Just a few years ago, the idea of ditching a full-time job in order to participate in the gig economy would have been a crazy thought. Now, over a quarter of Americans work for an on-demand service or as a freelancer. If you’re thinking of trying out this new lifestyle, there are a few things you should know first.
It’s About the Flexibility, But…
The biggest draw to the gig economy is the flexibility that comes from working for yourself. With most gigs, you get to work wherever and whenever you want. This is a huge lifestyle change from the usual 9-5 grind. However, the lack of a traditional employer means you are now completely responsible for your taxes, health insurance and retirement plan.
Despite this lack of financial security and benefits, a study conducted by the Harvard Business Review found that gig workers would not give up their independence in favor of a traditional employer. They believed that they were leading more fulfilling lives than they were previously.
This does not mean freelance is a walk in the park. You are a one-man shop for all things creative, business and HR-related. It takes time to build a successful business for yourself. To get started, you need to be a regimented risk-taker and problem-solver with the tenacity to stick it through — essential characteristics necessary to getting your business off the ground.
What You’ll Need
As a freelancer, you will need to send contracts and invoices. Independent photographers, graphic artists and management consultants need to handle each transaction as a partnership. And, instead of taking a class in contract law, many websites provide handy templates for you to download to ensure that you are paid on time.
You’ll need to stay on top of filing quarterly taxes: April 15, June 15, September 15 and January 15. If you miss these deadlines, it will cost you a hefty fine from Uncle Sam. As a result, it is important to put some money aside to cover the self-employment taxes from a 1099-MISC form that each client must provide to you.
Treat it Like a Business
To be successful in this new sphere, you need to treat yourself like a business from the start. If you are currently working a full-time job working or considering to transform a side gig into a full-time gig, The Balance recommends starting by building on a customer-by-customer basis. Do not quit your day job until you have a sustainable flow of customers.
Create a website and order business cards as soon as possible. You want to come off as professional whenever interacting with a potential client. To further set yourself apart from your competitors, narrow your audience. Though it may sound counterproductive, defining a niche will help you land more and higher paying jobs.
Stick to Your Business Hours
Freelance and gig jobs don’t mean you have ample amounts of free time. Forbes stresses the idea of setting boundaries. Set business hours for yourself and do not let friends or family distract you during your working hours. Treat it like you would if you had to go into an office.
On the other hand, you need to respect those hours, too. It’s easy to fall into the habit of always working. But this can quickly lead to a burnout. So long as you do not have an immediate deadline, walk away from your job at the end of the day. Turn off your phone and stop checking email. It’ll be there tomorrow and you need a chance to breathe. Don’t forget to take a vacation, too, you’ve earned it.
Working for Yourself
There is a lot of satisfaction and fulfillment to working for yourself, but it is also a lot of hard work. However, if you are ready to put in the sweat and effort, it pays off. Start small and build from there. In time, you can be in complete control of your job and lifestyle.