In Career, Entrepreneurs

How to start freelancing: Part One – The Beginning

The most important thing about starting out as a freelancer is getting paid work.

That’s it.

It is easy to get work. EVERYONE wants to give you work.

It is not that easy to get paid for it.

I’ll go into some basics of how to get started on thinking about it, and if there are questions, I can write follow-up posts.

THE BEGINNING

WHAT DO YOU DO?

Define the kind of work you can freelance in, and then search on LinkedIn for similar profiles, and copy those keywords.

That’s what people use to find other like-minded individuals.

GETTING WORK

Where can you obtain said jobs? Do you use a broker? Open market? Website? Word of mouth?

If you have no idea, you need to at the very least, set up a profile on LinkedIn with those keywords, a headshot (a clear, friendly one – read: Ask Sherry Taking a Professional Headshot ), and then write a little blurb about yourself (check out other people in your industry and copy the most professional / clear looking one).


You can always offer pro bono work (small project), a trial period of 3 months and then re-evaluate afterwards.

Make it easy for them to take a chance on you if you don’t have a body of work to prove to them that you do indeed, know what you are talking about.

DEFINING A RATE

What do you currently get paid? Do you know if it’s a market rate? (If you don’t, my obvious answer to you is find out if it is).

If you don’t know how to find out your market rate, you can ask colleagues, mentors in your industry for ballpark ranges, search on GlassDoor.com to see what they generally pay, check out those market websites where jobs are listed, and see what they are offering as a salary or a rate per hour.

Once you have an idea of what you should be paid as a salary, you can convert that into a freelancer’s salary by doubling it.

Example: $40,0000 / year salary as a paid full-time employee

Freelancer salary = $40,000 x 2 = $80,000

Why times two?

Because you need to assume you can only work HALF the time on average. Over the past decade, this has been very true for me (read: How much have I actually worked?)

I have worked half the time, but gotten twice the money because I’m in a good niche.

You cannot expect to be fully booked every minute of the day.

Think of yourself as a real freelancer, like a plumber, a model, actor or accountant.

There are ebb and flows to your cash flow and work opportunities, and it is foolish to think you will get paid 100% of the time. 50% is a good rule of thumb, then you can adjust it as you move along and track how much you have worked.

DEFINING WHAT KIND OF RATE

From there, you need to decide on what kind of rate.

I am on an hourly basis, lawyers do it by the minute, others do it by the job (a fixed price), and others still, do it by the day (day rate).

Figure out what your industry offers as a type of rate, and go with that.

It is easy to figure out your rate per type if you assume there are 2000 hours in a year.

Why 2000 hours?

Account for 2 weeks vacation, 50 weeks total at 5 days a week = 50 weeks x 5 days x 8 hours = 2000 hours

Then take your salary and divide it out:

$80,000 / 2000 hours = $40/hour

  • By minutes, divide that $40 by minutes to get $0.67/minute
  • By day rate, multiply it by 8 working hours a day to get $320/day

The hardest one is the fixed rate per job.

Figure out what it would take to do the job, then set the rate by hour.

So if you think it will take 100 hours, 100 hours times $40 / hour = $4000 <– that is your fixed rate.

If you work on commission make sure the RULES and the REFERRAL for these rules are CLEAR and unambiguous. May need a lawyer for this.

SET UP YOUR COMPANY

Decide what company you want if any at all.

You don’t have to incorporate, you can go as a sole proprietor, or under your own name and you will pay PERSONAL income tax rates on what you earn.

Check the rules for registration of your company name, check what you need to fill in for reporting to the government yearly, quarterly…

Lastly, I cannot recommend this enough but set up a website and a professional email address.

You don’t need a fancy website, you just need a logo (something simple and easy, google some ideas you can always change your logo later, this is just to get going), and a clear statement of what you are all about, nothing fancy or too word-y.

People who google your email address or website name will WANT to see something there even just a placeholder website with a logo and your contact info.

Give them something professional, ANYTHING.

They just want to see that you took the time to register a domain name and have an email address with that domain name instead of “Sherry82749 @ gmail.com” you know?

Stay tuned for the next part!

(All my posts on this will be under this tag: How to become a freelancer)

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Sherry of Save. Spend. Splurge.

Millionaire at 36 after getting out of $60K of student debt in 18 months, a little over a decade earlier, using TheBudgetingTool.com. Since then, I have paid my $600K home in cash (my half was $300K), my $180K casr in cash, worked 50% of my career (taking 1-2 year breaks), and quadrupled my income within 2 years of graduating, going from $65K to $260K with an average lifetime savings rate of 50%. I could retire today if I wanted, but love my work-life balance as a freelancing consultant in STEM (Science, Technology, Engineering, Math). I am all about balance - between time and money, and also enjoying my money. I also post daily on Instagram @saverspender.

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