After all, who doesn’t want to be their own boss, have a flexible schedule, and avoid commuting in traffic every weekday? But before you make the switch, consider these eight risks of freelancing you’ll have to bear if you choose to pursue it full-time. Let’s take a look. You might end up changing your mind.
1. Unstable Income
The biggest challenge you’ll face as a freelancer is having an unstable income. This is the biggest difference between employment and freelancing. In the former, you get a fixed monthly salary; in the latter, you get paid based on the number of clients you have, the projects you take on, and what you charge for your services.
If you’re planning to become a freelancer, you have to be willing to tolerate risk and financial instability. Even experienced freelancers who have been in the business for several years sometimes find themselves struggling financially.
To mitigate this risk, start out by freelancing as a side hustle. This way, you can still earn a steady paycheck while simultaneously pursuing freelancing for extra income. After some time, if the latter becomes more lucrative, you can make the switch.
2. Inconsistent Workload
One thing that pretty much all freelancers complain about is having an inconsistent workload. One month, you might find yourself completely overwhelmed with work, and the very next, you might be struggling to find work.
Luckily, this is a solvable problem. There are many project management tools out there that can help you organize your tasks and avoid wasting time to maximize your productivity. Depending on your goals and lifestyle, you can create a schedule accordingly.
You can also charge clients extra who want their projects done urgently, and offer small discounts to those who are willing to push the deadline to fit your schedule.
3. No Benefits
While an employer might shower you with all sorts of benefits such as paid leaves, health insurance, retirement plans, and more, a client will never bother with such things. Why? Because their relationship with you is limited to their current requirements.
Once these requirements are fulfilled, their interest in you will expire, and you have to be okay with this. It’s up to you to decide how many leaves to take and when. You’ll also have to plan your retirement all by yourself, which is trickier with an unstable income.
4. Highly Competitive Industry
Platforms like Fiverr, Upwork, and Freelancer have made it really easy for clients and freelancers to meet and do business together. They’re like the LinkedIn of the gig economy. However, as helpful as they are in helping you find lucrative gigs, they also make it difficult for you to stand out.
Due to the ranking system of these sites, experienced freelancers keep getting new projects, while newbies tend to get ignored. It’s a key reason why new freelancers can’t find clients. Often times, the only way for a newbie to get clients is to offer their services for dirt cheap prices, which is not a sustainable business model.
5. Isolation and Loneliness
Over time, the isolation that comes with being a freelancer can be really harmful to your mental health. As an employee, you talk to your coworkers on a daily basis about work and non-work-related matters, which keeps your social needs fulfilled.
But as a freelancer, most of your time will probably be spent working alone at home without any external input. To solve this, you can work at public parks, enter volunteer programs, network with other freelancers, or join a coworking space.
6. Increased Responsibility
Being your own boss is a great feeling, but it doesn’t come for free. Although you’ll enjoy greater control over your time and income, you’ll also have to find new clients, create contracts, set your own deadlines, figure out what to charge, and a lot more, all by yourself.
You’ll also have to build a portfolio, market yourself, negotiate with clients, manage your projects, and continue to upgrade your skills in the meantime. If all this sounds super stressful to you, it’s a sign you’re not ready to be a freelancer and are better suited for a job.
7. Fuels Procrastination and Sedentariness
Since you don’t have to report to a manager, freelancing can make it really easy to procrastinate and avoid your due tasks. Downloading to-do list apps can help, but frankly, they are not a replacement for genuine work ethic and discipline. You’re going to have to teach yourself how to stay focused without needing external supervision.
Also, since you’re not having to commute to work or get dressed, freelancing can lead you into a lazy, sedentary lifestyle. It’s common for freelancers to work in bed, which we don’t recommend. It’s better to set up your home office, so you have a designated area for work.
8. Price-Skill Mismatch
Pricing is difficult for every business, from freelancers to corner shops to multinational conglomerates. And if your prices are not apt to your skills and experience level, converting clients will be a lot harder.
Initially, your priority is to build a solid portfolio and get positive client testimonials. You can do this by temporarily setting low prices to lure clients in and leverage them in the future as evidence of your reliability in converting high-paying clients.
Freelancing Is Not for Everyone
For most people, having a job with a steady paycheck is way better and less problematic than being a freelancer. However, if you can tackle the risks we saw above, freelancing can prove to be more profitable, more fulfilling, less stressful, and more liberating.
But in order to tackle these risks, you’ll need to learn some skills that you might not have bothered to learn as an employee, including logical reasoning, problem-solving, quick thinking, self-learning, and more. The more skilled you are, the easier freelancing becomes.
