Many permanent employees dream of going freelance and enjoying the benefits that come with it. But it looks like millennials are making plans to turn that dream into reality. In a survey by MetLife, 74% of younger workers say they're interested in becoming freelancers, and 40% of millennials say their intention is to leave their full-time jobs within the next five years in favor of independent work. Incidentally, 23% of Gen Xers and 13% of baby boomers claim to have the same plan.
Of course, there are numerous perks to being a freelance worker, like the ability to be your own boss and enjoy whatever flexibility you need in your schedule. But before you take the leap into self-employment, here are a few things you should know.
1. It may take some time to build up your business
Some people jump into the freelance lifestyle and are surprised when they find themselves struggling to drum up business. Even if you have solid experience, some companies don't like working with freelancers and prefer to do their business in house. Others might already have a team of freelancers they rely on, thereby making it difficult for you to break in.
Marketing yourself and establishing a client base takes time, so don't expect a jam-packed schedule your first few months in the freelance world. On the other hand, if you make a point of networking and getting the word out that you're going solo before you leave your full-time job, you may have an easier time ramping up. Just be careful, though -- the last thing you want is for your employer to discover your plans and let you go when you're not ready.
2. You may end up working more hours once you go freelance
Many people are drawn to the seemingly laid-back lifestyle freelancers are said to enjoy. But actually, you may end up working more hours once you venture out on your own. Don't forget that when you're self-employed, you're responsible not just for the actual money-making work you do, but for the administrative tasks behind it, whether it's paying your own vendors, invoicing clients, or stocking up on essential office supplies.
Furthermore, because freelance work can be hard to come by, you may find it hard to turn down projects even when you're already busy. When this happens, you're likely to find yourself working evenings and weekends just to keep up. This isn't to say you should be discouraged by the notion of hard work -- just know what you may be signing up for.
3. You'll need solid savings to get started
One major drawback of going freelance is losing the steady paycheck you've come to rely on. Furthermore, unless you sign long-term contracts with a number of major clients, you may come to find that your income fluctuates significantly from one month to the next. That's why it's crucial to go into a freelance arrangement with a healthy level of emergency savings. This way, if you have a couple of months without much work, you'll have the means to pay the bills.
You should also go into your venture with a decent chunk of money earmarked specifically for starting your business. You may need to spend a fair amount on marketing, business filing fees, and equipment to even start taking on clients, so make sure you're ready financially before leaving your full-time job behind.
There are plenty of good reasons to go the freelance route, and clearly, it's a trend that's quickly gaining traction. Just be sure to start off prepared and know what you're getting into so you don't come to regret that decision later on.