What You Don't Know About Freelance Work Is Costing You Money

If you’re a freelancer, there are so many things no one tells you when you start out that can cost both time and money.

First and foremost, let’s talk about health insurance, which isn’t just an expense it’s also a legal requirement.

And what about dealing with taxes as a freelancer? There’s even more to it than just paying your quarterly tax bills!

Finally, if you’ve ever wanted to learn how to grow your network but were afraid to ask, look no further than this friendly guide.

Even after years of freelance work under my belt, I’m still learning new tricks every day. So let’s dive in!

New to Freelance Work? AVOID THESE MISTAKES! – YouTube

Takeaways
Lack of knowledge about freelance work can lead to financial losses.
Understanding the nuances of freelance work can help maximize earnings.
Freelancers should be aware of common financial pitfalls and how to avoid them.
Proper pricing and charging strategies are essential for freelancers.
Continuous learning and staying updated can improve financial outcomes in freelance work.

Table of Contents

Freelancing Is Not For Everyone

Freelancing is not for everyone. If you’re looking to make some extra cash while sitting on the couch, freelancing isn’t the right gig for you.

Freelancing requires a lot of hard work, dedication, and effort. You need an understanding of your market and an ability to deliver high-quality work consistently to succeed as a freelancer.

Are you looking to boost your earnings as a freelancer? Mastering the right skills can make all the difference. Check out our guide on the top 10 freelance skills to charge more and take your freelancing career to the next level.

You Need To Have Your Business Structure, Or Hire Someone To Set It Up For You

There are some things you don’t know about freelance work that is costing you money, and it’s not just the billable hours.
You need to have your business structure or hire someone to set it up for you
A lot of freelancers get this wrong, but this is where the true money-saving opportunity lies:

If you pay yourself as an employee through a corporation or partnership, not only do you lose out on higher tax deductions (like health insurance premiums), but also lower ones (like clothing purchases).

You Can’t Charge A Flat Rate For Everything

If you’re going to charge a flat rate, make sure that you can justify it. You need to be able to justify your rates to yourself.

So that when someone asks why your prices are what they are, why they should hire you over another freelancer whose work costs less (but doesn’t have as much experience).

Or why their job should cost more than another client did last month you know exactly what the answer is.

So how do we back up our claims? Let’s start with some industry standards:

The Government Will Always Get Their Money

While most freelancers don’t have to worry about this, there are some situations in which you’ll need to pay taxes on your income.

The main thing to keep in mind is that the government will always get its money. If you’re working for a company or agency as a contractor or subcontractor, then they’ll likely withhold taxes from each paycheck and send them directly to the IRS (and/or state).

Additionally, if you make over $600 in one year from freelance projects (not including self-employment).

Then they’ll require that you fill out additional paperwork which means giving up more of your personal information than what most people would care to share online.

Tired of the 9-to-5 grind? Discover how freelancing can provide you with the freedom to explore the world. Our article on how freelancing gave me the gift of time and travel shares personal experiences and valuable insights for aspiring digital nomads.

Your Time Is Valuable, Factor That Into Your Hourly Rate

In the world of freelancing, it’s easy to get caught up in comparing your rate to that of other people.

But here’s the thing: you’re not them. You don’t have their experience or skillset, so why would you charge yourself less than them?

And if you think about it, this may be hurting others they might be charging more than they have to because they’re worried about undercutting themselves by being lower than someone else who isn’t as skilled or experienced.

Instead of worrying about what others are charging and how much time you’re putting in per hour.

Focus on what value YOU bring to the table and what clients are willing to pay for that value (and no one else’s).

Don’t Take On The Responsibility Of Doing Other People’s Jobs Unless You’re Being Paid Extra

Do you take on the responsibility of doing other people’s jobs?

When you do this, it’s called doing unpaid work.

If a client asks you to do something that is not specifically set out in your contract, then you should only agree if they pay extra for it.

If they don’t want to pay for it, then ask them why and explain why their request isn’t reasonable or fair.

If they still refuse, then tell them that if they don’t pay for the extra work at least at the same rate as what was originally agreed upon in your contract (or preferably even more).

Then there will be consequences later on like having less time available than expected or having higher costs due to lost productivity because of stress caused by overworking yourself unnecessarily.

Don’t Be Afraid To Charge For Your Travel Expenses

This is a biggie. You need to be prepared to charge for your travel time unless you’re already an established freelancer with a lot of repeat business and/or a dedicated network of clients in one region.

If you’re new, just starting, and trying to build up your client base, don’t expect anyone but the most desperate (and cheap) clients will want to pay for your travel time.

That’s not to say that I never accepted jobs that required me to drive across town or even out of town (I’m based in New York City).

But these were rare exceptions and they were only accepted because I could justify them as being in line with my hourly rate or project rate.

Freelancing isn’t just a job; it’s a transformative experience that can reshape your perspective on work. Dive into our reflections on what freelancing has taught me about work and discover the hidden lessons and valuable takeaways from the freelance journey.

You’ll Need To Work More With Freelancing Than A Traditional Job

You’ll need to work more with freelancing than a traditional job. That’s because the way freelancers are paid is different from how employees are paid.

Employees are guaranteed a certain amount of hours and get paid for those hours worked, even if they don’t have any work to do.

As an employee, you can slack off or work slowly without it affecting your income much (as long as management doesn’t notice).

If you’re self-employed, it’s easy for clients not only to notice that you’re slacking off or working slowly.

They will expect you to deliver real results for them within the period agreed upon when they hired you! If not, guess what happens?

They will find someone who will hit their deadlines and deliver real results!

As a self-employed people, there is no one telling us what we should be doing at any given moment during our day;

We have complete freedom over how we spend our time when working on projects with clients.

This means that if we don’t stay focused on getting things done in the right order and at the right place.

Then not only will our clients be unhappy with us but also they won’t feel like paying us anymore since they won’t see any progress coming out of them paying us so much money every month (or week).

There’s No Such Thing As Paid Vacation Days, So Save Up And Plan When You Want To Take Some Time Off

When it comes to planning for vacations and holidays, there are two things you need to be thinking about: how much money you’re going to need, and when you’re going to save it.

You’ll also want to figure out how much money you can afford per month in your budget so that you know what’s realistic for your freelance work.

You’ll also want to make sure that the amount that’s leftover after paying bills each month is enough so that if something comes up (like an unexpected car repair).

Then there will still be some leftovers in case of emergencies.

If You’re Not Skilled In Something, Don’t Be Afraid To Hire Someone Else To Do It For You

If you’re not skilled in something, don’t be afraid to hire someone else to do it for you. If you are a writer and need help with your website design, hire a freelancer with web design skills.

You can even hire multiple people: one to create the site, another to handle marketing and social media management for you.

Hiring talented people is an investment that will pay off big time in terms of increased productivity and better results.

But only if you treat them as part of your team rather than just “independent contractors” or “subcontractors.”

You Can’t Get Away With Doing Mediocre Work, Your Reputation Matters More Than Ever Before

In the past, freelancers could get away with doing mediocre work. The internet was young and small and no one had heard of you yet.

You could just find another client and move on, as long as you didn’t breach any contracts or break any laws.

But now there are so many freelancers available that clients can’t find someone who knows how to do their job well unless they’ve heard good things about them from a trusted source.

It’s not enough for clients just to have a recommendation from someone in their network; they’ll want proof that their chosen contractor is going to be able to deliver what they need.

And if the first few projects don’t go well, then chances are those recommendations won’t last long either! This means that reputation matters more than ever before so how do you build one?

Thinking of pursuing a career in freelance writing? Explore the pros and cons before taking the leap. Our article on the pros and cons of becoming a freelance writer provides a balanced overview, helping you make an informed decision about this creative profession.

Not Having Money Isn’t An Excuse Not To Dress Well And Look Good

You probably have a good idea of what it means to be professional. You know that you need to dress well and look sharp when you go into an office every day.

But being professional isn’t just about wearing the right clothes – it’s also about making the right impression on your clients, and in turn, showing them why they should trust you with their business.

If you aren’t working in an office, then this can be even more important than usual because clients will often judge their potential freelancers by how they look before anything else.

They’ll ask themselves questions like: “Does this person seem like they have their act together?” or “Do I think that this person is worth paying for?”

And if the answer is no, then there’s going to be some problems down the road.

Let me give an example from my own experience: In college (where I did most of my freelance writing), my friend had a job as a waitress at a restaurant called Panera Bread Company (yes, that does say “bread” instead of bakery).

She wore jeans and t-shirts every day because that was all she owned at the time – but one day she got dressed up because she wanted some extra tips while working her shift during lunchtime rush hour…and boy did people notice!

Not only did her tips increase significantly the whole restaurant started noticing her too! And guess what happened next? She started getting promoted within weeks!

Networking Is The Most Important Part Of Freelancing – It’s What Will Bring You New Clients And Keep Your Business Running Strong!

Networking is the most important part of freelancing – it’s what will bring you new clients and keep your business running strong!

Networking is a skill that can be learned, improved upon, practiced, and applied in any situation. Don’t shy away from networking because you’re nervous or intimidated by it;

Instead, learn the ins and outs of networking so that you can confidently approach anyone who can help your business grow.

Here are some tips for becoming an expert networker:

Freelancing Isn’t Easy And It Requires A Lot Of Hard Work For Success

You see, while many people might think that freelance work is easy and something they can do on the side to make a little extra money, the reality is that it takes dedication and hard work for you to have success.

Freelancing isn’t for everyone and if you’re not willing to put in the time necessary to be successful at it, then freelancing probably isn’t right for you.

Your first step should be figuring out who your target audience is going to be and what they want from your services or product.

You need to have some sort of business structure in place so that clients know who they’re working with and there’s accountability when things go wrong (which they usually do).

If all of this seems overwhelming or confusing then hiring someone else might be an option worth exploring!

Are you curious about the joys and advantages of freelancing? Hear firsthand from someone who believes it’s the best decision they’ve made. Read our article on why freelancing is the best thing that ever happened to me and discover the transformative power of freelancing for personal and professional growth.

Conclusion

Takeaway: The freelance economy is booming because people are realizing they can use their skills to create an extra income stream or even a full-time career. But as freelancers themselves would tell you, this isn’t always as easy as it sounds!

For example, one common mistake many first-graders who are new at freelancing make is working too much for too little money.

But if you know how much money should be going toward expenses like taxes and health insurance before accepting any job offers from clients, then there will be less stress when tax season comes around every year.

This blog post also includes helpful resources like pricing calculators or websites that offer tips on how best to price your work so that it’s competitive enough without losing out on profits by undervaluing yourself (and your skills).

Maybe now might not be the right time for everyone who wants a side hustle with minimal effort but maximum reward but when they’re ready? They’ll know where they need to go first!

Frequently Asked Questions

What Is Freelance Work?

Freelance work is when you work for yourself, rather than a company. You find clients and set your hours, and the upside is that you get to keep all of your profits. The downside is that you have to do all the administrative work involved in running a business.

How Do I Find Clients?

There are lots of ways to find clients. You can market yourself on social media, go through a job board, or refer people who need help with their businesses. You’ll also want to check out our website for more resources!

How Much Money Can I Make?

This depends on how many clients you have and how much time you put into finding new ones! But if you’re willing to put in some effort, it’s possible for everyone even those who are just starting to make at least $30 per hour as freelancers.

What Is A Freelance Contract?

A freelance contract is an agreement between two parties, one of whom is an employer and the other a freelancer.

The freelance contract defines the relationship between the two parties, including things like how much money will be paid, what kind of work will be done, and when it should be completed by.

What Does It Mean To Be A Freelance Writer?

A freelance writer is someone who writes articles, blog posts, copy for websites, etc., and then sells those articles to companies who want them written.

This job can be done from anywhere in the world as long as there’s an internet connection available so you can communicate with your clients via email/phone/etc.

Costantine Edward

Costantine Edward is a digital marketing expert, freelance writer, and entrepreneur who helps people attain financial freedom. I’ve been working in marketing since I was 18 years old and have managed to build a successful career doing what I love.

What You Don’t Know About Freelance Work Is Costing You Money