Are you making the plunge as a new freelancer? Leaving the day job behind to strike out on your own? Feeling ready to conquer the world as a solopreneur?
Hold on. It’s true, freelancing can be many things: exciting, challenging, adventurous—the list goes on. But no matter how you look at it, one thing’s for sure: freelancing is very different than working as an employee. And when you’re first starting out, some details are more obvious than others.
Fortunately, you don’t have to start from scratch. We’ve put together a short list of six top tips to help you make a smooth transition into freelancing.
“Don’t try to get business from ‘strangers’ when you start out. It’s hard to sell yourself to people who don’t know you. Make it easier on yourself by asking people you know. It’s easier for them and for you, and it makes starting out less onerous.” Will H. / Twitter: @whawkins
Finding work is all about who you know, and who you submit proposal templates to. Freelancers still get the majority of their work through word of mouth, making it more valuable than marketplaces, agencies, or social media marketing. People who know you personally will be much more likely to give you a shot. Plus, you’ll feel more secure working with someone you can trust.
When you’re just getting started, you won’t have the big portfolio and proven reputation of someone who’s been in the game for years. Tap into your network. Then, build your brand over time before branching out to find additional clients.
As a freelancer, you will have to build a schedule that accounts for both billable and non-billable hours.
Billable hours involve time spent on tasks related to specific assignments: research & planning, client review meetings, and content production. Non-billable hours include things like bookkeeping, email, invoicing, and marketing. Not to mention time spent hunting for new job opportunities.
This means you shouldn’t schedule eight billable hours per day. You’ll still have to fit in your non-billable time on top of that! It probably makes more sense to set aside 4-6 hours each day for billable client work, and 2-4 hours per day on non-billable activities.
Whatever your hourly rate was as an employee, it’s time to double it as a freelancer. That may seem extreme, but you have to think of yourself as an employer instead of an employee. An employer provides a lot more than your base salary. They cover health insurance, PTO, office space, equipment, software, travel, taxes, and those hours that are now non-billable. That’s a lot to make up for.
Check out this great infographic from Creative Live that breaks down how to calculate your new rates. It may seem a bit scary, but remember that your time is valuable. Be prepared with competitive rates.
“Always be saving! Your amazing gig can disappear instantly and without warning. Plus, you’ll probably owe the IRS during tax season. So make sure you’re always putting some away from every paycheck.”Grant P / Twitter: @grantpa
Once you start making some real money as a freelancer, expect to start paying quarterly taxes, rather than settling up once a year in April. Also, since you’re now your own employer, you’ll need to start paying self-employment taxes. So start saving a chunk of each paycheck so you are hit with a big surprise at tax time.
In a full-time gig, you may have employer matching on your 401(k) plan to help you save for retirement. As a freelancer, you’re all on your own. Do some research on the different types of retirement accounts for freelancers and choose the one that’s best for you. Then: start saving.
You are now the project manager, the payroll team, and the administrative assistant. From project timelines and deadlines, to progress reports and updates, to estimates and invoices, you have to make sure everything gets done. You’ll save yourself buckets of time if you set up a consistent and reliable system with structure, reminders, and automation. Systems like Bonsai can help you to track your projects, contracts, hours, invoices and payments much more easily.
"Experiment as much as you can. Be open to new ideas and tips from other freelancers and blogs. Try out new tools and services that can help you create your perfect productivity ritual."Carrie Smith Nicholson / Twitter: @careful-cents
“Publish case studies of your work showing in detail your skills and how you solve problems.” Pablo M.
Your credentials, your resume(with your freelance work listed), and your list of skills and abilities are never as impressive as one thing: results. By creating case studies, you can show people exactly how you tackled a project. How did you solve a client’s problems? How did you go above and beyond to create a measurable impact?
Ideally, include concrete statistics to show the amount of revenue you created or time you saved. Ask for quotes from your clients that speak to your abilities. Add images and excerpts of your work. Even if you’re not a designer or a writer, you can take screenshots of just about anything: a chart of click-through rates, a graph of increased readership, or original code you wrote that led to success.
These are just a few of the many things you’ll need to learn as you move into the world of freelancing, but don’t worry! Just plan ahead, and take these tips into consideration before you start. You’ll be ahead of the game from the beginning.
Start managing your freelance business with Bonsai today - sign up for our free trial.
A verbal contract (formally called an oral contract) refers to an agreement between two parties that's made —you guessed it— verbally.
Formal contracts, like those between an employee and an employer, are typically written down. However, some professional transactions take place based on verbally agreed terms.
Freelancers are a good example of this. Often, freelancers will take on projects having agreed on the terms and payment via the phone, or an email. Unfortunately, sometimes clients don't pull through on their agreements, and hardworking freelancers can find themselves out of pocket and wondering whether a legal battle is worth all the hassle.
The main differences between written and oral contracts are that the former is signed and documented, whereas the latter is solely attributed to verbal communication.
Verbal contracts are a bit of a gray area for most people unfamiliar with contract law —which is most of us, right?— due to the fact that there's no physical evidence to support the claims made by the implemented parties.
For any contract (written or verbal) to be binding, there are four major elements which need to be in place. The crucial elements of a contract are as follows:
Therefore, an oral agreement has legal validity if all of these elements are present. However, verbal contracts can be difficult to enforce in a court of law. In the next section, we take a look at how oral agreements hold up in court.
Most business professionals are wary of entering into contracts orally because they can difficult to enforce in the face of the law.
If an oral contract is brought in front of a court of law, there is increased risk of one party (or both!) lying about the initial terms of the agreement. This is problematic for the court, as there's no unbiased way to conclude the case; often, this will result in the case being disregarded. Moreover, it can be difficult to outline contract defects if it's not in writing.
That being said, there are plenty of situations where enforceable contracts do not need to be written or spoken, they're simply implied. For instance, when you buy milk from a store, you give something in exchange for something else and enter into an implied contract, in this case - money is exchanged for goods.
There are some types of contracts which must be in writing.
The Statute of Frauds is a legal statute which states that certain kinds of contracts must be executed in writing and signed by the parties involved. The Statute of Frauds has been adopted in almost all U.S states, and requires a written contract for the following purposes:
Typically, a court of law won't enforce an oral agreement in any of these circumstances under the statute. Instead, a written document is required to make the contract enforceable.
Contract law is generally doesn't favor contracts agreed upon verbally. A verbal agreement is difficult to prove, and can be used by those intent on committing fraud. For that reason, it's always best to put any agreements in writing and ensure all parties have fully understood and consented to signing.
Verbal agreements can be proven with actions in the absence of physical documentation. Any oral promise to provide the sale of goods or perform a service that you agreed to counts as a valid contract. So, when facing a court of law, what evidence can you provide to enforce a verbal agreement?
Unfortunately, without solid proof, it may be difficult to convince a court of the legality of an oral contract. Without witnesses to testify to the oral agreement taking place or other forms of evidence, oral contracts won't stand up in court. Instead, it becomes a matter of "he-said-she-said" - which legal professionals definitely don't have time for!
If you were to enter into a verbal contract, it's recommended to follow up with an email or a letter confirming the offer, the terms of the agreement , and payment conditions. The more you can document the elements of a contract, the better your chances of legally enforcing a oral contract.
Another option is to make a recording of the conversation where the agreement is verbalized. This can be used to support your claims in the absence of a written agreement. However, it's always best to gain the permission of the other involved parties before hitting record.
Fundamentally, most verbal agreements are legally valid as long as they meet all the requirements for a contract. However, if you were to go to court over one party not fulfilling the terms of the contract, proving that the interaction took place can be extremely taxing.
So, ultimately, the question is: written or verbal agreements?
Any good lawyer, contract law firm, or legal professional would advise you to make sure you formalize any professional agreement with a written agreement. Written contracts provide a secure testament to the conditions that were agreed and signed by the two parties involved. If it comes to it, a physical contract is much easier to eviden in legal circumstances.
Freelancers, in particular, should be aware of the extra security that digital contracts may provide. Many people choose to stick to executing contracts verbally because they're not sure how to write a contract, or they think writing out the contract terms is too complicated or requires expensive legal advice. However, this is no longer the case.
Today, we have a world of resources available at our fingertips. The internet is a treasure trove of invaluable information, platforms, and software that simplifies our lives. Creating, signing, and sending contracts has never been easier. What's more, you don't have to rely on a hiring a lawyer to explain all that legal jargon anymore.
There are plenty of tools available online for freelancers to use for guidance when drafting digital contracts. Tools like Bonsai provide a range of customizable, vetted contract templates for all kinds of freelance professionals. No matter what industry you're operating in, Bonsai has a professional template to offer.
A written contract makes the agreement much easier to prove the terms of the agreement in case something were to go awry. The two parties involved can rest assured that they're legal rights are protected, and the terms of the contract are sufficiently documented. Plus, it provides both parties with peace of mind to focus on the tasks at hand.
Bonsai's product suite for freelancers allows users to make contracts from scratch, or using professional templates, and sign them using an online signature maker.
With Bonsai, you can streamline and automate all of the boring back-office tasks that come with being a freelancer. From creating proposals that clients can't say no to, to sealing the deal with a professional contract - Bonsai will revolutionize the way you do business as a freelancer.
Why not secure your business today and sign up for a free trial?