3 Things I Wished I Considered When I Started as a Freelancer
In March 2014, I was a recent law school graduate impatiently waiting for my results from the New York bar exam. I needed to make money and gain legal skills so I worked as a Paralegal. I hated it. I loved doing legal research and writing but I hated (and sucked) at the secretarial duties that came along with being a paralegal. Within three months I quit and started freelancing my research and writing skills to law firms who needed a blog or newsletter. At the time I just saw myself as person doing work I liked for money and at the same time having freedom. Little did I know I was taking the first few steps toward entrepreneurship. Here, are 3 Things I Wished I Considered When I Started as a Freelancer.
Before I started my freelance business I generally worked for other people. At the beginning of starting any job I would complete my IRS W4 form and provided other documents and then my taxes would automatically be taken out of my account like magic. The same was not true when I started my business. I was now a 1099 earner which meant I was responsible for paying taxes on all the income that was coming in to my business. This sounds simple but it really isn’t because you generally have to figure out what you owe to federal, state, and perhaps city, pay taxes quarterly, and obtaining a EIN. Looking back now I should of considered sitting down with a accounting professional or attending a business tax seminar just to get a overall view on what to expect especially when I started making a profit.
2. Forming a LLC
Again, I never considered myself a business. I was just someone providing a service for money. Which sounds so stupid now because that’s a basic principle in a business. I never took into consideration forming a LLC. A LLC is a limited liability corporation that gives you the ability to have your profits only get taxed once instead of twice like a traditional corporation but gives you protection as a person from your business. This may seem boring but it is a great protection. Thankfully I never had a contractual disagreement with a client but if I ever did I would of been open to lawsuit that would have impacted my personal finances (I mean I had nothing but student loan debt but still…). A LLC means generally any judgments again the business will only impact the business and not the individual. Forming a LLC is fairly inexpensive if done correctly but can be expensive if done incorrectly.
3. Domain Name
I never thought about a web presence at all when I started out which looking back I can’t believe it myself. I had a personal Facebook page, instagram, twitter, and whatever but I didn’t consider having a web presence until a lawyer asked me for a website. Again, I was broke so I really didn’t think I had the money for a website (looking back I did, I just had to learn to build my own website) and started a Facebook business page. But even if I didn’t think I had the money for a website I still should have considered purchasing a domain name. A domain name can be as little as 99 cents for the first year. If you wait to purchase a domain name until you can make a website you put yourself at risk of someone buying the name you want. This may seem like nothing but if you built a brand using one name you don’t want to confuse customers by using a domain name that isn’t on brand. A domain name can be less than $5 a year. Just buy it.
Back in 2014 I was scared about going out on my own but I’m glad I did. It taught me how to be independent, provide a great service, and conduct business. It’s been a awesome experience but I did stumble along the way and if you’re starting you too will stumble which is OK. These are 3 things I wish I considered when I was starting out as a freelancer. If you are a freelancer and have a few things you would like to add to this uncompleted list please comment below.