Freelancing offers many perks for a lot of people: the freedom to choose your work hours, explore different projects, have a better work-life balance, and not have to deal with the notorious rush-hour traffic among other benefits. In fact, there has been an increase in the country’s “gig economy”. However, starting or shifting into a freelance career demands thorough preparation. If you’re planning to enter the freelance world, you better prepare for these drawbacks:
1. You’ll have an unstable income and an unpredictable workload.
The truth is, being a freelancer could mean having an unstable income and workload. Unlike the regular job settings, your earnings depend entirely on the amount of work you do. Since most freelance jobs are project-based, you may encounter months where gigs are overflowing and months there’s hardly any project at all.
What you can do: If you have regular expenses like dorm rents and other bills, you need to manage your finances carefully. Budgeting and spending wisely will help you stay afloat. On the other hand, one good thing about freelancing is that you have control over your income flow. If you’re running short of budget, you can ask for extra works, look for more clients, or adjust your rates.
2. You won’t have other benefits.
Other than their salary, freelancers often don’t receive employer-benefits like SSS, PhilHealth, Pag-IBIG, and health insurances. So you’ll have to pay these on your own. Taking a sick or vacation leave can take a full day’s worth of salary, too since well, no work, no pay.
What you can do: Have an emergency plan in case you get sick or have last-minute errands. Since you won’t get paid unless you work in a day, make sure you have enough funds to cover your expenses.
3. You need to process admin tasks on your own.
Freelancing also requires a lot of legwork from finding your own clients, networking, filing your income tax returns, paying your monthly contributions to social insurance funds, and processing your legal documents as required by law.
What you can do: As a freelancer, you need to have your own library of resources and database of government forms. Fortunately, you can now pay SSS, Pag-IBIG, and PhilHealth online while BIR also has the Electronic Filing and Payment System. It would be helpful to have a calendar of the government-mandated documents that you need to file to avoid penalties. Here’s your comprehensive guide to government IDs.
4. You need to prepare for work-from-home distractions.
Being your own boss is one great perk of freelancing. You can work whenever you want to and do tasks at the comfort of your own home (or working space). But the flipside is it can be hard to set a clear boundary between work and your personal stuff. You need to constantly keep yourself away from distractions like TV, house chores, social media, and others.
What you can do: Treat your freelancing job as if you’re in a regular office in a way that you set a definite time when you should be working. Dedicate a room or space in your home where you won’t see or hear any potential distractions when doing your work. Make sure it is well-lighted and properly ventilated.
5. You have to invest at the start.
Jumping into a freelance career can be costly at the start. You need to provide your own tools and resources like a working laptop, internet connection, office equipment, and software. Since you don’t have any office, there may come a time when you have to go to a coffee shop to look for a quiet place and reliable internet, which might lead you to spend more than you should.
What you can do: Before you plunge yourself into freelancing, consider first how much you will be needing to set up your career. You may try joining freelancer groups and exchange your resources with the members. Who knows, they might have software resources which you can get for free?
Being a freelancer can provide you with unique learnings. However, you need to consider all aspects carefully. Take some time and examine all the potential drawbacks provided above and see which are the best ways to deal with them.
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