What is it like to work Free Lance?

[BellyGirl]

I've just started working Free Lance 2 mths ago. It is a horrible start. I estimate that i only earn 40% of what I used to earn. And I didn't earn a lot in the past anyway as an average lowly office executive.

My main problem is that my work assignments (I teach music in schools, teach science in tuition centres and give home tuition to two kids seperately) make me travel everywhere.

I drain energy from

a) travelling. Sometimes I travel one hour from one place to another.
b) messy schedules, rushing from one assignment to another.
c) children drain me when they want attention
d) classroom teaching drain me (as many as 40 8-yr old kids in a classroom) cos i cannot manage them well

Does anyone have similar work? would love to hear your tips.

[Lakshyayidhi Lakshmihi]

I do some freelancing writing. Just stupid article filler crap for websites. The tax rate is outrageous. 1099-MISC - FML. 30% tax rate on the schedule C? bullcrap. I'd rather get paid under the table.

Now I know better.

[NickWeb]

Originally Posted by BellyGirl

I've just started working Free Lance 2 mths ago. It is a horrible start. I estimate that i only earn 40% of what I used to earn. And I didn't earn a lot in the past anyway as an average lowly office executive.

My main problem is that my work assignments (I teach music in schools, teach science in tuition centres and give home tuition to two kids seperately) make me travel everywhere.

I drain energy from

a) travelling. Sometimes I travel one hour from one place to another.
b) messy schedules, rushing from one assignment to another.
c) children drain me when they want attention
d) classroom teaching drain me (as many as 40 8-yr old kids in a classroom) cos i cannot manage them well

Does anyone have similar work? would love to hear your tips.

I had a similar work schedule as yours. I was a freelance language teacher. I worked for 2 language schools and had some private students, besides this I worked for a company on a part time basis to sell some of its products. All in all I earned much more than a simple teacher but I quit them (the two language schools) one week ago, because of the messy schedule.

Now I am planning to find a job at an international company and maybe to start photography as a business. But at the moment I think a 9 to 5 work would suit me better.

Originally Posted by Lakshyayidhi Lakshmihi

I do some freelancing writing. Just stupid article filler crap for websites. The tax rate is outrageous. 1099-MISC - FML. 30% tax rate on the schedule C? bullcrap. I'd rather get paid under the table.

Now I know better.

In my country tax for self employed is around 40-50% so everyone is trying to trick the system as much as possible.

[Indiana]

I work freelance and it suits me extremely well. I earn more than I did when I was working full-time salaried. Of course, I have expenses I didn't then - like paying for my own healthcare, phonecalls, etc. But on the other hand, these are all now tax deductible expenses, plus I can claim other things as tax deductible expenses that I couldn't before (portion of rent, power, research materials, entertainment, etc) so it all kind of ends up working out in my favour.

First of all, what are you charging? If you work out what you were getting paid when you were salaried, your freelance hourly rate should probably be three times that. Otherwise you're undercharging.

Can you change the way that you teach, ie. start taking on small groups in your own home rather than rushing somewhere else to teach?

Are you claiming all the expenses you're entitled to as a freelancer? All your travel expenses should be tax deductible now. I realise that you don't technically 'get' this money until it's time to pay your taxes, so the first year can be tough, but it's a nice bonus if you can make it work.

Also, are your skills sufficiently valuable to allow you to earn a living as a freelancer? If you were a 'lowly office executive before', is the level of demand for a low-level skill group sufficient to be able to let you charge an adequate rate? By the time I decided to go freelancing, I was in a high-demand skill group. That's really what allows me to get away with charging the rates I do.

[Bliss Sage]

Originally Posted by NickWeb

In my country tax for self employed is around 40-50% so everyone is trying to trick the system as much as possible.

What country are you in? I'm trying to make self-employment work for me in Sweden, but, all-in-all, I have to pay about 43% tax on all I earn and I haven't been earning enough to even pay for my food and rent, let alone 43% tax.

[NickWeb]

Originally Posted by Bliss Sage

What country are you in? I'm trying to make self-employment work for me in Sweden, but, all-in-all, I have to pay about 43% tax on all I earn and I haven't been earning enough to even pay for my food and rent, let alone 43% tax.

I live in Hungary, where the average monthly wage is around 480 EUR net but product and rent prices are actually almost the same as in Germany for example.

[Lakshyayidhi Lakshmihi]

Originally Posted by Indiana

Are you claiming all the expenses you're entitled to as a freelancer? All your travel expenses should be tax deductible now. I realise that you don't technically 'get' this money until it's time to pay your taxes, so the first year can be tough, but it's a nice bonus if you can make it work.

Do you live in the US, or abroad? The tax law are very very different in the US, although I've only done canadian tax forms other than the U.S. federal and state forms (I used to do taxes, before I swore to the universe that I would never work in a cubicle again).

The deductions are pretty rigid and from my experience, self-employed people who file schedule C's tend to get audited at a much higher rate than people who are employed with a business and receive W-2s and unemployment tax deductions on a quarterly basis. I think this is just because people who are self-employed may not have much accounting acumen and they tend to make a lot of mistakes on their tax forms - so for an auditor, it's sort of a sure thing that you will find someone to get extra dough from if you pick a high percentage of self-employed people to audit.

There's no clearly stated policy regarding this, but...it just seems startlingly common.

The US tax policies are simply atrocious. Designed to protect the very wealthy and penalize middle income earners. It's been that was for decades.

[Indiana]

Originally Posted by Lakshyayidhi Lakshmihi

Do you live in the US, or abroad?

I live in New Zealand. But to be fair, I have no idea about the difficulty of the tax system in New Zealand. I have an accountant, and she deals with everything; I just save my tax and then pay it at whatever appropriate intervals.

[LostMyMap]

I've been on my own for over 5 years, but my gig is way different than yours. If I had do drive an hour each way to herd 40 eight year olds......

Your description of your job kinda makes it sound like you really don't want to be doing it. Draining. I don't know, that's something for you to work on if you choose.

But while you are doing this, just control what you can. One thing might be schedule. Over time, maybe you can slowly modify people's schedule with you so it isn't so messy. You are serving them, but you can still be a little directive with your clients. A sane schedule makes me feel a lot better.

As for the business aspect of it, I hope at least you are taking all your deductions. Every mile you drive, all your expenses. Quickbooks and a good CPA are your best friends. Note that this is all from a US point of view. Can't say for other countries. Overall, the US tax code favors businesses, even small ones, over employees. But you need the expertise to know how to use it.

Forty eight year olds. Hard for me to imagine!

[Silwer]

Hi Bliss Sage, I live in sweden to and i'm about to start my own freelance business. But I don't find the taxes that bad really ..
Or perhaps I only think that because I haven't started yet, but what I've been told by my business advisor those extra costs should be covered by your costumers so you do get enough money left to live on >.>