More and more people are going into self-employment, and you might want to consider the switch, too. With the job market as it is, the competition for places is making life very hard for those that want to go into traditional employment. There are just so many people applying for the same job that it is almost impossible to get a foothold in the race. Self-employment, however, is booming and jobs are nowhere near as hard to find. Plus, lots of jobs pay well and offer a job security. There is no doubt that the industry is on the up and that a self-employed role should feature in your thoughts.
Before you pull the trigger, it is essential to understand that self-employment isn’t easy. As far as full employment goes, that is a cakewalk compared to what you might have to go through. But, the hard work is well worth it in the end, especially if you like the flexibility and power of being the boss. It is also worth it if you know how to sidestep the landmines on the road to success.
Here is a handful of tips that should help. Good luck!
Be Prepared To Work Hard
Yep, working in the industry does have its advantages, like working from home. Just think – you get to roll out of bed and work in your PJs! Although it is a nice thought, it is something everyone should try to avoid. The fact that you get to work at home is a benefit, but it shouldn’t get in the way of your productivity. Far too many workers that have a home office don’t get through the amount of daily work they should because of the distractions. The main distraction is that, because you’re at home, you think you can procrastinate. Sorry, there isn’t time for procrastinating if you want to be successful. Treat the experience as if you would any other job as it’s the only way it will work out in your favour.
Saying you will treat it as a regular job and doing it are two different things. Walking the walk is never easy because it takes a lot of time to get into the swing of self-employed. Anyone that has never worked from home or been the boss might struggle initially. A good way to get past this stumbling block is to set strict deadlines that you intend to keep. The deadlines will centralise your focus so that the work comes first, as well as keep you productive. For example, if you want to finish by 4 p.m, you can’t take 2 hours for your lunch. Break the work down into bite size chunks and use the pieces to tackle the day.
Don’t Take Holidays
Let me rephrase that because everyone deserves a vacation. What the title should say is that you shouldn’t take unnecessary holidays because time is money. As you aren’t in full employment, you don’t get the same benefits as other employees. That means you don’t get holiday or sick pay, so you lose money when you don’t work. For anyone that wants to make a killing, this isn’t a big deal as long as you treat your vacation time as a gift. Sure, save a couple of weeks throughout the year, and use them whenever possible, but don’t go overboard. The more time you spend on a beach, the less money you will make. Although money isn’t everything, it is important when you need to pay the bills.
Sort Out The Tax
As a self-employed worker, you are responsible for taking care of your tax contributions. Lots of people won’t know what to do, which is why it’s imperative you do your research. For starters, begin with what you will have to pay over the course of a year. To do that, take a look at your wage and project your yearly income. Then, subtract the income tax threshold and divide the rest by 20%. Also, don’t forget to include national insurance contributions which work out at around 9%. The trick, once you know the amount, is to put away the money each week so that there isn’t a gaping hole in your taxes. The good news is you don’t have to focus on paying taxes – you can concentrate on cutting them, too. The self-employed enjoy a lot of tax loopholes which everyone should use to save them money. After all, your tax contributions come to almost 30% of your wage, and it’s legal. The main thing to look out for is tax expenses. Non-permanent employees can claim everything from a uniform tax rebate to a business lunch. As long as it is relevant to your job and you keep the receipts, you’ll be okay. A word of warning – make sure you keep detailed receipts. Should the taxman knock at your door, he will need solid proof. Otherwise, you can get a fine or a jail sentence.
Treat Yourself Well
Because you have to pay for everything, you will try to cut corners. It is only human nature because you want to save money. The thing is that cutting corners isn’t the right tactic even if it seems like a good idea. The problem lies with the fact that you don’t give yourself everything you need to succeed. Instead, the self-employed try to get by with the bare minimum, and it affects the final product. So, if you have to pay for something, fork out the money. In the long run, it will work out to your advantage as it will reflect in your products and services. Plus, they are all business expenses that you can use when you file a tax return. A good boss never cuts corners, and you need to realise that now you’re in charge.
Find Permanent Work
Although it sounds like a contradiction, it is possible to be self-employed and have a full-time job. Let’s break it down so that it’s easier to understand. As a freelancer, you need lots of work to pay the bills. And, it isn’t always easy to find sufficient work to make ends meat. The alternative is to find a client that offers full-time employment for you on a daily basis. In this sense, ‘full time’ means that the day revolves around one client. That way, your pay won’t be in jeopardy because the wage will be a constant, and you’ll have more security. Some freelancers don’t like this idea because it means they have all of their eggs in one basket. However, it is possible to keep an eye out for more work just in case the agreement breaks down. Also, clients tend to give a notice period which will give you time to find another regular.
Pay Attention, Literally
Doing the work is the easy part as well as the fun part; getting the money is the hardest. Now, no one wants to lay the blame at the feet of the employers, but they will take their time to settle their debts. Some are forgetful, some do business that way, and others are the take. As long as you get the money, though, it isn’t a problem, so with this in mind you need to get annoying. Set a payment date with your clients and make sure they honour it by hounding them relentlessly. If they don’t want to pay, they will in the end because of sheer frustration as people hate constant phone calls and emails. It is worth noting that lots of clients will pay on time, which means you will be the problem. Those of you that have plenty of work won’t always remember which client owes you money, and you can lose said money as a result. The secret is to make a list of every person that owes you money so that you don’t forget. Also, do it every week for consistency.
Want to know what the biggest mistake self-employed people make? It’s coming across as small and unprofessional. Lots of firms do it, and they do it because they have esteem issues. You know how big you are and feel as if you have to be open with the clients for some reason, but it’s nonsense. Speaking them like a small company will only make them view you in the same way, and it will affect your client retention. What you need to do is sound like a huge company even if you are only a startup. For example, say you’re ‘in a meeting’ when you have to pick the up kids, or you’re ‘out of the office’ when running an errand. The clients are none the wiser, but they like the terminology all the same. Should you have to meet them in person, dress to impress like a proper entrepreneur and bring along a friend. They might have nothing to do with the business, yet they give off the right impression.
Follow this advice and your career in self-employment will go from strength to strength.