Nearly 70% of Gen Z Freelances or Plans To. Should You?

Fiverr, a freelance marketplace, recently conducted a study that examined how Gen Z thinks about work and their careers. The study examined how layoffs, technology, and a need for flexibility impact the generation's work preferences.

Many Gen Zers are already doing or considering freelance work. We'll share some interesting stats from the study and discuss the benefits of freelancing so you can decide if this career path is worth exploring.

Over 70% of Gen Z is thinking more about freelancing

Fiverr's second annual Gen Z report shows the generation is embracing or leaning into freelance work. For the study, more than 10,000 people between the ages of 16 and 26 were surveyed worldwide. Half of the respondents were workers in the U.S.

The study found that over 70% of Gen Z respondents think more about freelancing than last year. The poll also showed that many Gen Zers feel freelancing is more stable than a traditional full-time job. However, like traditional workers, freelancers can lose work with little notice, so it's always a good idea to have savings stashed away in an emergency fund so you're financially prepared.

Nearly 36% of respondents feel freelancing is an excellent backup plan if they lose their job due to layoffs or AI technology advancements. The study also found that almost 70% of all Gen Z respondents are freelancing or plan to start freelancing.

Flexibility is key for many Gen Z workers, especially Americans. In fact, 20% of U.S. respondents said they work to live, not live to work. It makes sense why this generation is embracing freelance work: This lifestyle can offer greater freedom and flexibility than a traditional career.

Freelance life can impact your finances

Before jumping into freelance work, consider how your personal finances will change. Some freelancers earn more than they previously did in an employee role. Earning more money could be a win for your bank account balance. You might also find it easier to reach your financial goals faster.

However, there are other financial changes to consider, too. For example, your tax situation will look different if you're a U.S. freelancer. Employees have their taxes deducted from their paychecks, but freelancers are considered independent contractors or self-employed workers. That means they must save up for and make their tax payments themselves. The IRS requires workers to pay taxes as they earn money. As a self-employed worker, you should make quarterly estimated tax payments. Otherwise, the IRS will charge you penalties.

If you're considering freelance work, whether part-time or full-time, you should first research how your taxes will change. If you need tax help, contact an accountant.

Should you freelance?

Freelancing could be a good fit if you value flexibility and freedom. But remember that growing any business can take time. If you're looking to shift into freelance work, consider starting with freelancing part-time while you continue working a full-time job.

This can give you added financial stability as you learn and grow. If you need help determining what freelance work would suit you, give yourself time to experiment and find what work aligns with your interests and skills. Don't be afraid to try something new.

Learning new skills and picking up freelancing projects could help you transition into a more rewarding career. For additional financial tips, check out our small business resources.