The workforce is changing rapidly and more people are going freelance or starting their own business. Quoting a study from 2014 by Freelancers Union, 53 million Americans are currently freelancing; that’s 34% of the entire workforce.
It’s been estimated that this number will rise to 50% by 2020, and that’s only the United States. And according to this study, things aren’t looking that much different in Europe.
It’s safe to say that the future is freelance. The idea of being your own boss, being in control of your own hours and projects, working from home (or bed) or anywhere in the world is appealing to many. Going freelance sounds like a dream full of freedom and possibilities. And while that is perfectly true in some cases, things aren’t as simple as they seem.
Freelance isn’t necessarily “better” than full time. They’re two completely different things and it depends on you to decide what is better. While going freelance can certainly give you some freedom, you also have to deal with taxes, late payments, client acquisition and working by yourself.
So to help you decide what's best for you - let's evaluate the pros and cons of each lifestyle:
Working full time for a company, your hours are fixed to the weekly, day-to-day structure. You show up at work everyday, and you get a paycheck every month. You have to plan your holidays and ask for permission to take time off for major life events.
There is less flexibility and freedom in your life, but more stability and comfort. You have time for your social life after work and you pretty much own your weekends.
Obviously, all things mentioned above are assuming the norm of a regular 9 to 5 job. There are always exceptions.
As a freelancer you have more freedom in deciding when and where you want to work. But don’t think that the life of a freelancer is always more flexible and free. You have to be a good time-manager to enjoy the flexibility that the freelance lifestyle can give you. Although even then you may end up canceling evening and weekend plans, because of a last-minute client request or a deadline that crept up. As a freelancer you are on call 24/7.
Most freelancers I know work almost around the clock. It doesn’t have to be that way, but working freelance and being a good manager of your own time are two completely different things and very few people have mastered it.
Assuming you are a fantastic time manager, the freelance lifestyle can definitely give you more freedom and flexibility.
One little side note: Lots of freelancers are usually hired as if they’re the fire department. Knowing this is important, because it means you’re much more likely to be put on “burning” projects than anyone else. This only means you need to manage your time and expectations even better.
As a full-time employee of a company, your career path is normally very structured. In the creative industry you start as an intern, get hired as a junior, after a few years you will become a mid-weight, senior and eventually a director or partner. You work your way up title- and salary-wise. Your motivation is tested by performance reviews, being on time, delivering the right work and keeping your boss happy.
If your motivation or performance suffers, someone will most likely tell you pretty quickly. Unless you’re working in some sort of leadership role, there is always someone who will watch after you, mentor you, manage you and make sure you keep delivering good work.
When you work as a freelancer, you have to motivate yourself. There has to be a reason for you to get out of bed in the morning, other than an angry boss waiting for you. You have to motivate yourself to attract new clients, push the work you want to do, negotiate budgets and handle your taxes. If you don’t show up every day, there won’t be anyone to tell you off – except for maybe your bank account, which in itself is a good motivator.
Being freelance means that you are your own boss and mentor. No one else will track your hours, your performance or give you meaningful critique on your work. You have to seek it.
Working at a company gives you peace of mind when it comes to your finances. You are working for a salary that comes in every month or even every two weeks if you work in the US. You can plan your budget, save up regularly and even pension is taken care of in most cases. If you overspend a little on a holiday, you know exactly when and what amount will come in by the end of the month.
Overall, you don’t need to think much about finances. You know exactly what you’re getting and all you care about is your next raise.
As a freelancer, your finances will fluctuate pretty often. You can go from being very broke and waiting for three invoices to get paid, to living comfortably for a few months when those invoices are eventually paid. It is very important you put aside money and build a financial buffer. You can’t always rely on promises made by clients.
Being freelance means that you’re fully responsible for your own finances. You’re the one who needs to run after clients and make sure you get paid on time. This is one of the biggest aspects of being a freelancer, next to managing your time and motivating yourself.
Also when it comes to pensions, insurance and taxes, it is up to you to take care of this.
We spend most of our time at work and having a good company culture is very important. When you have colleagues that you like, your work place can become a big part of your social life. Most companies organise outings, social events, group lunches and Friday drinks.
On the downside, if you don’t have a good relationship with your colleagues, or if there is a toxic work environment, it can really drag you down and you can feel stuck.
But assuming the company culture is positive, being part of a community is one of the biggest benefits of working full time.
Most freelancers start working from home and this can be a very lonely job. You only communicate with your clients, and sometimes there are days where you will be locked behind your screen to work on a deadline. Some freelancers end up finding a co-working space, so you can collaborate or get feedback from other fellow freelancers.
In general, being a freelance designer is a lonely job unless you put in a big effort to change that. You have to put yourself out there, go to events or surround yourself with like minded people at a co-working space.
Being freelance is perfect for us introverts, but being freelance for a couple years just by yourself can definitely take a toll on you.
At most companies you will be provided with the best utilities and tools to do your job. Some companies want to be up to date with all the latest gadgets, techniques and programs. You can enjoy events, lectures, take relevant workshops or get the latest software and hardware updates via your company. To be able to attend events during working hours is a big benefit of working for a company. You will still get paid.
As a freelancer your personal and work life are a bit more blurred. This can sometimes be a benefit when it comes to taxes. Exhibitions, books, flights, travel, hardware and software can all be deducted from your income. On the other hand, the bigger expenses are also for you to pay. Laptops, cameras and other hardware will be of your own expense. Also, if you need to do a course or workshop, it will cost you double because you need to take time off from client work and pay for the workshop itself.
This is probably the biggest advantage of working full time. Depending on your country benefits can be: health-care, paid vacations, paid sick days, maternity leave, pension, legal protection, workers rights, etc. You are protected by a contract, and through law and regulations.
As a freelancer you are again, on your own. You have to plan for retirement, save up for tax payments, plan holidays in between contracts, and most importantly, not get sick! Building that financial buffer is important if you are thinking about going freelance, because it can protect you from all the things mentioned above.
Unless you create these benefits for yourself, they do not exist in the land of freelance.
We are lucky to be in an industry that makes switching between full time, contracting and freelancing fairly easy. If you’re deciding between full time and freelance, think of it more as a lifestyle choice rather than a career choice.
There are plenty of opportunities and many ways of working. There isn’t one better than the other. Find what makes you happiest, fulfilled and matches your current lifestyle.
For me, more freedom was the biggest motivator to go freelance. There have been two companies I’ve considered working full time for in the last four years, but still – the feeling of being in control of my own life was stronger. I’m not saying I will never go back to working full time, but for now, I’m a happy freelancer.
Ultimately it will come down to how risk-averse you are in your personal life, and the good thing is that you can easily switch between one and the other.