Venturing into the World of Freelancing

Understanding Freelancing

A freelancer is an independent contractor who earns a living by undertaking projects on a per-project basis. Unlike an employee, a freelancer must actively seek out work, negotiate the terms of the project, and ensure the work is completed to the client's satisfaction. Once a project is completed, the freelancer seeks out another project.

Freelancers may work on multiple contracts with different clients simultaneously or produce work and then seek buyers. For instance, a freelance magazine writer would fall into the latter category.

Who Hires Freelancers?

Freelancers are hired by a diverse range of clients. Companies often hire freelancers for short-term projects instead of hiring new employees, especially when the work is sporadic or ad hoc. Freelancers are also hired to manage workload fluctuations or for their specialized expertise. For instance, a company may hire a freelance website designer to create a new website, as this is a one-time requirement.

Magazine and newspaper editors also hire freelancers, buying rights to their work. Freelancers in this situation write pieces and submit them to various editors, hoping their work will be published. This approach is speculative, as there is no guarantee of the work being bought. However, once a freelancer's work is published, it becomes easier to sell their work in the future.

What Qualifications Does a Freelancer Need?

To be financially successful, a freelancer needs marketable skills. The qualifications, skills, and talents required are the same as those needed for a full-time employee in the same role. For instance, a freelance website designer must possess the same skills and qualifications as a full-time website designer.

Is a Freelancer Running a Business?

Yes, freelancers are essentially running their own businesses. They source their own work, negotiate their own terms, chase payments, and pay their own taxes. As such, freelancers need to consider taxation, bookkeeping, equipment and supplies, legal entity of the business, licenses, and insurance.

Where Does a Freelancer Find Work?

Freelancers can find work through their existing network, cold marketing, advertising, and joining industry-related associations. They can also create a portfolio of their work to showcase their skills and experience. It's important to note that freelancers may spend more time marketing themselves and their services than actually working, especially in the early stages of their career.

How Does a Freelancer Make Money?

Freelancers make money by charging more than it costs them to do the work in terms of time, expenses, and materials. They can charge by the hour or by the project, depending on the nature of the job and the client.

Protecting Yourself as a Freelancer

Freelancers often wonder if they need a contract. While an oral contract is enforceable, a written contract is always a good idea as it provides proof of the terms agreed upon. The contract should clearly describe the job, set the price, and state the time for performance.