Earn Money Freelancing While You Build Your Online Business

woman working to earn money freelancing

One of the main reasons that people want to reinvent their lives is because they are unhappy with their work. They might dislike their boss. Perhaps they feel undervalued. Maybe it was only ever a temporary line of work until something better came along.

I find that many people find their whole life comes together with a change in their work environment. Of course, there are many ways you can do this. You may merely need the self-confidence to go job seeking again. A common option nowadays, though, is for people to become their own boss. You could seriously consider setting up an online business.

But it can take time to set up the perfect business – online or in the physical world. It can even take some time to find the ideal job if you want to remain a waged or salaried worker. You have to survive in the interim period. Freelancing can be an excellent way for you to earn money while you are setting up your business or looking for the perfect job.

You may hear all of the stories about people being paid pitiful amounts while freelancing. I have seen writing gigs where unscrupulous businesses have offered freelancers $1 per post. But don’t think all freelancing jobs are like that. Many people claim six-figure incomes from freelancing. I haven’t quite managed to get that high, yet, but I have had many weeks where I have earned more than $1,500 from my freelance activities. If you work hard and market yourself, there is no reason why you shouldn’t be successful.

Freelancing Rates Vary Immensely

One of the most vital things you need to remember when you become involved in freelancing – online freelancing at least – is that you are entering the world market. This means that you are competing with workers around the globe for positions potentially anywhere.

There are a few implications about which you need to think.

Firstly, some countries have a much cheaper lifestyle than others. You will quickly find that many of the pay rates that appear ridiculously low, deliberately target people in low-income countries. So, while you may be horrified by a $5 writing job, a Filipino may find that pay rate is perfectly acceptable because his living costs are so low.

On the other hand, you may come across jobs paying more than $100 per hour. These will usually be from firms in Western countries, who would expect to pay a similar figure in their homeland. Of course, they require as good a quality job performed by a freelancer as they would from somebody in their home nation.

One of the limiting facts when it comes to online freelancing is your language ability. Many of the jobs you encounter will be from people who expect you to use perfect English. If that is your natural language, then you have a natural advantage. You might expect the firm to pay you more than somebody for whom Engish is a second language. Still, you presumably can produce better work, particularly in a field like writing that depends on excellent language skills.

There is a considerable amount of money you can make from freelancing – but you need to do things correctly. Leave the $1 jobs for the people in low-income countries, or the people who don’t know what they are doing.

You Can Even Outsource Your Freelancing

Once you become used to freelancing, there is an additional option available to you. You can set up an agency as the Project Manager on the team. You run a group of freelancers, spending your time searching for suitable gigs to give your team each week. They would do the actual freelance work. You ensure that they perform the tasks.

I did this on a small scale about three years ago. I suddenly had too much writing work. At the same time, I had a friend in South Africa who was a perfectly capable writer (despite English being his second language after Africaans). Among my gigs was one where I had to profile a new startup every week. So, I decided to sub-contract this gig to my friend. He wrote the article each week. I edited it, ensuring that it was as good as if I had written it, and then I worked with the client. I feel that it worked very well for everybody involved.

You Need to Begin By Setting Up a Freelancing Account

Upwork makes an excellent place to start your freelancing career. You probably won’t want to rely on Upwork for all of your clients, but it is a good place for you to learn how to freelance. It is also an excellent platform for you to begin creating an online reputation.

I have written previously about how to set up an Upwork account. I followed that up with Setting up and Perfecting Your Upwork Profile, and How to Grab Your First Upwork Gig.

Take my word for it. The hardest part of your entire freelancing career is the period that elapses between you setting up your Upwork account and having somebody accept your bid for your first gig. I was lucky. I had a firm accept my bid in the first week. Most people I know found it took longer to manage that tricky first gig.

One additional point to consider when setting up your account. Make sure you select a suitable username. The people you hope to work with see that name, and you will be stuck with the name for the rest of the time you remain on Upwork. It is also a good idea to avoid using a job type in your user name. You might want to change to a different kind of job later, but you will still be using the original username.

Don’t Forget to Fill in Your Payment Details

The whole aim of becoming a freelancer is to earn money. Therefore you need to ensure that you have set up easy ways that potential contractors can pay you (via the Upwork platform). Because I am not an American, I do have fewer options here. For a long time, the only way that Upwork could pay me was via PayPal – which meant I lost about 3% of my pay to PayPal fees. Upwork set up a better system a while back where they could pay me directly. It takes a little longer than PayPal to clear, but it means I don’t lose as much in fees.

Look at the options available in your county and pick the one with the least fees, that clears relatively quickly.

Create Your Profile

Although I have already written a post about filling in your profile, I will summarise the key points here.

Every potential contractor will look at your profile. It is your online face. I can’t stress enough how important it is that you set it up correctly.

Obviously, you will need to fill in all the essential details about yourself, including relevant facts about your past.

You will want to be targeting particular types of jobs, however. So you will want to write your profile in such a way that it emphasises your skills in the job sectors you intend to target.

As a writer, I emphasise my writing skills and past writing experience. I make doubly sure that my profile is written in perfect Engish and doesn’t have any glaring typos.

If I were a designer, my profile would focus on my design experience.

One way to do this is to browse for suitable jobs before you even write your profile. Your aim isn’t to apply for gigs yet. What you are looking for is the wording that potential contractors use in their ads. What are they looking for? Use those words to describe yourself. Browsing the jobs on offer may also jog your memory and give you additional ideas of skills that you can offer potential customers.

At the same time, it could be worth taking a close inspection of some of those low paying jobs. These can give you an idea of the skills you should perhaps deemphasise. You’re not going to be doing low paid entry work, so you should avoid focusing on requirements for this kind of work.

You need your profile to emphasise that you can offer more than all of those low-paid people provide. You need a point of difference.

You will need a good quality photograph on your profile. This should be professional looking. Dress as you would if you were applying for a job in a personal interview. Ideally, you should upload a head and shoulders image, but don’t make it look like a passport photo, as that is what many of your low-rate competitors will use.

Setting Your Rate

Set a realistic hourly rate. Remember that Upwork keeps 20% of your pay at the beginning (as you work more for one contractor, you get to keep more of the fee). Your rate can’t be too high at the beginning – remember that first gig is the hardest to find. But you don’t want to appear to be undercharging either.

Depending on your field, I would consider setting your suggested rate at close to your country’s minimum wage. For instance, I initially charged $15 per hour. However, once you have successfully completed a few jobs, you can start to raise your rate towards a more realistic level for your abilities.

Of course, if this will be your only income for a while, you need to ensure that you charge enough to survive. Remember that as a contractor, you don’t qualify for any sick pay or health benefits, and you don’t get holiday pay. You will also be responsible for your tax, too.

When I started my freelancing, I was still on the unemployment benefit. In New Zealand, you can earn up to $80 per week before you begin to lose your benefit, and after that, they reduce your benefit at a gradual basis. This made it easier for me to get through those tricky first few months until I felt I had sufficient work coming in so I could come off the benefit (a truly happy day for me).

Set Your Categories

You will need to think about the types of work you are prepared to undertake. I recommend that you use all of the categories that Upwork permits you. Check out a few positions in each group before you select it, however. There are some notoriously low paying categories, particularly in the Admin Support area, which you should avoid. You won’t be able to compete with low-paid Filipinos for this kind of work. (Of course, if you come from the Phillippines or another low-paid country, take advantage of these categories if you choose).

Your Portfolio

You may not have particularly many items if any, that you can put in your portfolio at the beginning. If you have something suitable as an example of what you can achieve, upload it so people can see your capabilities. I wrote workbooks for my students when I was a teacher, so these were the first items in my portfolio.

As you gain work, add new items to your portfolio. Make sure that the person you did the job for agrees to your using it for your portfolio, however. You can’t use anything that was performed as part of an Upwork contract without first clearing it with the client.

The Tests

Upwork has numerous tests, covering a wide range of fields. I strongly advise attempting tests in the categories that you offer your services. If you can, try the tests for various countries too. For instance, although I am New Zealand-based (and NZ English is very similar to UK English), I made a point of sitting US versions of tests, to improve my chances of getting work with American customers.

You want to have at least three tests showing on your profile as soon as you can achieve them. If you can reach the Top 10% in any tests, that makes your chance of being accepted into contracts even greater.

Apply For Jobs

Once you have set up your profile (and hopefully passed some tests), you can begin to apply for jobs on Upwork. Be aware that there is a quota on your job applications (called Connects), which you can increase if you pay for an Upwork Pro account. 

With the basic free Upwork membership plan yu receive 60 Connects per month. If you upgrade to the Plus plan, for $10 per month, you gain an additional 10 Connects per month. You can also buy additional Connects, and unused Connects roll over into the next month.

Don’t worry about this limit on Connection, however. All this does is force you to only apply for jobs that are suitable for you. Don’t waste them applying for jobs you don’t want to do, anyhow.

When you apply for a job on Upwork, you will see how many other people have applied for the position. Don’t take too much notice of this. Many of these will be spam and people who clearly don’t match the job description. If you feel you are capable of performing the work, and it interests you, put together an application.

Quite a few of the jobs will ask you specific questions. Give thoughtful answers to these questions, making sure that they cater to the particular situation. However, don’t get too detailed here. People only have so much time to spend reading job applications.

You can recycle your cover “letter” to some extent, but without it being too obvious. You do need it to look like you are connecting to the particular job. Make sure you use the person’s name and job position applied for somewhere in your “letter”. Your first paragraph should be customised to the job in question.

Check for Replies Regularly

Once you have applied for contracts, you must check on Upwork (or in your email of you have set it up for that) multiple times per day. People expect you to reply within 12 hours of them contacting you.

Keep on making a few job applications every day until you get sufficient jobs to fill in your available time.

Over time you should be able to make a good income from freelancing, while also giving you time to work on building your primary future source of income.

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