Five Pros and Five Cons of Being a Freelancer

by Staff & Contributors

Deciding to be a freelancer is more of a personal choice. The knowledge of the pros and cons can simplify the decision for you. In today’s time, the growth of freelancing and freelancers is uncontrollable.

In a survey conducted by Upwork, approximately 56.7 million people freelanced in 2018, which is more than one in every three people. More so, the younger generation is more inclined to freelancing than the other generation.

Between the age group of 18-34 years, approximately forty-two percent of people freelanced in 2018. This number was thirty-five percent in 2018 and thirty-four percent in 2014. There has been a slight downfall in the number of older people taking up freelance jobs.

If you are interested in becoming a freelancer, we recommend you consider the following pros and cons. This can help you decide whether the decision is right for you or not. So, let us get started and address the pros and cons one by one.

 

Pros

You have higher freedom in performing and scheduling the work.

As a freelancer, there is one positive that I think all freelancers see and appreciate. This is that they have the flexibility to select their schedule,’ comments Rosy, a freelancer with RazorHood, who has written comparison reviews, such as Oneblade vs. Oneblade Pro for their website.

IRS defines an independent contractor as someone who the company does not direct in terms of methods and the means. Hence, they can work more naturally and have greater freedom in their schedule than full-time employees.

Further, the independent contractors work more prevalently on a project-by-project basis. So, they receive the payment following project completion.

 

Reduction in the drive time

Think of a situation wherein all of us could eliminate the unnecessary expense and the pressure on the bank accounts just to move to and fro from work and back every day.

‘On average, when I was working with a company as their full-time employee, my gas expenditure amounted to 345 USD per month. It did not include any other miscellaneous trips either,’ comments Sara, a Freelancer who writes reviews for MyPlumbersChoice, such as the best tankless toilet review.

 

Money

When you work with a company, you see a yearly hike in your salary. This may be a small hike, but it is there. On the other hand, when you are a freelancer, you can always demand more hikes depending upon your work quality.

Of course, that does not overrule the fact that your prices have to be competitive. However, after you have established yourself in the market as an expert, you can make more money. This also means that the more projects you take or, the more significant projects you take, your take-home money will be better.

More so, if you are running a business as a limited company, you will be taxed lesser than if you were an employee.

 

You can have more than one income source.

Back in the day, stability was synonymous with a full-time job. However, with several industries seeing a downward trend, such as manufacturing and journalism, freelancing is today a vital financial buoy.

The major pro with freelancers is that they can have diverse income streams. So, if there is a decline in one income source, it will not directly hamper your livelihood.

Many freelancers claim that after becoming a freelancer, they earn more than their full-time jobs, and it is mainly because they have varied income sources.

More so, if, as a freelancer, you establish yourself and have strong contacts, you can decrease or increase your workload as you please.

 

You are your own boss.

Lastly, when you become a freelancer, you no longer work for people. You are self-employed. So, there is no boss. However, this does not mean that there is no accountability. You are accountable, but only to your clients and, of course, to yourself. There is no one micro-managing or hanging over your head.

Hence, making tough decisions is solely your responsibility, and you have absolute control over things.

 

Cons

Taxes

Let’s start with the obvious. Regardless of the money make, be it as an employee or a freelancer, Uncle Sam gets a share of it. However, freelancers have an additional responsibility of paying the self-employment taxes. These taxes are to be paid quarterly.

Moreover, freelancers also have other deductions, which the employees do not qualify for. As the taxes can be a disadvantage, you need to understand the law and regulations when setting the rates carefully.

‘Even though I am supposed to pay self-employment taxes, the deductions make up for this extra expense,’ comments Ronny, a freelance reviewer for EmbraceGardening who reviewed the best fertilizers for palm trees

 

You do not get the minimum wage.

As an independent freelancer, your payment is on a project basis. Hence, there is no guarantee of the hourly rate. It may or may not be greater than the minimum wage.

 

No fixed date for salary

‘One of the biggest disadvantages of being a freelancer is that you do not have a fixed day of receiving the payments. You may get it after a month, 45-days, or 60-days. It all depends from one client to another,’ comments Daisy, a freelance writer who offers online summary statement engineers Australia service.

Thus, regular jobs are savvier when it comes to financial stuff. With a freelance job, you need to be extra cautious.

So, before taking the job, you should get clarity from your client about the payment period and the mode of payment.

 

Loneliness

When you are all by yourself, every day, there are no colleagues and no people to communicate with, when you take a break. So, you are all by yourself when you work. This can be pretty lonely at times. So, this is another common con of freelancing.

 

No employee benefits

Lastly, a massive con of freelancing is there are no employee benefits. If you take an off, or you are sick, you won’t get paid. There are no paid leaves, no emergency fund, nothing. Other benefits that you miss out on are private healthcare benefits, pension schemes, etc.

Hopefully, with the knowledge of these pros and cons, making a decision will be simpler.

Previous post:

Next post: