Feast and famine is a fact of life in the creative fields, whether you’re a writer, editor, web designer, illustrator, photographer or graphic artist. By creating a variety of income streams you can multiply your income and also fill in those odd hours between regular gigs.
When you’re first starting out as a freelancer, it’s not likely that you’ll be fully booked with clients at your dream rate. But you know that, right? It takes time to hang your shingle, acquire experience, build a portfolio, and woo steady customers. But that’s all right, because while you’re building your business, you have plenty of options.
Why should I worry about income streams?
Most freelancers start out part-time while hanging on to a career paycheck. Some take the leap to full-time immediately. Either way, you’ll want to quickly get your business to the point that you’re making enough income to pay your mortgage, bills and have enough left over to sock away for emergencies and rewards.
That means you need to optimize your hourly pay, minimize wasted time, and fill every nook and cranny of your calendar with either paying or productive time.
Freelancers are faced with basically four types of work. The first is called work-for-hire and it involves one-time jobs for a flat or hourly fee.
The second is really just more of the same, but now repeat clients bring a steady stream of work. While the pay may still be low, you no longer have to hunt for jobs like a hen scratching in the grass. This makes your time more profitable, even if you don’t raise your rates.
The third type of income stream is self-generated sales and royalties. It requires more work and investment of time up front, but once published, ideally you can sit back and watch your Kindle Payments report tick upward.
The fourth option is to offer exciting packages of services at a really profitable level. But like all self-generated work, this can require weeks or months of preparation. Meanwhile, who’s paying the bills?
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Organizing your work to optimize income
It’s best to have a plan when faced with a variety of income opportunities. Like the Chinese proverb says, a fox that chases two rabbits catches neither!
For new freelancers, I recommend a 30/30/30 plan. Spend 30% of your time working on quick, easy-to-get freelance assignments; 30% on finding and completing work for regular clients; and 30% of your week creating your own original projects. Each type of work offers its own risks and rewards, with varying rates of pay and payment schedules, which we’ll get into in a moment.
Most freelancers quickly discover that it’s wise to balance your priorities between projects that pay daily, weekly and monthly. As you acquire your sea legs, you’ll learn which jobs are more lucrative and fulfilling for you, and also what types of income streams interest you most.
Freelance gigs are a good way to get started
Let’s start with one of the easiest categories to break into, one-time freelance gigs. These are the types of assignments often found on content sites like Upwork, oDesk and Article Bunny. In addition to copywriting, editing, and graphics you may be able to get pick up work like transcribing, virtual assistance or video captioning.
Pros
When you’re starting out as a freelancer it may be difficult at first to drum up accounts without first having an established portfolio. Freelance sites are a good place to stretch your wings and find jobs that are right in your wheelhouse. While they may not pay much, they give you an opportunity to complete some jobs, get ratings and reviews, and add to your portfolio.
Some sites pay quickly, and that helps create some instant cash flow for you to live on while you’re building your new career. It’s also a good way to flesh out your monthly income goals if you’re falling a little short for the month. Most gig sites pay weekly. Upwork still makes freelancers wait several weeks for payment, and Article Bunny pays monthly. However, both Upwork and Article Bunny guarantee payment as long as your work is approved by their editors or moderators.
Content sites and work hubs are a good place for beginners to get started. Use filters to search for assignments on topics you’re familiar with.
If you deliver your best work, you might also strike up a relationship with customers who turn into long-term clients.
Cons
The downside of this type of work is that pay is low, the competition is fierce, and some sites keep 10-20% of your pay.
Much of the work is done as ghostwriting or work-for-hire and clients will not share the published URL’s with you, so you can’t feature it in your work portfolio.
Another drawback is that sifting through listings, crafting proposals and gauging how much to bid requires lots of time. You can speed up the process by creating one all-purpose cover letter, and then customizing it for each job proposal.
Regular clients are your income bedrock
Clients who provide a steady stream of work are your bedrock. These are clients who need weekly content or services for blogs, newsletters, websites, emails, advertising.
In addition to providing steady, predictable income, you are now spending your time making money, instead of bidding on jobs and sending out proposals.
Professional clients expect to be billed monthly. If you time your monthly billings on different dates for each client, you can space your income out—but that can be a lot of unnecessary work. For large clients, you can offer to send an invoice every time invoices reach a set amount, like $200 or $500. Or you can separate big projects into milestones. Smaller invoices make it easier for clients to pay willingly and you’ll experience fewer problems with late pay.
A one-time freelance gig might turn into a working relationship that lasts for years—so always put your best foot forward.
Pros
The main advantages of having regular clients are good pay and a steady stream of work. Plus, unlike one-time gigs, these clients are typically happy to be featured in your portfolio.
At this stage, you should consider raising your rates. You can still work at lower rates when you need one-time gigs to fill in the odd gaps, but steady clients will actually expect you to charge respectable hourly rates.
Regular clients are a much more lucrative use of your time—you can schedule blocks of billable time and you don’t have to spend as much non-billable time finding new clients and bidding on jobs.
Cons
Clients can be very demanding of your time one week and then pare back their marketing budget the next. You may find yourself swinging between working 30 hours a week for one client in a month, and then they’ll cut you back to four hours a week the next month.
You’ll need to be firm about how you budget your time between clients and projects.
Don’t rely on any one client too much, or spend so much time with one client that you lose others. Losing a major client can create a big hole in your income. Finding new clients to fill that gap takes time, and meanwhile, your bills will be piling up. Keep your workload balanced between various clients and projects.
Selling your own work is the Holy Grail of freelancing
Selling your own work is ultimately the goal for most creatives. The dream is to put enough stuff out there that will just sell—on multiple continents, in dozens of countries. You’ll wake up in the morning, check your bank account and voilà, there will be money in it!
Hey, it’s not that crazy. Even if you’re just starting out, having some royalties trickling in helps with expenses. Books, e-books, photographs, graphic designs or online courses—it all helps. As you get your sea legs you’ll discover where your real strengths lie, and you’ll also learn more about addressing niche markets and how to market yourself.
Pros
Royalties bring in an extra stream of income. It may not be large, and it may not be steady at first, but it will build as you grow your audience.
As you grow your fan base, you can also grow your mailing list. With smart marketing, you can leverage even a small success by contacting your already existing fan base and encouraging them to buy new releases. A growing email list will help with future marketing and is great for brand awareness. It’s also a powerful tool for attracting clients.
Royalties are inspiring. You may have been rejected by editors and clients but gosh darn it, royalties show you there are people who love what you do!
Cons
Unfortunately, it’s not as easy as it sounds. In addition to your first original works, you must also spend time building a website, creating an email signup splash and forms, and establishing social media accounts. It can take a long time and lots of persistent effort to get traction.
You need to study your competition to discover what’s already out there, what’s selling well, what the successful price levels are, and where the market is saturated. You also need to be aware of all the hidden costs—cover designs, self-publishing fees and costs, online software and platforms that you’ll need for sales.
Being your own boss as an author-creator also needs steady marketing. And by steady, I mean constant. When you’re selling your own work you can’t rely on a press release and a Facebook announcement. You need to have at least a three-month plan broken down into daily to-do’s and steps, and a content calendar stuffed full of daily social media tweets, posts, images, and promotions.
Offer a package deal
Once you’ve grown your business to the level that you have advanced skills, an online “persona” or successful work portfolio, and a collection of original work, you can start offering new services and package deals.
Chris Guillebeau, from the Art of Non-Conformity, saw the need for a conference in his niche. The World Domination Summit is now celebrating the 5th anniversary. Chris Ducker and Pat Flynn host one-day events called 1-Day Business Breakthrough.
Depending on your skill sets, you could offer:
- Editing with manuscript mentoring
- Ebook writing with formatting and cover design
- Website content and marketing with design, hosting and maintenance
- Blogging with writer’s coaching or business coaching
Pros
Package deals are a great way to capture steady clients and encourage former clients to return. You can charge excellent hourly rates, which means you can now multiply your income, spend less time bidding on jobs, and experience greater profits.
Working on complex projects gives you an opportunity to work with others. You may wish to create your own personal team at this point and bring in a graphic designer, a cover designer, a web designer and web hoster.
Rather than trying to learn new skill sets, it will be much more efficient when you reach this level to return to the one-time-gig sites you frequented earlier and hire your own freelancers to support your growing business.
As you move closer to financial stability and have your own blogs and books to promote, you can develop even more streams of income based on your creative work.
Other ideas for branching out or offering more services:
- Teaching
- Coaching
- Brand ambassador/blog reviews
- Ebooks and digital products
- Instructional videos, action plans, tutorials
- Webinars and teleconferences
- Affiliate marketing
- Accessories: hats, t-shirts, aprons, mugs
Cons
Working with multiple skills and package offers may require more coordination with clients and partners (which some people love, others don’t). If you haven’t had experience in managing teams of creative workers before, this could be a very steep learning curve.
This level of sales may require even heavier marketing and advertising. Your rates will have gone up—a lot. That means you’ll need to reach a pretty large pool of potential customers in order to find the small percentage of clients who can afford and are willing to pay your rates.
But as your confidence grows, so will your business.
Wherever you choose to start out as a freelancer and entrepreneur, keep your options flexible. As your skills and experience increase, you can expand and vary your services to create steady streams of income and find success doing the work you love.