7 Common Mistakes Made by New Freelancers

Making a transition from employed designer to freelance designer can be intimidating for even the most talented of designers because there is so much more involved with being successful as a freelancer. As a freelancer you’ll be responsible for every aspect of your own business, and it’s those aspects aside from the actual design work that typically create the most significant challenges. While the transition is rarely easy, if you take a look at the mistakes that are commonly made by other new freelancers you can prepare yourself and avoid those potential pitfalls.

In this article we’ll take a look at 7 mistakes that many new freelancers make. The purpose is to help those of you who are in the process of moving into the world of freelancing, or considering it. By knowing these challenges ahead of time you’ll be better prepared to avoid them in your own business.

Discover how to use the best web design tools on the market plus increase your income to $125+ per hour. LearnWebDevelopment offers the best in freelance training. Learn More.

Mistake #1: Not Saving Enough Money Before Moving to Full-Time Freelance Work

This mistake often happens even before making the move to full-time freelance work. If you are planning to try full-time freelancing there are a lot of uncertainties about how much money you will earn, especially during the first few months while you will likely need to work harder to find clients while establishing your business. In order to avoid financial problems and more stress than needed, ideally you will have at least enough money to cover a few months of your living expenses in case things start slowly.

Many people leave a full-time job and assume that they will be able to start making enough money right away. In some cases it does work out this way, but not always. In fact. most new freelancers don’t bring in a whole lot of income the first few months, so that savings may be essential. Not only will it help your personal financial situation, but it will also prevent you from needing to go back to a full-time job right away because of upcoming bills.

Mistake #2: Lack of Planning for Taxes

Staying on the financial theme of the previous point, taxes are one of the most significant differences in working as an employee or being self employed. As a freelancer there will be no paychecks from an employer with taxes already deducted. Many freelancers underestimate the amount of taxes they will need to pay, or they simply lack the discipline to not spend the money.

You’ll have to be prepared and disciplined to set aside enough money for taxes, and you may have to pay quarterly estimated taxes throughout the year. Everyone’s tax situation is unique, so seek the guidance of a tax professional that can help you to plan. This way you won’t be surprised by owing a lot of taxes at the end of the year, and you won’t face unnecessary penalties for not doing things properly.

Mistake #3: Accepting Every Project that Comes Your Way

When you’re first getting started as a freelancer and you’re in need of client projects the natural reaction to an inquiry from a potential client is to want to jump into the project right away. However, not every project will be a good fit for you, and if you want to save yourself some headaches take the time to make sure any project is a good fit before accepting the work.

This is a mistake that I made in my early days as a freelancer and I learned quickly from a few bad situations that I needed to be more selective. This doesn’t mean that every project that you pass on is for a “bad” client, it just means that it wouldn’t be an ideal fit for you. In my case a client wanted to use an obscure CMS (content management system) that I’ve never had another request for in the years since. The price that I was charging didn’t justify the amount of time that was required to learn the CMS. I should have either charged more or used a more familiar CMS that wouldn’t require as much time. The project wasn’t a good fit for me because the client insisted on this particular CMS, and I knew it was something I would never work with again. It wound up being a waste of a lot of time that I could have used in other more productive ways.

It’s a good idea to think about the type of clients and projects that appeal to you. It could mean working with a specific industry, a certain type of design (example, web or print), a CMS, or even a specialization like e-commerce websites, PSD to HTML conversion, etc. Knowing your ideal project can also help you to know what projects simply don’t fit with your big picture goals, and when that happens it is a good idea to pass on the project. If you don’t want to completely pass on the project, make sure that you at least quote a price that is high enough to cover the loss of your time that you could be spending on other projects.

Discover how to use the best web design tools on the market plus increase your income to $125+ per hour. LearnWebDevelopment offers the best in freelance training. Learn More.

Mistake #4: Not Using Contracts

Almost every freelancer has a problem arise at some point from either not using a contract at all or not going into enough detail in a contract. This is a mistake that you probably won’t make too many times before you realize the importance of contracts, but it’s even better if you can start off by using contracts effectively to avoid any of these problems.

One of the most common problems that freelancers face (even experienced freelancers) is fighting scope creep. On many projects you’ll find that the boundaries of the project are pushed or stretched as clients ask or expect you to work on things that weren’t originally a part of the project when you provided the quote. A contract is an outstanding tool to help prevent scope creep because it allows you to clearly define what is and what is not included in the price that you are quoting for the project. This helps to get everyone on the same page, and then when scope creep sets in you’ll be protected and you can charge additional amounts according to the extra time that is needed.

Contracts are also helpful for establishing guidelines for when payments must be made, deadlines that must be met by both the designer and the client, limiting liability, and defining intellectual property rights. If you don’t have a contract that you already use on your client projects we have a few available at Vandelay Premier that may interest you:

Mistake #5: Starting a Project Without Collecting a Percentage of the Payment Up Front

Another common mistake that involves the financial side of running a business is not collecting a percentage of the payment up front. Contracts also help with this issue. By starting on a project with no up front investment from the client you are drastically increasing your chances of having problems with payments arise later. Getting a percentage of the payment up front will ensure that you are only working with serious clients and you’ll avoid wasting your time without getting anything for your work. Plus, clients will be more committed to the project since they already have something invested.

The up front money also helps to provide you with some income that may be needed before the project is completed. Clients who don’t pay anything up front are more likely to drag a project along slowly, which only delays your payday further if you are waiting until completion of the project to invoice the client.

Mistake #6: Jumping in to the Design Work too Quickly

Although the design and creative work is ultimately what motivated you to work in the industry, before you start designing for a client project you should dedicate the time necessary to adequately get to know the client, their customers, and the specifics of the project. Each client and each project is unique, and without investing the proper time to get familiar with the situation it is impossible to get the best results.

It’s a good practice to establish some sort of process for working with new clients so that you get to know as much as possible. Some designers like to meet with clients for face-to-face meetings when possible, others conduct interviews on the phone, some have questionnaire that they ask clients to fill out, and at times you may even need to talk to customers of the client in order to get their perspective. While this does take time, it will drastically improve the results for you and for the client.

Mistake #7: Working Without Tracking Your Time

As a freelancer, how you manage your time will be critical to your success. There are many aspects to running the business aside from just doing the design work, and in many cases it can be difficult to know how much time you are spending on different tasks. By tracking your time you will have a better picture of how your time is split between the different activities involved in running the business, and hopefully you will be able to identify any inefficiencies that could be improved. Especially when you are just getting started it is important to know how you are spending your time so that you can make the needed adjustments, and for planning your time.

Tracking your time is also very helpful for evaluating your rates. Without tracking your time you won’t really know how much time you have spent on a project. But if you do know how much time you spent on a project you can calculate the hourly rate earned on that project. New freelancers often find that when they calculate their hourly rate for a project it is much lower than they anticipated. Under charging is a common mistake for new freelancers, but by knowing how much time you have dedicated to past projects you can do a better job of estimating the amount of time needed for future projects, and you can improve your accuracy for developing quotes that will pay you a fair rate.

Tracking your time is also helpful to see how many hours you are working each week. If, like most freelancers, you are working from home it can be challenging to draw a line between personal time and work time. Tracking your time will help you to see the big picture of how much you are working, and hopefully it will prevent you from falling into another trap for freelancers, working too many hours. It’s important that you have enough time away from work and with your family and friends to avoid burnout and to help you to actually enjoy your work.

Published January 5th, 2012 by

Looking for hosting? WPEngine offers secure managed WordPress hosting. You’ll get expert WordPress support, automatic backups, and caching for fast page loads. Visit WPEngine.

Join Our Newsletter!

Subscribe to our weekly newsletter chalked full of useful tips, techniques, and design goodies. We have 20,000+ loyal readers and counting! We’ll even send you a free e-book (Freelance Designer’s Guide to Multiple Income Streams) and a $10 discount on our most popular product the Freelance Starter Kit.

22 Responses

Comments are now closed on this post.

  • Mukund, January 5, 2012

    Faced all the problems but still trying and hope after reading the above article i will get rid soon from these problems.

  • Courtney, January 6, 2012

    These are some great pointers.. Maybe there should have been a #8 added: Respecting your clients, because every client is potentially a return client.

    #7 is good, but some freelancers such as myself don’t charge by the hour. I charge two different ways. If a project consist of business cards or postcards with a simple design, I charge by the job. But the one sure way not to undercharge on big jobs is to charge a percentage of the job. That percentage is based on the complexity of the job that is being performed. For web design: pages, copyrighting, forms, flash headers, images, and web hosting factor into the price.

    Freelancers work from home mostly, so overhead is not such a big factor. Be fair in pricing.

    Offer something free, but inexpensive as a selling point (500 free business cards)

  • Vandelay Website Design, January 6, 2012

    Hi Courtney,
    Thanks for your comment. You don’t need to charge by the hour to still benefit by knowing where your time is going. If you charge $X,000 for a web design it is still extremely helpful at the end of the project to know how many hours you put into the project. The info can help to know what you should charge for future projects. Keep in mind, the article is geared towards new freelancers who probably have a hard time knowing what to charge.

  • Courtney, January 6, 2012

    Vandelay,

    You are right… i kind of left the subjet, but it is a good option for the new freelancers to know that there are options, but keeping up with time is important. When I started freelance designing, time was important for me because I gained an understanding how much time it took to design simple business cards compared to complex business cards. This is where the base of my pay started.

    #4 – Contracts: All newcomers should know this is one of the most important parts of doing business. No one contract fits all jobs!

  • Fiona, January 6, 2012

    All good tips, and I think when I started out I made most of them!

    At least I’ve learned from my mistakes, especially #3 – this week I turned down down a project as I knew I wasn’t the right designer for it. Although part of me thought it was a bad thing to be turning down work, knowing that I just escaped the stress coming from doing a project I’m not right for was a good feeling.

  • John, January 10, 2012

    This information is very helpful for me. I myself trying to start a php freelancing work. Specially, the rule # 4 is most valuable for me.

  • Sheldon Blake, January 11, 2012

    All very good tips. Thanks for sharing

  • Morgan & Me Creative, January 11, 2012

    It’s advisable to seek some sort of a downpayment. Firstly it goes to show that the client is serious about hiring you and also gives them the incentive to want to complete the job on time.

  • Designarcade, January 11, 2012

    Every point mentioned above is correct. These mistakes may happen for a new freelancer. It is a very common scenario. I think these guys learn from mistakes. But i suggest them to gather knowledge about freelancer with consulting other experienced free lancer.

  • Steven Key, January 11, 2012

    Mistake #1 is rightly placed #1! Before you make the jump to freelancing you need to make sure you have plenty of savings (and clients lined up) to fall back on – I would say enough to cover at least the first three months to give yourself a realistic chance of making a go at it. Clients payment terms may not be what you expect either and can even be 60-90 days depending upon the company and their internal payment policies.

  • Courtney, January 12, 2012

    Designarcade… So many freelancers want to keep their knowledge to themselves.. it is forums like this one that lend a big helping hand.

  • Jeff Schoolcraft, January 12, 2012

    I linked to this in my latest Freelancing Weekly issue – http://freelancingweekly.com/issue-9

  • Will, January 14, 2012

    Great article!

    I’m in my 3rd year of freelancing now but these are all things I faced at the start, and still face to some extent now.

    I think the most important thing (and the toughest) is to not take on every project that comes your way. If you can pick and choose, do it.

    The biggest thing I’ve learnt is to trust your gut on something too. If you get a feeling an inquiry/client is fishy and might be tricky to deal with, they usually are.

    Something that is REALLY vital to running a successful design business is providing a great service to your clients. Thats what keeps them coming back. Set their expectations from the start, keep them updated and go out of your way to be a great project manager too. If you find a high percentage of your clients coming back for me work, you’re doing something right!

    • Vandelay Website Design, January 14, 2012

      Thanks for sharing from your experience Will. I think you made a good point about trusting your gut.

  • Gogo Small Business Consultant, January 15, 2012

    Vandelay,

    Great points and great article.

    One thing I’d like to add is automatically positioning at the lowest price. Entrepreneurs generally think that they can solve the “not enough clients” problem with low prices instead of with lead generation, channel presence (or prospecting) and actual marketing systems.

    This is a big mistake. Typically, a customer who needs your solution will pay your price if you can make a case for why your price is worth more to them than it costs them.

  • Mark, January 15, 2012

    I am glad you put “saving money before full time freelance” at #1. This really cannot be stressed enough. I thought I had a good amount of money saved before I left my full time job, but a few unexpected expenses came up out of nowhere and I quickly found myself tapping into savings that I never planned to touch.

    Some advice to anyone making the change:

    1. Pay off large expenses like rent and car payments at least 4-6 months in advance. It will take a lot of sacrifice to make this happen, but it is really worth it.

    2. Try to get a solid part time job (10-20 hours a week) just to make sure you don’t go a full week without any money coming in. Or, look for clients who need weekly or bi-weekly newsletters or email blast sent out and have them pay an upfront retainer for your services.

    3. Always set some time aside each week to market yourself, make new connections, and be on the hunt for your next gig. It is important to have that next project lined up as soon as the current one ends.

    I hope my mistakes and learning experiences can help others!!! Good luck to everyone out there.

  • Ebony, January 17, 2012

    Hello, This is a GREAT article. I’m a “newbie” to website design, well I want say newbie I’m starting to get my feet wet. I came across your tutorials and they have really help me gear into the right direction. Do you have any advice for me?

  • Hector, January 23, 2012

    Good article, but I think 1 point was missing.
    As a freelancer is very important to know how much charge your clients, I have seen some guys not charging enough, then doing the mistake No 7, and at the end they are working for less than minimum wage.

  • AUDIOMIND, February 2, 2012

    What tools do you suggest in tracking time spent on projects? For yourself and clients?

  • Rajan Arora, February 15, 2012

    It’s a nice information.

  • 50r, October 27, 2012

    What i did when i started, was to also try make a use of these new small scale lancing sites. they helped me keep going without getting too much in my savings. one problem is top build trust that is very hard but as long as you are determined to make it you at the end make it.

    Small scale freelancing sites are those that you cant miss a shot to look at.