Last Updated on Apr 17, 2020 by James W
Freelancing has changed dramatically over the past several years. Technology and the internet have made it possible for many people to explore new careers and new ways to make money. In many cases, these freelance gigs start out as just something you do on the side for extra cash, but they can also turn into something much more. Here are some tips for turning a freelance gig into a full-time career.
Find Some Gigs While You Are Still Working
The best thing about freelancing is that you can try out jobs to see if you like them. One of the best ways to get started is to take a few jobs while you still have your steady full-time work. This allows you to find out what you like and what you don’t like to do, and it gives you a chance to see what kind of income potential there is. Another benefit to trying out some gigs while still employed is that you can tuck some money away before you make the transition to full-time freelancing.
Make Your Plan
Image via Flickr by striatic
Once you decide what types of jobs and gigs you want to do, it is time to make a plan. At this point, you should have a few clients that you like to work for and you can count on, so now you should come up with a written business plan for your freelance career. Make sure to include how much money you need just to stay afloat and how much income you need to save money.
Your business plan should also include how you will market yourself to gain clients and increase your earning potential. It should also include a timeline for making the kind of money you need.
Bookkeeping
One of the most important things to keep in mind when you make the decision to work for yourself is bookkeeping. You no longer have an employer to take care of the accounting, so you’ll need to keep track of your income and expenses. There are systems out there that can help you do this, and even make it easy. QuickBooks allows you to create invoices for your clients, it will track payments, and you can produce all kinds of reports to see how you are doing.
Taxes
Planning ahead for taxes is often a challenge for those new to freelancing. If you work as an independent contractor, your taxes don’t come out of your paycheck each week or month, so you need to set money aside on your own. Independent contractors also have a different tax structure which includes paying their own Medicaid taxes and their own social security.
The best course of action is to hire an accountant to make sure you have all the correct information, and they can help you decide how much money you need to set aside. You can send the IRS a quarterly or annual payment based on your estimated annual income.
Making the decision to work full-time as a freelancer is a big step, but it can be very rewarding. Just make sure to have a plan, and stay on the lookout for new clients because they come and go.
