Being self-employed is a whole new world of pros and cons. Some of the pros include being able to work to your own schedule, enjoying meeting and sourcing new clients, having the satisfaction of building your business from the ground up, and being able to work from home.
However, the main con is that you may have to sometimes wear every single hat within your business. Whether it’s doing your own accounting, your own human resources management, or your own customer service, being self-employed can be really stressful.
Besides money, it’s also important for you to take care of your mind and spirit, no matter how busy or run-off-your-feet you may be. Here are 5 things that you should consider.
1. Make Sure That You Always Get Paid
If you’re working freelance in an area you’re passionate about, then securing the work and completing your projects is the fun part. Chasing after invoices and hassling your clients for weeks on end to pay you—definitely not as much fun. Keep a note of every piece of work you do (maybe in a fancy spreadsheet, if that’s your style) and tick off a task only when the money you were owed is sitting in your business account.
2. Give Yourself a Raise
As your level of expertise, skills, and time “on the job” increases, so should your rate of pay. If you were working in a conventional employee role, then you’d probably be having yearly meetings with your employer to discuss your progress (and any subsequent pay rises). If you’re self-employed, you have to do the same, except you’ll be the one appraising yourself! Your income needs to reflect your level of experience; otherwise, you’ll find that you’re chronically underselling yourself.
3. Master the Art of Budgeting
Setting a budget for your business can be really tricky. David Alexander, Director of Student Services at the International Career Institute, says, “Track your spending. We can lose track of day-to-day spending. View your bank statements on a weekly basis, create budgets, and use spreadsheets to monitor areas that are essentials vs non-essentials.”
If you’re concerned about negative cash flows because your customers aren’t paying you on time, then offer them incentives like discounts or free product to encourage them to sort out their bills sooner. Keeping all your business paperwork in order is also extremely important, as this could affect your ability to take out a home loan, make a big purchase, or even just rent an apartment from a landlord down the road.
4. Take a Break and Treat Yourself
When you’re self-employed, it’s so easy to just keep working, and working, and working. With no one except yourself to tell you when to stop working, it’s easy to try and finish your endless to-do list in a single day. For your mental health (and for the sanity of others around you!), it’s important to take care of yourself and ensure you’re doing things that you enjoy and that relax you, every day.
Gavin Slater, CEO of Nimble, says, “Travelling is one of life’s greatest pleasures, and there is an increasing number of benefits becoming associated with taking a well-earned break—for example, reduction of stress and a better mindset on returning to work.”
Slater further adds that “It’s also important to remember that travel doesn’t always mean getting on a plane. Make the most of your weekends by packing up the car and enjoy all that your state has to offer. Why not go on a ‘backyard adventure’ in the city you live in at least once every month? Then plan for bigger trips that incur more costs as a once-a-year special holiday treat.”
5. Reaping the Rewards of Self-Employed Life
Running a business can be a rollercoaster of emotions, with every day coming with its own ups and downs. Whether you’ve been running your own business for years or you’re finally thinking of making a career change, it’s important to be prepared for what this new financial venture might offer you.