How to Compensate For A Bad Income Month as a FreelancerWritten by Mindaugas on January 15, 2018
Freelancers are resilient, versatile and dedicated people. They have to be since their income greatly depends on those factors. Capable folk that are self sufficient and are able to adapt at a moments notice.
Work is not set in stone for freelancers. One day it’s there; you’re soaring high and flourishing, the next day it’s gone and you’re wondering when the next project will turn up. Even falling ill may put a damper on your financial security.
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You may have encountered times when your income flow diminished and you had to get by with dwindling funds in your bank account.
Let’s see how you can mitigate the financial damage of a slow work month for yourself.
Companies have marketing campaigns and branding specialists that promote their goods and services. Envision yourself and your ability as a product that needs marketing to inform people that you are there. Learn to effectively promote yourself.
If there ever comes a time when the quantity of work just isn’t what it used to be, spend that downtime promoting your skills. When an opportunity comes and the schedule frees up, employ that free time to expose your ability and experience you have gained over the years to the community.
There is always someone out there looking for your skill set, but they first need to know of your existence.
Come up with a marketing strategy that you can apply to yourself. Use it wisely to attract new clients.
Whatever you specialize in, chances are there is a networking event out there that is dedicated to what you’re doing. Also don’t hesitate to go to events that may not be something you’re used to.
See what other opportunities are out there for you to dig your freelancing claws into. Don’t limit yourself. If for example, you are a freelance content writer, don’t dismiss the idea of checking out networking events about social media marketing, or brand promotion.
These events are great to meet people face to face. In person meetings build more personal, and memorable relationships. It will be easier to establish trust with a potentially new client.
Expand Your Horizons
Freelancing blesses people with the ability to work remotely. That is a trait not many job positions share. Don’t limit yourself to working in the same area. You have the ability to reach people all around the world, make sure you are making the most of it.
Some work opportunities may have already left your area. Avoid hesitation and look for freelancing positions in a different cities or even abroad.
Economic climate shifts at times; use your flexibility to shift along with it.
Charge Per Project
You may think to yourself, how much is my time worth? Some freelancers charge by the hour, and in most cases they are able to get the rate that they are satisfied with. For now.
Starting off low may be what you want to do. Gather a solid client base, make yourself known as a reputable freelancer that knows his stuff and is able to deliver well on his promises.
As time goes on, you begin working for higher quality clients and decide it’s time to give yourself a raise.
Hourly rates are not how you should go about when it comes to charging your clients for your work. Especially if you are efficient and know how to manage your time.
Jake Jorgovan wrote about his dismal experience when it came to pricing his freelancing work in “Pricing 101 – How to Price Yourself As A Freelancer”. He was charging $60 as an hourly rate, and spent 3 hours designing a website for a client. That’s 3 hours of work for a website that most companies would easily pay thousands of dollars for. He got paid $180.
What you should take away from this is that charging per project will get you a whole lot further than hourly rates. Your income generation will be much more efficient.
This method will leave you open to having the ability to continue pursuing other projects and networking with future clients.
Imagine spending days or in some cases months on a project for a client and then not being reimbursed for your work that you did. Not only you have forgone other clients to commit your effort to this individual, but now you are not even getting anything in return.
Protect yourself financially, don’t be taken advantage of.
First and foremost, whenever undertaking any task or project you need to insure yourself and get a deposit up front from your client. Don’t start your project without a deposit. You never know how the circumstances can change.
This ensures that the individual or the company you are working with is committed to having you on board.
If you get a deposit of 50% and then then client decides to skip town on you, at least you won’t be entirely empty handed. 50% of something is better than 100% of nothing.
Part of the Job
Deposit can also come in use whenever a need for subcontracting arises. Rather than digging into your own pocket, you have a sizable chunk of capital to reach into to help cover those costs.
Remember that if your client is reputable and there is mutual respect between the two parties involved, getting a deposit for work shouldn’t be an issue.
Freelancers are most successful when they are able to handle a variety of tasks and projects that are being offered to them at a moments notice. You never know what will come knocking on your door.
Branch out and expand your knowledge into other areas that have the potential to aid your freelancing ability. Sometimes the area you’re focused in may just dry out for a time and now you’re sitting there without any foreseeable projects. Take advantage of all available resources and adapt; learning for you should be a never ending process.
Versatile freelancers are also able to attract more attention to themselves from potential income sources.
You will be able to apply yourself and your ability to a wider range of companies. Having more to offer opens up smorgasbord of opportunities out there for you to sink your teeth into. Not only will that improve your job prospects but also increase your value as a freelancer
Build Your Reputation
Let your work speak for itself. With a great reputation, dry spells with be far and few between. You clients will be willing to pay you more because they know if they choose you, they will receive unprecedented quality work.
Having a great reputation is an immensely powerful tool for a freelancer. Even the clients that may not have any projects to offer you will promote you to their partners and other clients.
Prepare for Rainy Day
Hope for the best, prepare for the worst. That should always be how you approach work and income as a freelancer. Good business and income may leave you as quick as it came, so always look into the future.
Never hurts to be prepared for when a dry spell hits and your cash flow halts. An unexpected emergency or an illness can also reduce your income drastically. If you have prepared yourself financially, you can brave this bump in your financial road.
Live Bellow Your Means
Just because you have money, and the income flow looks good for the foreseeable future, doesn’t mean things will stay like this.
Avoid splurging on unnecessary purchases. Control those spending habits. If you have money doesn’t mean you have to spend it all.
True prosperity lies in how much money you have not home much money you earn. Remember as a freelancer, your work may be volatile and can shift for the worse at any moment. Living bellow your means will allow you to have minimal lifestyle cutbacks during unforeseen financial crisis.
If you haven’t already, start creating a weekly or a monthly budget for what and when you buy things.
Making a habit out of budgeting is great for everyone – freelancers are no exception. You should always be aware of your finances; money coming in and money going out.
Budgeting gives you a nice visual representation on how you spend your money. There might be some things that can be trimmed up from your spending habits to free up some income that can go into savings or investing.
Retrace Your Steps
Retrace your steps and go over your recent invoices. Check and read through all the details. Be absolutely sure if you actually were able to collect all the money that is owed to you by your clients.
When taking on projects or multiple projects at once, sometimes there might be a chance that getting reimbursed for the work you did could’ve slipped your mind.
Never hurts to double check and go over the finances with a fine tooth comb to see if your client delivered on their promises. It would be a shame for you if there was an uncollected invoice collecting dust somewhere in your desk.
If you haven’t done it already, switch to online invoicing. As a freelancer online invoicing makes your job a whole lot more easier, and keeping your finances in order will be a breeze.