Working as a freelancer can provide you with numerous benefits such as the freedom to work where you want and with whom. But how do you get started as a freelancer? This article/freelancer guide will help answer that question for you!
- Why become a freelancer?
- Independence and flexibility
- Professional and personal development
- Financial opportunities
- Current labour market trends
- How can I become a freelancer?
- Self-reflection – what do I want and what can I do?
- The unique selling proposition – your freelancer DNA
- Networking and creating contracts
- Freelancer guide
Why become a freelancer?
The reasons for becoming self-employed are as varied and individual as the experiences of freelancers. Often, but not always, there is personal dissatisfaction behind the decision to leave permanent employment and take up freelance work. This could be because of:
- Low demand or restrictions in the permanent position
- The desire for new challenges
- A longing for freedom of choice and responsibility
- A random business idea
- The desire for more flexibility and a better work-life balance
Independence and flexibility
The advantages of freelancing are obvious: successful freelancers are completely free and can decide for themselves which job to take, where, with whom and when to work. In fact, it is the independence, the desire to be one’s own boss and to decide for oneself that is the deciding factor in quitting one’s job and embarking into freelancing.
But freelancers are more flexible not only in deciding what to do, but also in deciding how to do it. People who decide to pursue a career as a freelancer often have precisely this aspiration: freedom and self-determination.
The much-appreciated flexibility also brings other advantages. Depending on the job, freelancers can decide not only where they want to work – in a home office, in a café, in a co-working space – but also when. In addition to local independence, you have a certain amount of freedom in choosing your project partners and can (or must) say “no” to unsuitable projects.
The desire for independence is usually closely linked to the desire for self-realisation. “Doing your own thing”, taking full responsibility, taking risks and seizing opportunities. But also: finally doing what you really like, what you can identify with and what you stand behind 100%.
Or it can also be the desire to take the initiative and implement something. What is often propagated as being welcomed in a company is not quite as popular in reality. – the deadlines are too tight, the processes too bogged down. But it is human nature to want to realise oneself. As a freelancer or self-employed, this need is automatically fulfilled.
Professional and personal development
Knowledge is power, as we all know, and expert knowledge is akin to having superpowers in the labour market. However, this expert status does not simply remain for life. Much more, freelancers are required to constantly educate themselves in order to stay up to date and thus stay one step ahead of their competitors.
In addition, frequent changes in the environment are part of the job: changing business partners, conditions, work locations and activities – you have to be agile and remain flexible. This leads not only to professional growth, but also to personal growth.
In addition to all the emotional reasons that speak for starting a career in freelancing, there is also a very rational aspect: depending on the industry and conditions, the earning opportunities for freelancers are decisively better than in a more permanent role.
Studies confirm this: according to the Freelancer Survey 2021, 59% of freelancers say they earn more than their colleagues in a permanent position. In the IT sector especially, freelancers have a very good chance of earning an above-average salary. To make freelancing really worthwhile financially, it is important that the freelancer knows his or her worth.
Current labour market trends
It is not only personal factors or good earning opportunities that speak for a career as a freelance expert – general labour market trends also favour a future in freelancing. Alternative working time models and a broader understanding of work-life balance as well as new workplace requirements are playing an increasingly important role for employees and employers.
This makes it more difficult to fill jobs quickly and effectively. This is where “outsiders” often come into play. With their know-how and often greater flexibility, freelancers are able to fill such gaps quickly and competently.
The shortage of skilled workers, which everyone is talking about at the moment, also benefits freelancers. As well-trained, specialised professionals who are quickly and flexibly available for projects and clients, freelancers are growing to be favourites amongst recruiters.
How can I become a freelancer?
Does stepping into self-employment sound tempting? Then let’s go for it! But before you dive headfirst into the freelance adventure, it’s important to take your time and consider a few steps.
Self-reflection – what do I want and what can I do?
If you want to take off on your own, you need to know what you can do. Are you an online marketing specialist, SCRUM master or PHP programmer? Do you have little to no professional experience? Write down all the other skills and knowledge you have gathered so far.
Anyone can become a freelancer. Not only do academic achievements count, experience, special knowledge, and passion also play an important role.
Next, think about which market you can work in and what kind of clients you are looking for. It is important to know what your potential clients want so that you can present your expertise accordingly.
The unique selling proposition- your freelancer DNA
Once you have a detailed picture of your knowledge, skills and expertise and know what clients are looking for in your market, define your unique selling proposition. Ask yourself:
- What can you do better than anyone else?
- What sets you apart from the other competitors so much that the client should hire you for the project?
- What does your perfect client look like?
In doing so, don’t just define a specialism or expertise that makes you stand out, but rather a set of skills that makes you special: this is your own freelancer DNA. The more precisely you define these, the more precisely you can solve the problems of your potential clients.
Self-marketing – your business card
Once you have defined yourself as a freelancer and identified potential markets and clients, it’s time to market yourself. In addition to active marketing “in real life”, i.e. offline, it is just as important in today’s world to be convincing online. Build your own business card mix from the many digital possibilities: for example, with a job network profile, your own website or your own social media page.
Join our IT freelancer community today! Create your freelance profile in just 2 minutes.
Quality instead of quantity: It is not necessarily important to have as many profiles as possible, but to have well-maintained profiles. The more accurately you describe yourself and your work, the more directly you will approach suitable clients. Make it as easy as possible for your potential clients to reach you. Position your contact details or at least an e-mail address as prominently as possible.
It also helps to look at your competitors – for example, on freelancer platforms such as freelancermap – to get a feel for how to market yourself. But remember: getting inspired is allowed, not copying!
💡 Not sure on how to market yourself properly? Read our article on self-marketing tips for freelancers.
Networking and creating contacts – your first job
Once you have created your digital business cards, the next step is to recommend yourself to potential clients. It is important to make contacts online and offline, to other freelancers but also to companies and recruiters, and to market your self-employment. For example, get yourself talked about in topic-related social media groups or report on your offer in blogs. The more people become aware of you, the higher the chance of gaining new clients and landing your first job.
FYI: You don’t have to freelance full-time right from the start. You can also start as a part-time freelancer to see if your concept works.
Freelancer guide: Become a freelancer in 10 steps
There are countless ways to become self-employed and follow your true calling. However, there are many stumbling blocks along the way that can make it difficult to become a freelancer. With good planning, however, the step into self-employment can be relatively easy. Our freelancer guide will help you plan out your move and put you on your way to becoming a successful freelancer.
The very first thing you need to think about, according to our freelancer guide, is what you want to offer. To do this, the following points need to be clarified:
- What am I particularly good at?
- What makes me stand out from the competition?
- In which market am I sought after?
In order to make the proposal as attractive as possible, it is also helpful to think about what the ideal customer looks like. What problem does he or she have? You can elaborate on your offer until it becomes the perfect solution to the customer’s problem.
#2 Market analysis
The next step in the freelancer guide is to find and analyse the market for the previously defined offer. For this, potential customers – the target group – the already existing offer and the competitors have to be examined. Five questions need to be focused on here:
- How big is my target group?
- Who are my competitors?
- How big is the market potential?
- What trends are emerging?
- How attractive is my market?
To answer all these questions, good research is necessary. But you should definitely do the work, because: well-planned is half-realised. A properly prepared business plan helps to answer the most important questions about starting your own business. Of course, you don’t have to make up your own business plan. There are countless templates on the Internet.
#3 Financial planning
If you have not already worked through this step in the preparation of your business plan, you should deal with it as soon as you can. The simple economic principle also applies to freelancers:
income – expenses = profit
For freelancers, profit means the income from which they live. The following questions should therefore be clarified for sound financial planning:
- What is my hourly rate?
- How many days can I work productively?
- What costs will I incur?
- How much profit do I need to make to finance my lifestyle?
These calculations can be made for different time periods. Annual planning is recommended in all cases – but those starting out as fresh freelancers may feel more confident with monthly planning.
Calculate your hourly rate now with our guide: How to set your rates as a freelancer.
Future freelancers should also be aware of insurance contributions, costs for workplace equipment and expenses, as well as taxes. It is also advisable to consider which type of taxation should be chosen when registering. Depending on your income, the small business regulation may be worthwhile here.
#4 Legal form
Once you have a clear idea of what you want to offer and where, the next question you need to ask yourself is: What legal form should I choose? The following legal forms are particularly suitable for 1-person enterprises:
- Sole proprietorship with unlimited liability (freelancer, small business)
- Sole proprietorship with limited liability (GmbH, UG)
- Civil law partnership (GbR)
- Partnership company (PartG)
There are advantages and disadvantages to each legal form. Which one is best suited to the future depends on the business idea, the goals set, the scope of activity or the start-up capital.
This may be perhaps the most important step in this freelancer guide. What sounds like a lot of bureaucracy and formalities is actually not a lot of effort. If you want to register your freelance activity, you can do this quite simply. Please note that every country has specific regulations so to register, you will need to check with your local tax office.
They will inform you about all the necessary documents and any necessary permits you’ll need.
For freelancers to be able to work, they need a workplace that is tailored to their work. Depending on the needs and requirements, this can be at home in a home office, at a client’s company, in a co-working space or at any conceivable location from which the work can be done.
However, it is important that the work equipment is reliable and representative. Poor telephone connections or slow internet do not make a professional impression, nor is it possible to work efficiently with them. Create the best conditions to be productive and to make the (collaborative) work as pleasant as possible for you and your clients. The following should be considered:
- Where do I want to work?
- What premises do I need for this?
- How can I be reached (do I need a new business number)?
- What kind of internet connection do I need?
- Do I need new equipment such as a mobile phone or laptop?
For freelancers that are just starting out, work equipment can be a major cost. Be aware of this and include the costs early and in detail in your financial planning.
#7 Promote your business
After the planning and registration have been completed, the next step, according to our freelancer guide, is to promote your own business. With the many possibilities offered by the Internet, it is relatively easy to create a professional online presence on various channels. These online marketing measures are particularly suitable for freelancers:
- Own website
- Business profile on social media
- Profile on a freelancer platform
- Profile on online business networks such as LinkedIn
In order to separate professional and private communication, it is advisable to set up a business email address. In combination with a well-maintained website or an appealing and detailed company profile on a social network, a business email address will help you look professional.
In addition to the personal online presence, it can also help to register on suitable freelancer platforms in order to present the offer directly to the right target groups. As with all marketing measures, the more concrete your offer is, the higher the chance of receiving an order.
#8 Insurance and retirement plan
If you become self-employed, you are no longer covered by your employer’s social security and must therefore insure yourself. However, not only are health and accident insurance important for freelancers, it is also advisable to take out property and liability insurance and to think about old-age provision. The following insurances are particularly important:
- Professional liability insurance
- General liability insurance
- Home and Contents insurance
- Health insurance
- Life insurance
#9 First contract
So far so good: your own business has been defined, the advertising has already borne fruit and the first order has fluttered into your inbox. One question that fresh freelancers often ask themselves at this point: Should I actually state the calculated hourly rate? At first glance, the figure may seem huge and a little daunting.
But it is not for nothing that so much has been planned and calculated. Trust your calculations and don’t sell yourself short. It often helps to remind yourself of what is included in the calculated hourly rate.
The last step in the freelancer guide is to invoice the work that has been done for your client. What sounds so simple has some pitfalls that you should be aware of as an invoicing party. The mandatory information on an invoice includes:
- Name and address of the invoicing party – that’s you
- Name and address of the invoice’s recipient – that’s your client
- Customer number and invoice number
- Date of invoice
- The word INVOICE as the title
- Description of the services/product delivered
- Total price before taxes
- Value added tax/discounts – if applicable
- Total amount due
- Specification of the payment terms
- Payment information
- Optional: A personal note
It is important to be very precise with this information, because mistakes can have devastating consequences. Late payments and incorrect amounts are the least of it. If a customer receives an incorrect invoice, they do not have to pay it by law.
Take a look at our free templates, where you will find correctly prepared invoices and other documents to download as PDF, Word or Open Office files.
We hope this freelancer guide helps! How has your freelancing journey been so far? Share with us in the comments below!