100 is the magic number

Ever hired a freelancer? Maybe you hired a designer or a PR guru? Or brought someone in to help you with a particularly knotty HR issue.

And you boggled at the day rate didn’t you?

£200, £500, £1,000 per day? ((not me though, for MY rates you need to get in touch obv.))

And then you did a quick mental calculation and compared that figure to your annual salary.

And then you thought “I’m in the wrong business”.

And then you followed that thought through and took the plunge yourself.

And then you found that you were earning a lot less than you were expected. A lot less than when you were in that job ((working all day for a mean little man with a clip on tie and a rub on tan)).

And then you found yourself here. Hoping that finding out how I failed will make you feel better about yourself.

But it won’t.

Your error was introduced right at the start. When you did that mental arithmetic. Because 100 is the magic number ((obviously three is really the magic number)).

As a rule of thumb even a really successful freelance can’t expect to bill more than 100 days in a year.

Why not?

Well first of all you need to get the work. That all takes time, that web content won’t write itself and business breakfasts are less effective networking events if you don’t attend.

Then when you do get the work it will actually take longer than you said it would ((which is why billing based on days is rubbish see my yet to be written post ‘bill by the hour’)). You can’t bill more so you just have to get on with it.

Then there are administrative things that need to be done. The government requires a tax return for example, the dog needs walking.

And as you start to get busier you get diary clashes. You really want to run that workshop in March but you are already committed, how’s April? May?

And you’ll get no work in August or December.

So you will be doing fabulously well if you bill 100 days in a year.

And 100 days at, say, £400 a day is a decent income ((though obviously it isn’t a salary, lacks sick pay, holiday pay and any certainty it will ever appear again)). It isn’t what you probably thought that consultant was earning though.

If you do want to earn the big bucks try interim-ing or running a proper business ((where you employ people, the secret of making money being that you shouldn’t have to be there while it is being made, though there’s all the stress of managing people, booking leave and generally having to think about others your hatred of which was why you left your job in the first place)). Subjects, sadly, beyond the scope of this blog.

Work for free

I sometimes think that my preferred business model is the one where a kind benefactor gives me enough money to be comfortable, not for a return – just because I’m great. Then I am free to float around the world doing good things of social value ((If you *are* a wealthy benefactor do get in touch, obv.)).

For some people work is actually quite like that. If you have a job which really motivates you, which you think is really worthwhile, which delivers things that you are important then it’s exactly like that ((my job is exactly like this, of course, just in case the boss is reading)). If you are paid a salary, have a contract of employment, paid leave, and even sick leave. This money keeps coming, you can plan, you can get a mortgage. The good things of social value you do are quite disconnected from the money that people send you ((send you)).

Being freelance is NOT like that.

In the world of a freelancer every penny is directly related to the work that you do.

On top of which you have to spend plenty of time not being paid while you convince people to pay you, in the future, for doing some more work for them, which may or may not be of actual value ((see the post on 100 is the magic number which I haven’t actually written yet)). And there is no holiday pay, sick pay, often just no pay.

Accordingly this means that working for free as a freelancer is actually working for negative income. Not only are you not being paid, you are putting off the unpaid work you will need to do in order to get paid in the future.

Working for free as a freelancer sucks.

And yet so many freelancers do it.

They do favours for friends, they do little pieces of work in the hope of getting bigger pieces of work, they blog ((ahem)), they organise events, networking clubs, barcamps, they speak at conferences.

And on each occasion they are not just working for free, they are subsidising someone else. Often from their children’s Christmas present list.

Of course freelancing gives you the freedom and flexibility to do what you want to do ((be what you want to be)). But if a major attraction of the freelance life is to do things of value that no-one will pay you for then you might be better served by getting a different job ((or winning the lottery, see footnote in ”Walking out is awesome and totally a good idea” http://htfaf.com/?p=104)).