FREE SPIRIT: In a new book, Freelancers Union leader Sara Horowitz touches on topics like smart home offices, contracts and more. (
)
For the estimated one-third of American workers who are independent employees, the perks of a solo career are many: There’s the flexible schedule, lack of commute, autonomy over one’s professional trajectory and the ability to go for a bike ride smack in the middle of the day.
“Freelancers are building very different lives than those in the traditional workforce,” says Sara Horowitz, founder of the Brooklyn-based Freelancers Union, whose new book, “The Freelancer’s Bible,” comes out tomorrow. “The value proposition of work has changed for millions of Americans: It’s not just about a pile of money anymore, it’s about something more personal, connected, and flexible.”
But the MacArthur Fellowship-winning Horowitz — who logged time as a frustrated independent contract lawyer before founding the groundbreaking union in 1995 — also knows the path to a successful indie career doesn’t come without its share of unique hurdles.
“I wrote [the book] for the men and women who want the career of their dreams on their terms,” she says of the comprehensive tome, for which she surveyed hundreds of freelancers. “My hope is that it gives them the jump start they need.”
Here, she dishes on the most common challenges freelancers face and how to overcome them in order to join the growing ranks of “solo-preneurs”:
* DON’T GO IT ALONE
Freelance work is defined by its independent nature, but it’s impossible to get a career off the ground without strong support from your friends.
“Your network is really important,” Horowitz says. “It’s how you’re going to manage your freelance life.”
For starters, reach out to your existing social and professional network to “let them know where you want to go,” she says. This will help you cultivate what Horowitz calls your “Brain Trust” — those who can offer solid business advice, connect you with potential clients, help with IT nightmares or simply serve as sounding boards.
Just don’t forget to return the favor: “There’s nothing that fails more immediately than someone who keeps asking and doesn’t give back,” Horowitz says.
* STRATEGIZE AND CATEGORIZE
According to Horowitz, most freelance careers start off with a “ready, fire, aim” mentality. But in order to turn your ace accounting skills or musical prowess into a steady income, first you need business savvy.
She suggests looking at your work as though it were your stock portfolio and diversifying it into four categories: “blue chip” clients who offer steady, well-paying, regular gigs; a slew of other good clients you would like to work with regularly (not all will pan out); short-term one-off gigs, such as a few-day temping stint, that will help you earn a quick buck; and long-term ventures, like writing a book, which could pay off in the future.
By doing this, you put real infrastructure into place that builds up the predictability of your income. “It’s a buffer against either having no work, or having work that pays too little,” Horowitz says.
* SET UP YOUR
OFFICE SMART
If you think working from bed is a staple of freelance life, think again. It’s crucial to set up a dedicated office space — even if it’s just a tiny nook of your studio apartment.
“You really want to spend time getting organized, so you have an efficient workspace,” she says. “And make sure you’re setting things up ergonomically.”
And no, the folding chair at your kitchen table does not an office make: Not only can such a shoddy setup lead to back pain and carpal tunnel syndrome, warns Horowitz, but it fails to qualify for the IRS write-offs for home offices. In order to claim a home office as a business expense, the workspace must be exclusively and regularly used as your principal place of business. In other words, it can’t double as a site for sleeping — or spaghetti dinners.
* PREPARE FOR
DRY SPELLS
One of the biggest challenges of freelance life, Horowitz says, “is the feast or famine nature of it.”
Unlike the steady paycheck and workflow of a traditional office job, freelance work can come all at once — or even not at all. Case in point: According to a 2011 Freelancers Union study, 49 percent of independent workers said they experienced periods of no work in the past year.
To survive that inevitable drought, Horowitz suggests tucking away 40 percent of your income in a savings account and keeping a few future projects in your pipeline — even when you’re at your busiest.
What to do if you find yourself with an empty schedule? Use the free time to try out a cooking class or volunteer at an animal shelter.
“When you do that,” says Horowitz, “you can find the craziest circumstances in life where you get gigs.”
* ESTABLISH A SCHEDULE AND STICK TO IT
“It’s a mistake to think you’re going to work nine to five, and then you’re going to be free in the evening,” says Horowitz of the freelancer schedule. “It’s not going to be the cubicle life of the 40-hour work week.”
Indeed, with the boundaries between business and home dismantled, she says work can be all-encompassing, bleeding into family time, weekends and would-be vacation days.
Horowitz suggests scheduling “free-time blocks” into your day and setting a vacation policy for yourself (such as two weeks during the summer season).
“You do have to have some time off,” she cautions.
The flip-side challenge: honing self-discipline to stick to a daily schedule when you’re working solo. Horowitz suggests determining what time of day you’re most productive, and, through trial and error, “figuring out what your rhythm is.”
Once you’ve nailed down your routine, be sure to give your nearest and dearest the heads-up.
“One difficult thing for freelancers is that their friends and family assume they can go and pick up their dry cleaning or walk their dog, because they’re ‘just freelancing’ and their schedule is completely open,” Horowitz says. “You’ve got to let the people around you know you’re actually working.”
* GET IT IN WRITING
In a 2011 Freelancers Union study, a whopping 44 percent of freelancers claimed they’ve had trouble collecting payment for work they’ve done — with each freelancer being paid an average of $10,071 late.
And with no real legal protections against a freelancer’s missing wages (currently, the only option is small claims court) Horowitz says the best defense is to have a thorough contract in place before you even start a gig.
“It is so unbelievably important that you have clarity,” she says.
If you can’t get a client to sign a contract — like those workers can make with the Freelancers Union’s free online Contract Creator — Horowitz suggests spelling out the terms of your project in an e-mail saying, “I’m assuming that if I don’t hear back from you, this is the agreement.”
Otherwise, she says, “there’s little to no recourse.”
* DON’T GET TRIPPED UP ON TAXES
Tax season can be a headache for everyone, but workers classified as sole proprietors must jump through extra hoops when it’s time to file.
For example, freelancers must pay a self-employment tax, keep careful track of every cent they earn from various clients and — often trickiest of all — meticulously document any potentially deductible business expenses, such as your business phone line and specialized software.
Horowitz’s advice?
“As soon as you can afford it, you should hire an accountant,” she says. “I don’t say that lightly, but the taxes are so crazy that it will pay for itself or save you heartache.”