In this week’s episode, we talked about the downsides that self-employment has when contrasted with working a traditional job.
To most people, working from home is synonymous with lounging around, watching TV, and doing whatever you want, whenever you want. But the reality for most freelancers is far different.
Since we covered what we sometimes miss from working a regular day job, we also wanted to take a moment to cover things that come with freelancing that you might not have anticipated.
Being self-employed means facing many challenges – challenges you never would have thought about during your day dreams of working for yourself.
Here are three things you wouldn’t expect from freelancing, but that you should prepare for.
You Might Get a Full-Time Job Offer
How about we start off with a bang? One thing I certainly didn’t anticipate when I went the freelancing route was getting a full-time job offer…but I did. Twice.
Technically, my first offer came in the form of an unpaid gig working at a start-up. Unfortunately, it didn’t go very far, but this was an opportunity I didn’t anticipate. At all.
The second offer I did take – two of my clients offered me full-time hours in between the two of them.
I know a few other freelancers who have been contacted by clients or companies they’ve worked with to come on board full-time as well, so these aren’t isolated incidents in the least.
When you think about it, it makes sense. Depending on the field you work in, your clients may become long-term clients. I’ve been working with some of mine for close to two years now.
If you’re lucky, you’ll grow with them…and as their businesses grows, so do the opportunities they can extend to you. It’s up to you to decide which path you want to go down.
Working Extremely Hard for ‘Vacation Hours’
It’s no secret that when you work for yourself, you don’t paid for the time you take off for vacation or other activities. Yes, freelancing allows you to be location independent and take as many days off or vacations as you can afford. However, if you don’t work, you don’t eat in a sense because you won’t make any money. Therefore, you can’t take as many off days as you’d like because working for yourself is still work even though it’s flexible.
I experienced this first hand since I’m currently juggling working full time with freelancing. When I scheduled time off at my traditional job for my honeymoon, I felt a little pressure to make sure I had all my work done but it wasn’t nearly as much pressure as I felt in terms of working ahead with my freelancing business.
Even though I was going to be on vacation for a week, I still had deadlines to meet, invoices to send, and clients to communicate with. Unlike with my day job, there was no one else around to answer emails for me or maintain the workflow. I didn’t want to work during my honeymoon either so I did my best to work ahead.
During the weeks leading up to my wedding I spent most nights cramming in extra work and when I did all I could with the time I had, I still had to ask one client if I could skip my article for their site for one week since I wouldn’t have time to do it. I had never skipped an article before so she was fine with it, but I was slightly bummed that I would receive less income from that client for the following month as a result.
No one wants to work when on a true vacation or even check emails for that matter. I set up an email autoresponder and even reach out to some of my clients directly to let them know I’ll be away from my computer for a few days and I usually tackle my inbox when I return. You can also hire a VA to manage your email while you’re away if you get a ton of messages each day.
If you’re going to work for yourself but don’t imagine yourself working every single day, I’d recommend getting at least 1-2 weeks ahead with your tasks. This way if you need to take a sick day or vacation, it’s not detrimental to your schedule, income, or workflow.
Taxes, Taxes, Taxes
One of the things I like best about running my own business is that I can make as much money as I want to – truly! If I want to earn more money I can seek additional work with my current clients, or try to find new clients or brands to partner with. I also have complete control over how much I charge for my services. I can raise my rates with current clients whenever I want. Plus I can also ask for more money whenever I get a new client.
The only downside to earning more money is having to pay self-employment taxes on it.
I’ve always saved a large portion of my freelance income to help cover taxes. But last year I ended up in a higher tax bracket than my accountant and I were expecting. This resulted in me having to fork over a large chunk of money to cover my 2015 taxes in April of this year. Then I turned around the next week and paid my quarterly taxes for 2016. It was a painful week to write two large checks for self-employment taxes.
I just try to remember that the positives of self-employment still outweigh this negative. Plus if you are paying more in taxes, it’s because you made more money.
Have you ever thought about freelancing? If you are a freelancer, have you experienced any unexpected outcomes?