My freelance journey began just five years ago. I was working full-time in an insurance office and had just finished massage school. I dreamed of working for myself, but thought I’d never be able to break free of the corporate world.
During one of my continuing education classes, I met a guy who had just begun submitting content to an online article network. He suggested I check it out because they “paid people to write.”
Never one to turn away a few extra dollars, I began to submit content and made a little bit of spending money. I suddenly started to wonder if I could really make a living with my writing. I stumbled upon Elance, created an account, and landed a couple of gigs. One turned into a long-term relationship that lasted for more than two and a half years. Before long, I was calling myself a freelance writer.
My workload began to grow and I suddenly started to wonder if I really could quit my job and freelance full-time. I toyed with the idea and spent countless hours toiling over my finances. Could I afford to quit? Would I find enough business to support my lifestyle? The serious questions were always about money. In this post, I’ll share what I learned about managing money as a freelancer and how what I learned helped my freelancing career.
Making the Leap to Full-Time Freelancer
It was July of 2008. I opened my email to see a note from the vice president of the company I was working for. We needed to schedule my annual review.
Instead of returning a confirmation, I requested an immediate meeting. I explained that I was not just leaving the company, but the industry as well. He was curious about my ventures and accepted my resignation graciously. I gave them more than a month’s notice and we even worked out a deal where I returned for two months–as a freelancer–for a limited number of hours each week to help cover vacations and to train my own replacement.
September of 2008 found me officially on my own. Life was good.
My Struggle with the Shiny New Object Syndrome
There was just one teeny tiny little problem. I developed what many in the Internet marketing industry refer to as “shiny new object syndrome.” In my efforts to grow my business and find methods for earning passive income, I found myself investing in a series of products I thought would help my business. Some did. Some didn’t. Some sat in folders on my desktop for inordinate periods of time. In the end, I was spending all of my profits instead of creating a savings account and my business was not growing the way I had imagined it might.
The reality of the situation is that I am not the only person who has ever suffered from “shiny new object syndrome”–the urge to try product after product (software packages, eBooks, marketing services, etc) before determining if the one before it was valuable. Some will go from their profits to their credit cards, digging themselves into an even deeper hole. Many new freelancers fall into this trap and, unfortunately, not all will realize what is happening before they’ve created a ton of debt.
Four Tips to Help You Avoid the Syndrome
My advice to new freelancers?
- Stick to what you know–Especially in the beginning. You are obviously doing something right or you wouldn’t be freelancing. Allow yourself to grow some roots before you look to expand or grow your business, especially if it means exploring uncharted territory or making a serious financial investment.
- Don’t over-invest–I had a wonderful vision of what my business office would look like and I wanted to run out to Office Max and Ikea and buy every organizational tool known to man. I wanted to upgrade my operating system, find better word processing programs, and invest in webcams, digital cameras, and anything I thought would add value to my work. I soon realized that if I really needed those things I would not be preparing to quit my job and that my working tools were acceptable for the time being. Don’t waste significant amounts of money on tools you don’t actually need. You can always upgrade your business later on, little by little, as you grow.
- Be realistic–I knew that my income during my first couple of months in the freelance world would not immediately match my income from the corporate world. I did my best to eradicate debt and create a small savings account before I quit my job. I also spent a ton of time scouring grocery store ads so that I could stock my cabinets with 10/$10 deals. No matter what happened, I was determined not to starve.
- Don’t trust everyone–I spent months reading articles on blogs like Freelance Folder and learned a ton about the freelance world. I also spent a ton of time on the blogs of well-known internet marketers and I began to trust them. I trusted them so much I would buy the products they recommended just because they promised I could make money with them. I didn’t realize–until hundreds of dollars later–that most of these guys had never even seen the products they were recommending. They had simply built a trusted brand and well, I fell for it.
I wish that every new freelancer could be blessed with a personal financial advisor. If that were possible, so many would be saved from the experiences I had–of wasting money and digging myself into holes while believing I was helping myself to grow. In the end, real growth didn’t happen until I was able to trust myself and my skills. Now my bank account and I are both much happier.
How do you decide which freelancing tools to buy and which to pass on? Share your answers in the comments.
Image by Matt Lilek