Freelancing and working from home was long considered idyllic by many, but the global pandemic of 2020 sent many traditional office workers into remote work arrangements. After experiencing the pros and cons of remote employment, many are wondering if they should transition into freelancing.
Freelancing may not be for everyone, but we’re going to explore the pros and cons to help you decide if freelancing is the correct income opportunity for you.
Types of freelance jobs
Online freelancing is an umbrella for dozens of in-demand skills, and each sector has its own pros and cons. Some of the most popular freelancing jobs according to studies are:
- Coding and development
- Creative design
- Writing and translation
- Photography and videography
- Project management
- Virtual assistants
All of those are umbrella terms that can cover many specialities and branches. A freelance writer, for example, may write blog articles, site copy, product descriptions, ebooks, company letters, and more. It’s difficult to estimate exactly how much internet content is written by freelance writers, but it’s likely a rather large amount.
Similarly to the real world, a freelancer’s success can be determined by their experience in the field. Freelance writing can be a rather easy industry to break into, if you have creative writing chops, but freelance accounting requires a bit of education and experience in the field upfront.
While not all accountants are CPAs, job hirers tend to prefer accountants who have CPA or CMA certification. But if you’re an accountant without a CPA, you don’t need to go enroll in a physical university to obtain one. You can take online courses and websites like AIS-CPA have a useful guide about passing CPA to help you on this road.
A freelance accountant will perform many of the same duties as an accountant employed with a company, except that the freelance accountant is free to take on other clients. This goes the same for most other freelance jobs, as freelance clients are typically small-medium businesses.
Do freelancers earn more or less than regular employment?
It’s commonly thought that freelancers do not earn as much as their employed counterparts, and that the availability of freelance jobs are either hard to come by, or so prolific as to drive down the rates a freelancer could propose for a job.
There’s two separate things here to address. First, studies show that freelancers in fact earn more than their employed counterparts, with some surveys showing that skilled freelancers earned a median of $28 per hour, compared to the median of $18.80 for the U.S. overall.
Some freelance sectors like creative writing appear to have very low job rates for writers. Platforms like Upwork are full of postings offering as little as $0.015 per word, which would equate to $15 per hour if the writer wrote 1,000 words in 1 hour. They would also likely be quite mentally fatigued after a few hours of this.
In some parts of the world, $15 an hour may seem incredibly generous, whereas in others, it would be considered a minimum wage. The trick to freelancing earnings is to agree on rates competitive with the local job market and what you feel you should earn, otherwise, you might as well work a regular job.
How much a freelancer earns will depend on their portfolio, networking, and marketing abilities. Top freelance writers can earn $50k or more annually, whereas a part-time mid-level freelance writer might earn around $21k.
The biggest challenges facing freelancers
In numerous surveys, freelancers have said their biggest challenges are often:
- Finding and landing clients
- Having a balance between work and private life
- Increasing their rates
It is recommended that freelancers build a portfolio of clients and ask for future referrals, and build lasting relationships with clients who need regular work. Recurring clients are a major way that freelancers become successful, and impressing short-term clients can lead to you being referred to business acquaintances of your clients.
Balancing work and private life can be difficult, as freelancing can cause you to view your leisurely time as idle time wasted. It’s very helpful to know how to achieve work-life balance and keep burnout at bay.
As for increasing rates, it can feel similar to asking your boss for a raise, but that’s if you view the freelancer-client relationship as similar to an employee-boss relationship. Freelancers who realize they are providing a business service as a peer, and not a subordinate, are more likely to successfully establish competitive rates with clients.