The Pros and Cons of being a Freelancer

The number of people, who work as freelancers , is continuously rising. Typically, professionals whose respective occupation ranks as one of the so called “catalog professions” work on a freelance basis - such as doctors, tax consultants, advocates, a.s.o. However, more and more architects, engineers, journalists, artists and more such professional groups are interested in working on a freelance basis. In the following, the pros and cons of working as a freelancer are presented.

The Pros of being a Freelancer

The Independence

Freelancers aren’t bound to the structures of employment relationship and are therefore mostly independent. A freelancer can fulfill himself to an extent thanks to his independence – at least a lot of people see it as such a possibility. Through the freelance working it’s possible to leave the stress with your supervisor and colleagues behind yourself and do what’s close to your heart.

The Freedom

One of the most known advantages is the greater degree of freedom that a freelancer enjoys, contrarily to a permanent employee. Freelancers can decide themselves when they want to do their work, which means, that people who are early birds can start doing their work in the morning hours while late risers can work later that day.

Said freedom regarding the scheduling of the working hours is healthier and entails an increased efficiency. Moreover, freelancers have more freedom in regard to the choice of their projects – obviously that depends on whether the order situation is good or not. Even regarding the priority setting, freelancers enjoy a certain freedom.

Furthermore, freelancers can decide themselves from where they want to work.
Typical options are, obviously, the working from home or from a coworking space, but also from anywhere outside of Germany (e.g. Lanzarote).
It’s clear, that freelancers can’t decide completely freely where they want to be at, since some clients wish for regular meetings that they would rather do in person instead of, for example, via Skype. In this case, it’s necessary to satisfy the client’s demand.

A higher income

Freelancers often can earn more than ordinary employees when their acquisition is doing well. When the order situation is good, freelancers even have the choice to refuse unprofitable offers. A freelancer determines his own hourly wage, but has to pay attention not to calculate an hourly wage that is too high. Furthermore, a freelancer has to keep in mind, that he has to face higher expenses than a permanent employee. The expenses obviously have to be covered and therefore, they have to be kept in mind when the freelancer is determining his own hourly wage.

No major obstacles

When wanting to work as a freelancer, relatively small initial investments are an advantage. A freelancer can profit from home office and consequently, he doesn’t have to face additional office costs, since usually just a computer with the appropriate software is needed and this equipment normally is already available. That obviously isn’t the case when the freelancer has to equip a representative office because he’s an advocate or when he’s a doctor and therefore has to equip a medical practice.

Cons of being a Freelancer

All-round abilities are needed

A freelancer can’t rely on his professional competencies alone. Aside his professional skills and competencies, it’s necessary for the freelancer to have knowledge of the organization of the accounting, client acquisition and networking. Furthermore, a freelancer should have a knack for negotiations, for that is extremely advantageous concerning the discussion with the customer - especially when it comes to fixing the prices.

A very high expenditure of time

Usually, a freelancer faces longer working times than an employee. This is the case in particular in regard to phases, that are characterized by hectic – for example when a project has to be completed. During such phases, a freelancer has even less free time – both at the end of the working day and at the weekend. Employees can, contrarily to freelancers, go home after the working time is terminated. Freelancers on the other hand have to complete projects on time and that means, that the time is irrelevant in this context and that the freelancer sometimes has to work very late on his projects. And even when there aren’t any projects to work on in the evening, freelancers have to use the time to expand their network, which forms the basis for their success, and should to participate in networking events.

Precautions are a private matter

The cooperation with freelancers is particularly attractive for companies, because freelancers aren’t subject to s***ocial insurance contributions***. A freelancer is solely responsible for the corresponding precautions - not the contracting authority.

That means, that the freelancer has to care for the health, nursing and social insurance himself. Same goes for the pension plan. Moreover, freelancers are solely responsible for checking if an additional disability insurance or an insurance against potential damage claims is necessary.

Alone regarding sickness, no entitlement to leave

Another disadvantage is, that freelancers cannot profit from the same advantages that permanent employees have. That is the case in regard to paid sick leaves: A freelancer can’t rely on it, a permanent employee, however, can. Furthermore, paid holiday leave and obviously holiday pay or christmas bonuses are terms freelancers aren’t familiar with. Unlike permanent employees, freelancers also have to take care of further training themselves.

The entrepreneurial risk

A Freelancer enjoys a great level of freedom that an employee doesn’t have. However, a freelance occupation is tied to a certain risk. That isn’t the case when working as a permanent employee, for a permanent employee doesn’t have to worry if enough orders can be secured throughout the next months – a freelancer, however, does.

Freelancers aren’t protected against dismissal and also have to face a financial risk. That is the case, since several months can pass until the invoice is settled. Therefore the very own capital has to be used to bridge that certain absence of payment.

A pretty lonesome daily routine

A freelancer, who makes use of home office, is mostly alone throughout his workday and he therefore can’t just converse with his colleagues and drink a coffee in between. That can lead to the freelancer growing lonely. That in turn has a negative effect on the respective freelancer’s network, on which his success depends on.

In order to exchange views with other freelancers and possible clientele it’s necessary for the at-home freelancer to actively arrange said contact. A possibility for connecting with other people again is renting a desk in a coworking space, since that more or less guarantees the exchange.