Going freelance? It's more important than ever to protect your income

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12 February 2019

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An increasing number of Australians are ditching the nine-to-five, Monday-to-Friday employment routine and deciding that a freelance career is a much more attractive way to go.

And you can understand why. You decide the hours, and you choose what you work on. No more being told what to do and when to do it - you can work where you want, when you want.

Of course, technology has made the option of freelancing viable for more people in more professions than ever before. No longer is it the sole domain of mercenary soldiers – the original freelancers of the middle ages who offered their services to any army who needed and paid them.

The rise of online freelance job platforms has undoubtedly helped. Businesses too are becoming accustomed, and open, to calling in expert, freelance help.

In 2017 for the first time, members of the Australian workforce with permanent, full-time jobs were in the minority, 49.97% down from 51.35% in 20121, while 4.1m people in Australia freelanced in 20152 - the majority (57%) starting out of choice.

While being a freelancer undoubtedly has its perks, it comes with unique challenges that you need to be prepared for. 

Managing the flexibility

The freedom of freelance life is a big draw. And of course, that flexibility is great providing you manage yourself and your time well. Because in reality, the flip side of being able to go to the movies on a Wednesday afternoon is needing to work into the small hours of Wednesday night.

Being your own boss is a 24/7 juggle of working on the business and in the business. You need to keep the jobs coming in so networking and marketing, as well as getting the paid work done, are absolute musts.

Working by yourself can be a challenge, too. If you’re not in an office you may miss the support network and camaraderie being part of a good team provides. Co-working spaces can offer a great alternative.

Managing the finances

The prospect of earning more money is another motivator for many taking the freelance leap.

What you sacrifice for flexibility and increased earning potential is a regular income paid to your bank account.

Working freelance, you’ll face the challenges of figuring out your billable versus non-billable hours, invoicing, irregular income and slow payers (or, even worse, non-payers), so make sure you have enough cash in the bank to see you through the financial dry spells. Cash flow is one of the biggest issues you’ll encounter.

When deciding what to charge clients remember to factor in superannuation contributions, tax, holiday and sick pay, too. All the things your employer took care of you now need to look after.

Getting the right support

Of course, if you are injured or ill and unable to work you’ll have no team to fall back on, and no sick leave to cover some recuperation time. So, get a backup plan with a freelancer in the same profession to look after the day-to-day work if either of you is ill. You can’t let clients down – if you do, chances are they won’t return in a hurry. 

Your financial situation, while potentially more lucrative, is by its nature more precarious. And if you or your family relies on your income you need to make sure you have a safety net in place.

Speak to a financial adviser to check that your life insurance policy is tailored for self-employment, and your income protection insurance covers both your new earning potential and your new working arrangements.

Once that’s sorted, you can enjoy your Wednesday matinee and ice cream with your mind firmly at ease. (And one eye on your emails.)


  1. https://d3n8a8pro7vhmx.cloudfront.net/theausinstitute/pages/2807/attachments/original/1528337971/Insecure_Work_Factbook.pdf
  2. http://www.cxcglobal.com.au/freelancing-in-australia/


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