Freelancing or consultancy give freedom and responsibility

MANY people are considering becoming freelancers or consultants in the current economic climate.

Some want a change after reassessing their job or life situation postlockdown. Others find themselves out of work or they need to top up their income by getting paid for their “side hustle”.

Whatever the reason, the life of a freelancer or consultant is different from being employed. You shouldn’t rush into it without considering the practical and holistic differences. There is a certain “Yin/Yang” quality to it the concept of two halves seeking a new balance in each other. end. Being a freelancer or consultant involves higher rewards and greater risks. It means you . . .

Are responsible for yourself. You do your own invoicing and set your pay rate. You maintain your own insurance and whatever licences your industry requires. You pay the Government for your taxes, student loan and ACC levies.

Decide what work you do. You must negotiate the what, when, where and how of a project before you commit to it.

Are not looked after like an employee. You need to plan ahead because you are not always entitled to warnings before you are let go. You don’t get sick pay or annual leave.

From the start you need to appreciate that you are running a business, and that the product is you. Consider getting legal and accounting advice about being an “independent contractor”. Should you operate as a “sole trader” or a start a “company”?

A company protects you from personal liability but it will involve more compliance. How should you plan for gaps in your income and what taxes do you pay?

It is wise to save two to three months of income but unless you have savings, you will need to bank that up at the same time as covering your living expenses and operating costs.

Your rates need to include what you were paid as a salary, plus the costs of running your business. You should also add in a profit margin to allow you to grow your skills and reap some benefit from taking the risk of being your own boss. be much easier to find. But if you don’t have the right skills to do that project, be honest. Personally, I get a lot of satisfaction from matchmaking businesses with consultants who have the right skill fit. This also helps me build my professional network and encourages further collaboration.

Growing an independent mindset. You won’t belong to the organisation you are contracting with. They don’t have to invite you to team meetings or involve you in planning. Some fulltime employees may resent you if they think you’re earning more than them. Often the reason you will be hired is because you can give an objective view so being able to maintain that independence is important.

Being adaptable. You will be hired to fill a gap, solve a problem or tackle an urgent job. Show clients you can quickly fit in, get the work done and have the skills to address whatever it is they need. Sometimes this means not being a perfectionist, or asking lots of questions so you can get up to speed fast.

Managing expectations. Clients often judge freelancers more critically than other team members and expect higher standards because they are paying more for them than wages for their staff. This means you need to set KPIs and deadlines in your contracts that you know you can meet, not just what the client demands. Ideally, before you start working together, you and your client will have open discussions about how your relationship will work and what each of you expects from the other. nature of freelancing or consulting involves responsibility, commitment and initiative. You gain confidence and cope with the insecurities of it by sorting the practical details and mastering a long term holistic strategy. Having good contracts in place is essential to dealing to the details and building strong relationships is the key to security. Both will help ensure you have more control over your future but remember that neither Yin nor Yang is absolute. Each aspect is interdependent and contains the beginning point for the other aspect. For example, day becomes night and then night becomes day. You will find a new balance in your life as a freelancer or consultant if you consider both aspects.