How to get started with freelancing

While given in the context of personal advice, it has powerful relevance in the career and personal aspects of your life, too–especially if you’re white knuckling to a job you hate, year after year. When I first made the decision to leave the security of corporate America to build my own career as a freelancer and yoga instructor, I’ll admit, it was terrifying. Now nearly two years later, I’m amazed and thankful, that I took the risk and went for it. Do I make as much money as I once did full-time? No? Do I love what I do, and look forward to working every day, because it actually doesn’t feel like work? Indeed.

If the idea of ripping off those golden handcuffs has appealed to you for some time but you haven’t, it may be because you’re haunted by one question: How to start freelancing in the first place? I recently wrote an article published at the Elance blog on the topic called “Overcome your freelance fears.” Check that article out, and read a few more insights below on what I’ve learned over the past two years as a freelance writer.

Say good bye to your ego. Your resume may be stellar and your salaried paycheck rather fat, but none of that matters in the freelance world. That’s not to say that you shouldn’t hype the assets you’ve developed in your full-time career, or decide on a minimum base freelance rate, but freelancing is just like starting your own small business in the sense that you need customers to start building your career. Certainly there are clients out there who have  deep pockets, but until you build your own worth in the form of a freelance portfolio, they probably won’t be willing to take the risk. Shoot for the stars and market yourself to those you are truly want to work with–but don’t turn your nose up at other opportunities that could be a valuable stepping stone to your long term success.

Make sure you’ve got cash on hand. Would a full-time employer ever tell you that you’ll be paid every four weeks–maybe even ten? Probably not. But a freelance client will have no qualms about making you wait for payment, and though it stinks, there’s not a lot you can do short of walking away from the project. As you build more clients, you can play a little more hardball, and you’ll also learn to prioritize your workload and set your rates based on who will you pay quickly and competitively, and who won’t. (Hint: Treat your fast-paying clients extra well).  While waiting for a client to cut a check can be frustrating, it needn’t be something that wrecks your personal finances. Make sure you have enough cash reserves to pay your bills so you’re not adding an additional headache to your freelance ventures–or going into debt in the process.

concept of the coworking center, business meeting

Be prepared to work. I love what I do and I believe that is worth far more than a dollar amount, but make no mistake, I earn every penny. If you’re not willing to put in long hours to build freelance success, and handle additional activities like taxes, marketing, and invoicing, it’s not going to be a career path you enjoy.

Become a private investigator. I love the excitement of finding a new project as a freelancer. Trust, I’m not finding them on a job board. One of the top questions I’m asked as a freelancer is “How did you find that job?” The answer? I’ve become an expert investigator. You have to learn to put the bread crumbs together, reach out to direct contacts and sell yourself. If you’re poking around on job boards or freelance web sites, you’re competing with thousands of others who want the same opportunity you do. Even if you find them, you probably wont’ make much money–because the employer has many others like you to choose from. Put on your Nancy Drew hat and start snooping around! The internet has made it so easy to conduct research and find information that you only have yourself to blame if you’re not using it.

Financial Mistake #2: Not Living Below Your Means

You’ve probably heard of living within your means, and maybe you do. Perhaps you even sock away a bit in savings, and have started to pay more aggressively on your mortgage and cars, in order to build your assets and reduce expenses even further. All are smart move. But, the economic downturn and housing market bust brought a whole new axiom to what it will really take to build wealth  and financial security for future generation, and success is no longer deemed by whether you can stick to a budget; it’s about coming in under it. By how much, you ask? Like with most financial advice, different experts will tell you different formulas for success, but at the minimum, you should strive to come in below your budget by at least ten percent each month–in addition to making sure you’re on track for retirement and a solid emergency fund. Here are four ways to check in with yourself, to makes sure you are striving to live below your means.

Unless you’ve budgeted for it–don’t buy it. We all know that impulse buying is a key issue in managing finances. Impulse buying leads to purchases you haven’t thought through, which often indicates that you’re operating more on “want” than “need.” There’s also a good chance you’re paying more for an item that you could find cheaper elsewhere, had you taken the time to research. But most importantly, truly carving money aside for something is a good determination of how bad you really want it. Studies show time and again that people who pay with credit agonize far less over purchases and prices than those who part with actual cash, and impulse buying is no different from a psychological standpoint.  If you want something, put it in your budget before you ever buy. If the pain of seeing your numbers dip doesn’t deter you and you have the money, move forward. But, you’ll find that at least 25% of the time, certain expenditures lose their appeal when we consider what we’re losing in the transaction.

Pretend your emergency savings  doesn’t exist. You need to have at least six to eight months of your take home pay established in savings before you ever consider yourself “in the clear” financially. If you don’t have it, the primary function of your money should be spent on building savings, and retirement.

Stop telling yourself you “deserve” it. Avoid the trappings of telling yourself that you make enough money or work so hard, that you deserve to spoil yourself.  While I’m all for taking time to smell the roses, rewarding yourself but it doesn’t have to be financially or materially driven. Reward youreself by investing in your health, stress-reduction, forming positive memories, tackling goals, and personal fulfillment. Skip the reward of a pricey purse, or car, whose appeal will be short-lived, anyhow. (Science says so)!

Figure out exactly where you stand with retirement. You contribute a bit of your paycheck to your retirement, so you figure that you’re doing the financially responsible thing, right? Saving for retirement early on is certainly a wise financial move, but there is a number associated to how fruitful your efforts will prove–and you should know what it is as readily as you know your monthly take home pay. Financial experts generally concur that a person should realistically plan to spend 80% of their current income in retirement, in order to maintain a similar lifestyle. So, if you make $80,000 now, plan to spend $64,000  a year as a retiree-and more, if you envision travel and leisure in retirement.  That money will need to come from what you’ve saved, and whatever you can generate from that savings, in the form of dividends and investments,  social security (if it’s still around), and any work you can and want to continue doing.  There are online calculators that can help you to determine where you are and what you need saved, but there’s also an easy formula. Take what you currently make, and multiply it by 12. If you make $90,000 now, you’ll need to have at least $1,080,000 saved in retirement before you can ever consider yourself in the clear.

More Money Saving Tips on Summer Travel

I recently wrote an article for Mint.com called “How to Start Saving for Summer Vacation Now.” Here are a few more items worth knowing, to save some money on your summer vacation.

If you can..wait to book your air travel.

In my article, I mention to value of doing some research on the realistic price you’ll pay for flights, and that you should budget for that amount, considering any additional savings you find as “icing on the cake.” But, ARC recently conducted a study that identified six weeks out from your vacation as the time when flight prices might actually be lowest-5.8% lower than the average price, to be exact. “Many people have long thought that the further out from your flight that you buy an airline ticket, the less expensive it will be. Our data indicates that this isn’t necessarily true,” said Chuck Thackston, managing director of data and analytics at ARC. “Although low fares are available over the 120-day cycles in 2011 that we analyzed, the vast majority of tickets costing below the average fare were purchased about six weeks before the flight date. “We’re not advising people to purchase tickets only at this time during the cycle as there is no guarantee they will receive the lowest price of the year; it is just what the data indicates and we have seen this pattern over the last four years.”

Don’t Believe What Your Read About Hotels

I regularly consult TripAdvisor for information on hotels, because (I thought) the information was fairly accurate, given that it is coming from fellow travelers. Turns out, my assumption was a bit naive. According to Econsultancy.com, TripAdvisor has been accused of providing information from so called “travelers” that isn’t necessarily true. Obviously, the site is not to blame for people who posted reviews and posed as travelers, but at least in my mind, it does bring a little pause to how much I’ll use the site going forward. The moral of the story? There is still a place in this world for travel agents, especially if you’re traveling to a new destination, or have a specific “ambiance” in mind.

4 Quick Steps to Better Emails

It’s been estimated that the average email user gets 147 email messages a day. Here are four ways to make sure yours don’t get deleted on contact.

1. Send them early. According to the makers of email plugin Boomerang, most people prefer to read emails before they begin to work, around 5 or 6 am. The plugin allows you to schedule when you send and receive emails, so yours can be at the top of a recipients’ inbox when they’re most likely to check their messages.

2. Don’t get cute with subjects. Particularly if you’re sending an email to a new client, don’t get too cute in your subject lines. As a writer, I get constant emails from PR firms, and I can tell you from experience that I’m instantly turned away by “cutesy” wordplay. Get to the point, or don’t bother. Additionally, avoid words like confirm, assistance, and join. Research shows they are more likely to get trashed.

3. Don’t get too comfy. With Blackberries and iPads a staple of modern life, it’s to be expected that electronic communications have gone informal. But, consider the recipient before you “dumb down” your approach. If the email is not intended for a close friend or colleague, pay attention to your grammar, syntax and word choice. Email is still a reflection of your skills and professionalism, despite its commonality.

4. Use your signature. Your signature tells a user who you are and what you’re about. Keep it short–no more than four lines. When embedding a graphic or logo, make sure that you test it in a variety of email clients; they don’t all translate the same. If you’re including a link to your blog or site, include the full link in your signature to avoid any lost data transmission.