There are dozens of benefits to working for yourself: You set your own hours; you save time on your commute; you wear whatever clothes you want, etc. However, there is a well-known downside to being self-employed: low cash flow.
Because many self-employed women rely on an invoicing process, there tends to be a delay between when work is completed and when you receive payments owed. At least initially, many self-employed workers struggle to make ends meet. Worse, as the Wall Street Journal explains, working for yourself can be more expensive than finding traditional employment, as self-employed workers must pay for their own payroll taxes, health insurance, retirement savings, and more.
As roughly 7 percent of women can attest, successful self-employment is possible. However, this particular hustle requires confidence and diligence ― which you might achieve with the following tips.
Be Strict With Your Schedule
One of the most fantastic benefits of being self-employed is schedule flexibility, but you might not realize how much you rely on your employer’s work schedule until you are tasked with creating your own from scratch. Often, newly self-employed women respond to their free schedules in one of two ways: Either they work nonstop, or they forget to work at all.
Because you are solely responsible for your own income, you must have regular working hours. There is a reason most workplaces enforce a nine-to-five schedule ― it works ― but you can rearrange your days however you like as long as you have an extended period when you get work done. Only very rarely should you allow yourself to deviate from your schedule; if you make a habit of starting late or quitting early, you might find your bank account emptier than you expected.
Be Smart With Your Savings
At first, self-employment feels incredibly powerful ― and profitable. Because you are receiving the sum-total of profits for your work efforts, you might be tempted to believe that you are getting rich and overspend. Unfortunately, as a self-employed worker, you can’t devote all your income to shoes and ice cream; to sustain your profitability, you need to earmark a significant portion of your money for financial stability.
Self-employment provides less-reliable income than typical employment, so it is wise to be as financially stingy as possible. Before you spend a single dime, you should make a comprehensive budget that includes your living expenses, your annual taxes, responsible savings goals, and any funding you need for your work. If you are managing your money well, the periods of low income won’t be as punishing, and you will actually see the success accumulate in your savings accounts.
Be Precise With Your Payments
What your clients pay, you receive, which means it is of incredible importance that your clients understand your payment process. Invoicing is among the most common ways for self-employed workers to collect cash, and the vast majority of your potential clients are familiar and comfortable with the invoicing process. Still, you should follow unspoken invoicing rules, like being transparent with your payment terms and being descriptive with your invoiced charges.
Even when you are precise, you will inevitably have a few clients who take a long time to get around to paying. Unfortunately you don’t always have the luxury of waiting while lagging clients make their payments. In cases where money is needed without delay, many use invoice financing to sell their invoice to a third party that pays them a percentage of the invoice, minus fees, and then the rest once the client pays up.
Be Careful With Your Knowledge
No matter how you are employed, you generate personal income with one particular product: your knowledge. Doctors sell their medical expertise, farmers sell their proficiency with crops and livestock, and you sell whatever it is you know enough about to make money. For the self-employed, knowledge is an especially precious commodity, which means you must be extremely careful how you use it.
Self-employed women often suffer the challenge of loved ones asking for free services, but by giving away your expertise without payment, you are devaluing the work you do. You must respect your job enough to require compensation, no matter who asks for your help.
Be Committed to Your Dream
Finally, you have embarked on the journey of self-employment for a reason, and to find success, you must be committed to this career path. You might not see substantial profits for a few months (or even a few years) after you start, so self-employment is definitely not a job for those in-between jobs. However, if you know what you want to achieve with your self-employment, you can do amazing things, and you can see success.