Common Obstacles You Should Know About Before You Start Freelancing

According to an Upwork survey, 57 million Americans freelanced in 2019. Freelancing is becoming increasingly popular, due in part to the rise of the gig economy and increasing remote options. Freelancing boasts many benefits, primarily flexibility, and independence in your work life, as well as a potential increase in income. However, while there are many benefits, there are also many factors that someone interested in freelancing should take into consideration to enjoy a successful career. Just as with any career choice, you should understand the potential pitfalls and how to avoid them, whether you want to freelance as a side hustle or intend to launch a small business

Legal Matters

Business law can be difficult to navigate for entrepreneurs. Freelancers are considered sole traders, which means that if they are challenged legally, they as individuals are taken to court, rather than a separate business entity that they represent. Therefore, it may be helpful to take measures such as creating an LLC, so that their business and private interests are separated. 

As for their interests as someone working on a freelance basis for larger companies, it is important to note that employers are not required to offer gig workers coverage such as workers’ compensation, although they can choose to offer workers’ compensation to independent contractors on an elective basis. Therefore, it is very important to understand what protections the companies you work for provide, and/or to negotiate such terms before you begin work for them. 

Company Benefits

Generalized company benefits are another thing that you will want to negotiate upfront when starting work for a company. Companies are not required to offer benefits to independent contractors, although they can choose to on an elective basis. However, it is important to note that even if they do choose to do so, those benefits are not tax-free for an independent contractor. Furthermore, while some organizations may offer benefits such as health insurance, the contractor will still miss out on benefits such as paid time off, sick days, and culture perks.

Money Management

Freelancing can offer significant benefits in terms of flexibility in your work life. However, the trade-off is that it also poses many drawbacks in terms of additional work that will fall on your shoulders, that would otherwise be handled by your employer in a traditional company structure. One such task is money management. 

You will not only have to carefully track your income and expenses, but also communicate with clients about payment options, and understand what corporate tax benefits are applicable for your business expenses. Additionally, because freelance work is not always consistent and you have to pay your expenses, it is prudent to maintain an emergency fund to float your operations if necessary. 

Client Acquisition and Retention

One of the most difficult components of freelancing is client acquisition. There are many measures you can take to accomplish this, including:

  • Identifying your target audience;
  • Finding your audience, whether online or in-person;
  • Collaborating with well-established organizations;
  • Creating a website;
  • Running an email outreach campaign;
  • Offering discounts and special offers for new clients;
  • Using freelancing websites;
  • Networking.

Just as important as client acquisition is client retention. Strategies for this include:

  • Establishment of customer service KPIs;
  • Use of a customer loyalty program;
  • General professionalism;
  • Action based on client feedback;
  • Frequent communication with clients;
  • Personalized communication;
  • Creation of a newsletter;
  • Follow-through on promises;
  • Utilization of customer service tools.

Time Management

An effective time management strategy is vital for freelance work. As freelancers set their schedule and often work on multiple projects at once, it can be difficult to maintain a good work-life balance. Effective options for time management include:

  • Using time management tools;
  • Creating a routine;
  • Ensuring that clients understand your boundaries for time;
  • Allowing yourself regular free time;
  • Utilizing a consistent timeline for billing clients;
  • Creating an organized, distraction-free workspace;
  • Adjusting your schedule based on how well specific time management strategies work for you.


Few individuals have enough money to launch a full marketing campaign for their freelance work. Therefore, it is important to understand and prioritize some basic marketing options that can be pursued with limited resources. These options include:

  • Creating a logo;
  • Establishing a brand identity;
  • Networking;
  • Leveraging social media;
  • Starting an email outreach campaign;
  • Using infographics;
  • Maintaining professionalism;
  • Developing a client onboarding checklist.

Project Expectations

In addition to generally communicating with transparency and authenticity, you must ensure that clients have clear, specific expectations regarding your products and services. Before starting a project, you should provide the following information:

  • Timeframe;
  • Deliverables;
  • Your availability;
  • Contact information;
  • Your understanding of their goals.

You should also ask the following questions:

  • What is your KPI?
  • Is there a target audience, and if so, who is the target audience? 
  • What is the deadline?
  • How can I contact you?
  • When can I contact you?
  • Is this work part of a larger project?
  • Have you had similar work done in the past?

It is also important to understand that because freelancing offers so much flexibility in your work life, the considerations that are pertinent to you will depend on your unique freelancing path. Therefore, it is vital that you understand all possible considerations, as you plan out your freelancing career path or make changes to that career path.

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