My So-Called Freelance Life - Michelle Goodman [65]
Ebbs Are for Amateurs
Lots of advice targeted at new freelancers drones on about the feast-or-famine cycles of the independent professional’s workload and all its maddening financial ebbs and flows. While it’s true your workload (and thus, income) may vacillate between drizzle and shitstorm your first year or two, you should be working your heinie off to make those erratic ebbs and flows a distant memory as soon as humanly possible.
If you have a domestic partner or relative who’s agreed to float you financially for a year while you get your freelance business off the ground, wonderful for you. However, thousands upon thousands of single freelancers bootstrap their businesses all by their lonesome year after year, yours truly included. So for the sake of argument, let’s assume the only benefactor you have is you. In fact, even if you live in a two-income household, I suggest you pretend you don’t. Fear of defaulting on your bills is an incredible motivator for drumming up clients in record time. Knowing your partner will pick up the pieces isn’t.
Likewise, having a thousand dollars’ worth of crap you can sell on eBay in a pinch will only get you so far. A better way to stabilize your cash flow is to build relationships with repeat customers who feed you a steady stream of work each month and pay swiftly. (For a refresher on drumming up clients, see Chapters 7 and 8.) That way, you greatly reduce your chances of falling into that old “Help, no one has paid me in six weeks and the rent is due!” trap we freelancers are so notorious for.
As you’ve seen in the past few chapters, despite the best-laid plans, projects can go horribly awry and freelance checks can go missing. That’s why you need money in the bank, at least three to four months’ living expenses, preferably six. (Personally, I start hyperventilating when my stash dips below the four-month mark.) I mentioned this in Chapter 2, but it bears repeating: Before you leave the 9-to-5 grind, stockpile as much coin as you can. If you’ve already made the leap to full-time freelancing and don’t have much in the way of savings, cozy up to some of those less interesting, higher paying bread-and-butter gigs until you do.
Another way to combat the dreaded cash trickle is to stop spending the check before it arrives. “I don’t think anything’s real until the check is signed and cashed,” says Stephanie Rabinowitz, a New York screen-writer and playwright who doubles as a publicist. “Ray Romano’s production company can say they love my TV pilot, but until they give you money it doesn’t count.”
Once the check does come, an ongoing “don’t access, don’t spend” policy is a must. “I have a savings account with my regular bank, but it’s too accessible,” says business reporter Jane Hodges. “But if you shove your money into an account with an online bank like ING DIRECT, it takes a week to get it. I do this to control myself.”
If your work is seasonal, become an income-rationing ninja (paging anyone who’s ever tried to live off a book advance). Alisa Geller, who’s worked as a freelance fitness trainer in Denver for fifteen years, sees a 50 percent dip in her client sessions each summer because, as she says, “Everyone is running and biking and Rollerblading outside. Lifting is just not their priority.” But that’s not to say she has trouble making ends meet during the warmer months. “I’ve never had problems paying my bills ever,” she says. “The key is to just save as much money as you can in the winter. You take money from anyone, anytime, anywhere.”
Because I’m foreclosure-averse, I like to take things one step further: I keep my favorite contract agency’s number on speed dial in case every last client of mine goes belly-up and I need a three-month permalance gig to bail me out. While my freelance Armageddon fantasy isn’t too likely, knowing I’m employable elsewhere helps me sleep at night.
Retire in Style
Contrary to popular