ability to be selective about your clients. The easiest way to start bringing in better clients is to build your brand. Create an attractive online portfolio, market yourself on social media. Start a social media account for your freelancing business.
Also, think of affiliate marketing and consider taking an online course to get additional certificates. Online freelancer sites can also help pad your income stream or earn some extra cash on the side. You can even get a personal loan until you build a client base, but make sure you research any lending spaces before signing any paperwork.
