Nicole Fenton is the coauthor of Nicely Said. They design with words.

In the Wild and In the Black

Less than a year ago, I barely made enough to pay the bills, let alone sleep soundly. After a few months of working as a freelance consultant, I’m obligated to say it isn’t easy, but it is rewarding. Even though my income keeps multiplying, I’m not talking about the money.

Starting a business isn’t rocket science, but there’s a lot of red tape. Things are scary at first. You take on things you didn’t know existed, all in the name of more work. But it’s worth it—it really is. You can do it too. Open to questions as always.

Start at the bottom

Learn your trade. Work for different types of organizations, large and small. Don’t be too picky at first. Stick it out. Wait until you’re bored and making up your own deliverables. If you know what you want, you’ll get there. Experience is what matters.

Talk to other freelancers

Whether you have a friend in iOS development or landscape architecture, it doesn’t matter, really. We all have to know the same basic business laws. Buy your friend a beer or two, or find yourself a mentor.

Don’t quit your day job yet

Leaving the so-called security of a salary and a healthcare plan can be scary. There are options out there, though. I recommend you research them and save up a little cash before putting in your two-week notice.

Charge fairly—for yourself

When you work for yourself, your time is valuable. Don’t work for free. If you help a friend, trade for something else. Depending on your situation, you probably need insurance, internet access, and administrative tools. Include those costs in your rate.

If you work for an agency, they’re most likely charging clients more than double your potential hourly rate. Part of that is to pay for benefits, office rent, legal protections, and snacks. The other part is them banking on you wanting a sense of security and paying for it.

Don’t underbid yourself. Research what other people make hourly. Don’t think your rate is your salary divided by 2080. It isn’t. You have to charge fairly. As they say, freelance is “feast or famine.” One more thing about your rate: don’t apologize for it. If you charge $100 an hour, just say, “I charge $100 an hour.”

Contracts are your friend

Statements of work are important for defining goals and deliverables, but you should get your client to sign your independent contractor agreement. I mean, if you want to get paid.

Put that tax money away, for reals

When you’re ready, get a business bank account. Put your tax withholdings in savings. In California, it works out to be about 30% of whatever you earn.

Read up

Indispensable resources from my colleagues:

Working for Yourself by Attorney Stephen Fishman. Covers everything you need to know about federal taxes, contracts, employment protections, and statements of work. Freelance Switch.com: great site with articles on everything from how to get paid to what the best time tracking program is. It’s Harvest, by the way.

Acknowledgments

I wouldn’t be where I am today if I didn’t know Scott Gilfoil, Colin Barrett, Keri Maijala, Andreas Stavropolous, Chris Grecean, Tracey Thompson, and Tiffani Jones Brown. Thank you.