A year ago, I took the plunge and quit my job to be a full-time freelancer. It was a bold, scary move considering I was and still am in debt.
Of the many reasons I chose self-employment, flexibility and increasing my income were paramount in my decision. I believed I could make more money on my own since I worked low-paying nonprofit jobs for the bulk of my career, making roughly $30,000 per year. I’m happy to report I’ve accomplished that after a year, and more of that income is going towards paying off debt too.
Although I’ve reached my goals and have more balance and am earning more, it’s not been without trial and tribulations. I feel like I’ve been on an accelerated learning curve the past year, navigating the uncertain waters of freelancing.
Here are the top things I learned in my first year as a full-time freelancer.
Let Go of the Employee Mentality
I was still very much stuck in the employee mentality when I first quit. It was hard to embrace being my own boss. For the first few months, I felt like I had 10 bosses (clients) instead of one.
I later realized I still felt insecure and unsure about how to assert myself. I started to practice being more confident and embracing the idea of being my own boss, and I also let go of being insecure or feeling guilty for not responding to clients right away. I did things in my own time, which made all the difference in the world.
It’s easy to stay in the employee mentality when you first start out — you’ve likely lived your whole life as an employee, so it’s hard to transition to being your own boss.
But I realized that I had to embrace being my own boss and doing things my way in order to keep my sanity and run my business effectively.
Save More for Taxes
One of the unfortunate things about being self-employed is how much you pay in taxes. Self-employed people have to pay their own medicare and social security taxes as well as quarterly taxes. Ouch.
I have to admit, I didn’t do a lot of research regarding the self-employment tax, so I was shocked when I realized I had to pay more this year in taxes. In a traditional job, your employer will pay half of your social security and medicare taxes, and you pay the other half. Being self-employed means that you are your own boss and employee, so you pay both!
Understand When Things Aren’t Working
My first two months of freelancing were tough. I took on this work-at-home gig for 20 hours a week. It was one of the main reasons I felt confident quitting my job, because I could replace my current income with it. However, I quickly realized it was not the right gig for me. I was stressed out about the work and the whole thing didn’t jive with my values.
It felt like I was back to being an employee, but worse. The gig wasn’t right for me, but it was my security blanket to become self-employed. What would I do without it?
I realized I had to stay true to why I quit. I wanted freedom, flexibility, and to work on gigs that inspire me. This gig offered none of those things. So, with a leap of faith, I quit that gig and opened up 20 hours in my work week.
After that, I hustled hard to get additional work. To my surprise, I easily found other opportunities that were aligned with my values. It seemed that as soon as I let go of the things that weren’t working, I had time to let in other things that would work.
It’s like clinging on to an old relationship that doesn’t have a future. You are never going to find the right thing, if you stick with the wrong thing.
Try New Things
When I quit my job, it was with the intention of being a freelance writer. Sure, I’d be open to other opportunities, but I’d mostly be a writer.
After a year of freelancing, I’ve dabbled in other things like being an editor, social media manager, and event organizer. Doing those things helped me spread my wings and try new things. Most importantly, I’ve diversified my income.
You may go into freelancing thinking you will do one thing, but it’s important to try new things, grow, and expand your business. By creating work of value for my clients, I got to try out new things I wouldn’t otherwise have the opportunity to do. It’s been such a rewarding experience.
Throughout this past year, I’ve learned a lot about myself and what I want and what I need. I’ve grown in ways I feel I could not have at my old job. All in all, I haven’t regretted it one bit.
Are you self-employed? What has been your greatest lesson so far?
{ read the comments below or add one }
I can only imagine how awesome it would be too work from anywhere. The freedom of being a freelance writer must be very rewarding. Not too mention being able earn as much as you want .
I’m not going to lie – the flexibility is awesome. But it’s also a two edged sword. When you can work anywhere, you tend to have pressure to work all the time too.
Still, it’s worth it to pursue earning income that lets you do it anywhere in the world!
A “side hustle millionaire” in the making embraces change and goes through awesome challenges so they never go back where they started. Sometime you have to to reorganize yourself. But that’s ok too because with every experience, something new is learned. Too much quiet $ gUaP $ to be made online. 🙂
I’m in a similar situation. After working full-time in retail since the age of 18, and trying to juggle college classes last year to finally work on my English degree, my husband’s job opportunity here in WA have allowed me to quit my (unfulfilling) job and concentrate on building a freelance career! I’ve only been at it full-tilt since May, but things are starting to take shape. I may find something part-time to get out and active, but it will be fun, and my focus will be freelancing. Thanks for sharing what you’ve learned! I haven’t dealt with the tax issue yet, particularly because I don’t have a steady income yet, but my husband is having more taken out of his paycheck, so that will help.
Mostly, I’m learning to step out and do things that are uncomfortable or new, because they could mean great opportunities!
Thanks for sharing. Ever thought of negotiating a severance package instead of quitting? I’m trying to get feedback on why more people wouldn’t want to walk away with some money in their pocket to provide a longer runway for entrepreneurial or other activities.
Thanks!
Sam
Hmm interesting thought. But I’d have to be laid off to get a severance package, right? My employers were all nonprofit, so even with a severance, I doubt it would be a lot. Quitting felt like the right thing to do.
These are great lessons, especially how it’s OK when freelancing to leave things that don’t work for you. That’s the whole point!
Yes, if it’s not working, move on!
Saving more for taxes is huge!! You really don’t understand how much you have to pay in when you are self-employed. My first year I saved 20% for taxes and then put a good portion of my earnings into a business savings account. I’m glad I did because even with saving 20% for taxes I was still short $2K! I now save 30% for taxes and usually still owe a small amount every year.
It’s so important! 30% is a safe bet.