The 4 things you need to become a freelancer

February 20, 2008

You might have been dreaming of self-employment for a long time, but do you have what it takes to launch a successful freelancing business? This post introduces the four boxes you must tick before you’re ready to take on clients and grow your business.

1. The right mentality

This needs to be sorted out before you tackle anything else. If you’ve decided you want to become a freelancer but haven’t yet made a move, don’t feel bad about it — feel good about it. Leaping into a life-changing career move is something that requires a lot of thought and research. A badly conceived or rushed entry into freelancing can make starting out a lot harder than it has to be.

Here are some questions you should answer before you make the switch:

  1. Is my transition going to be full or partial? Ditching a well-paid IT job for a freelance career will probably involve a big initial income disparity as you try to build a business from scratch. If your expenses require a hefty pay-check you’re probably better off transitioning slowly into freelancing by working fewer hours at your office job and slowly adding freelance hours.
  2. Do I understand how tax works for self-employed people? You probably know this much: it works differently. Each country has their own rules for sole traders and it’s important that you’re aware of these before you start to avoid making any mistakes. Speak with an accountant or visit your government’s taxation website
  3. Do I understand what my working day is going to look like? A roaring extrovert might like the idea of self-employment but loathe hours spent in an empty house (or, alternately, find the presence of family too distracting). Someone used to working with a boss standing over their shoulder might find self-motivation an incredible hurdle. What is your work day going to look like and how are you going to cope?
  4. Do I want to be a web-only or traditional freelancer? Web freelancers find and deal with clients through the web. Because the transfer and organization of work is done online it’s entirely possible to work from anywhere. If you don’t mind being tied to one location, a traditional freelancing business run by phone, in-person and online through a home office could be the option for you.

2. Security

A certain level of security should be established before you make any career change. This is even more important when transitioning into a freelance career: your income will often fluctuate up or down depending on the week, you’ll experience busy periods and quiet periods, you’ll need to set aside your own taxes, and so on.

Financial security is a crucial issue for anyone thinking of becoming a freelancer. The safest option is to test the waters: work your regular job and do some freelancing at the same time until you have an idea of how much clients are willing to pay and how many jobs you’d be able to complete if you were freelancing full-time.

While the above suggestion is probably the most sensible route to take, the desire to drop everything and start fresh can be too powerful to fight against for some. In that case, you won’t have real security without a safety net: savings you can draw on if your business struggles to find its feet.

If everyone groans at tax time — except accountants, I suppose — freelancers get the rawest deal of them all.

Nobody will be automatically deducting tax from your pay and you’ll have to arrange payments yourself. To ensure you don’t come up short at tax-time the most sensible thing you can do is calculate your total monthly income, work out the percentage of tax on it and set aside that money in a separate account. This will stop you dipping into money that actually belongs to the tax office!

3. The right tools

Do you have all the tools and resources you need to work as a freelancer?

This is the start-up kit I’d recommend to any freelancer, but you’re welcome to add and subtract depending on your judgment:

  • A website or blog.
  • A business email address.
  • A method of online invoicing: sites like provide this for you together with Escrow payment protection
  • Industry-standard software.
  • A small filing cabinet/filing system for receipts, invoices and bills.
  • A number you’re going to give clients (unless you’re web-only).
  • A laptop, if you can afford it (for when you need to escape the home office).
  • A printer for making hard copies of online invoices.
  • A business planning system, because nobody is going to tell you what to do and when to do it.A USB thumb drive for transferring work between computers.
  • A home office.

4. A home office

You’ll most likely need space for a computer, a comfortable chair, a filing system, a printer and desk space for offline work (at the very least). The amount of funky extras you can add, like couches, bookshelves and personal touches will depend on how much space you have at your disposal. Having a separate room devoted to your work is often encouraged and probably ideal, but not everyone has an empty room waiting to be converted into a stylish home office.

There are a few central principles to follow, even if you live in a shoebox:

a. Pick the best available space with the fewest tempting distractions.

b. Choose a room that isn’t a thoroughfare.

c. Choose a room with a door you can close. Your home office probably won’t need to spill far out of your desk, but being able to work uninterrupted is a must.

Ending notes

Once you have the right mindset and knowledge, security, the right tools and an adequate home office, you’re ready to move into the next stage of your freelancing career. Next week I’ll be sharing some tips on finding the right kind of work for you.

Until then!



2 Responses to “The 4 things you need to become a freelancer”

  1. This is a very helpful post to freelancers. Those who plan to delve into the freelance world need to know what it takes to be one…

  2. Rustum Khedkar Says:


    While I was looking for small jobs in Accounting & related consultancy on google, I got PPH on my result page and it interested me. I have been through various different pages of it and looks quite interesting to me.

    Currently, I am a full time employee working as SAGE Consultant (Sage Line50, SAGE200 (Fin, Commercials, Project A/c). Looking for small/medium sized business assignments which I can do over weekend or after office hours. This could be a start.

    If there are any works available then I will be able to do it.



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