Female? Freelance? Chances are that you are often being asked to work for free or cajoled into accepting pay that’s beneath you. But no more! Young Money Blog is here to fight your corner. This is the ultimate freelance finance toolkit for negotiating better, earning more, saving harder and feeling happier in 2020. Read on for my analysis, some grim first-hand experiences and top tips for female freelancers everywhere
This year, I have been asked to take part in several panel events, podcasts and published interviews specifically centered on freelance finances. This has has been a real pleasure and privilege because I am (as you may already know!) an evangelical freelancer.
I wholeheartedly believe that freelancing is a game-changer for young people, particularly young women, who can harness technology to build lucrative careers, with purpose, on their terms. But it’s not all plain sailing.
I will be in the Financial Times again very soon talking about the bête noire of freelancers everywhere – late payments and absurd admin imposed by clients. And female freelancers who are working in creative, activist and tech industries (to name just three) have been speaking out about the challenge of getting paid at all.
Freelancing is feminism!
Firstly, let’s unpack why all this matters. Freelancing is – undoubtedly – a feminist issue. According to IPSE, the association for the self-employed, the number of highly-skilled freelancers in the UK rose by 47 per cent between 2008 and 2018, and that was driven by a whopping 63 per cent rise in highly-skilled female freelancers.
Make no mistake: even as more women enter the workplace, more and more are then pivoting towards freelance life. Unfortunately, this is as much an indictment of structural inequalities in the workplace as it is testament to the liberating, pro-woman alternative that is freelancing. To quote the journalist Anna Codrea-Rado:
“I’ve lost count of the things that have exhausted me [about workplaces]: the security guard who told me to smile every morning, the senior male colleague who cornered me at after-work drinks to tell me about his sexual exploits, having to remember to bring a jumper in high summer because the air conditioning feels colder to women than to men.”
This “death by a thousand gendered cuts”, as she describes it, is what’s driving many women towards more freelance careers outside the workplace. The good news? These alternative careers can be more rewarding, in all senses of the word, for women than full-time positions.
Freelancing doesn’t completely obviate the need for outsourced childcare (most mums still need uninterrupted time for working, and granny can’t always babysit) but it can massively reduce the cost. Establishing a career through the internet is possible wherever you live, whatever your domestic circumstances, and however you wish to work. It *is* possible to earn more and work less in a way that’s usually not allowed in the rigid and hierarchical confines of a workplace.
What’s more, women pursuing innovative, even radical vocations (particularly in the BAME community) have a much greater chance of breaking through if they can better dictate the terms of their career. Want to start an influential blog? Go for it. Want to create a hit podcast? Nothing to stop you. Want to write a best-selling book? I look forward to reading it.
Women as successful business owners, coming from diverse backgrounds and pursuing *their* agendas, is a relatively new development in the world of work. We are all pioneers, treading new ground in our industries and making up new rules. With that comes uncertainty, setbacks and (sadly) frequent battles to assert our worth.
A leap in the dark
The biggest problem when you freelance is the great unknown. Or should that be unknowns, plural?
If you decide to make your side hustle a full-time career, you can’t be sure that it will work out. If you do start establishing yourself as a freelancer, you can’t know for certain how much you’ll earn from one month to the next (though you can, and should, build a baseline of income to see you through, no matter what).
And female freelancers often lose out because they don’t know the real lie of the land. Can I charge for doing this? If so, how much? Is the promise of exposure a real benefit or an exploitative con? If I overcharge, will I lose this work? Do I need to over-deliver to prove my worth?
It doesn’t help that some female influencers, understandably overjoyed at their success, are prone to boasting about how much they earn from their online endeavours without accurately reporting how hard they’ve had to work or what advantages they may have enjoyed. That may be one reason why I have seen a spate of full-time female bloggers recently posting about how they’ve had to take menial jobs or seek solace in friends because they cannot yet make a living from blogging alone.
I commend these ladies for their honesty and wish them the very best. But I am surprised at how quickly they expect success to come. One felt she had paid her dues after two years, another quit her job just six months ago. It took me five years and various jobs before I could successfully freelance full-time on the back of Young Money Blog. Even with a strong USP and an early mover advantage, there were innumerable setbacks for me along the way. But the “secrets” for success shouldn’t be kept a secret. Otherwise, we are setting women up for a fall.
That’s why there has been a concerted movement to try and get these issues out in the open in recent years. Only by discussing them with other women in a similar boat can we discover what’s possible. There’s the website Time = Money, set up on the back of a WhatsApp group for female freelancers called FU Pay M£. The name of the site is perfect because time really is money for freelancers. And that’s the rationale for the site’s helpful table of fees that all freelancers should insist on *as minimum*. Turns out that freelancers are entitled to ask for payment for all kinds of requests, from appearing on panels and running workshops to providing expertise to companies or allowing them to “pick your brains” for a few hours.
But I have a controversial thought. What if these fees are still too low? What if female freelancers are still doing themselves down by accepting rates that don’t reflect the time, energy and skill these jobs require? This leads me to my boldest tip for freelancers in 2020. It applies to both sexes but I think it’s particularly helpful for younger female freelancers, who aren’t quite as used to the cut and thrust of business as male entrepreneurs and are definitely conditioned to be meeker, more pliant and less hard-nosed about these things.
If you have a standard freelance fee that feels right…double it.
If you typically ask for £100 to do an event, ask for £200. If you ask for £500 to do a day’s consulting, go for a grand. You get the idea! It’s very simple.
I can’t pretend that this is based on a rigorously-worked out scientific equation or a comprehensive dataset. It’s purely based on my 4+ years as a freelancer, realising that if I don’t keep pushing the boundaries of what I ask for, the default setting will be stagnation, with the very high risk that my freelance career would become otherwise unsustainable.
However, there are 3 scenarios where this rule would (or should) not count:
- you are asked to do a charitable or educational turn. I don’t charge any charitable or non-profit organisation and I’m always happy to give up my time to speak in schools, colleges or universities. But be careful you aren’t being used by a company to burnish their CSR credentials on the cheap. Last year I was introduced through a mutual contact to an investing company that wanted to produce a game to coincide with Talk Money Week. The company was teaming up with a financial education charity and wanted me to front the game. Part of this involved attending meetings and taking time to present a video. I am happy to get involved with anything that educates the next generation. But everyone else involved with the project was on paid company time and what’s more, the game was explicitly designed to attract young people to a specific kind of investment product that the company sold. When I eventually asked if there was a budget, I was told ‘no’ and that was the end of that. But many weeks were spent exchanging emails and trying to arrange meetings before I cottoned on. Don’t repeat my mistake!
- you want to do the work so badly that you genuinely don’t mind what the fee is. This isn’t about how objectively worthwhile the opportunity is. It is entirely subjective and dependent on your needs. You are in the best position to assess whether the opportunity is too good *for you* to turn down and will really help take your career to the next level. It isn’t true that freelancers should never work for free: there are a minority of cases where it’s justifiable, although these should rapidly diminish as your career advances. But before you say ‘yes’, think about whether you can at least ask for expenses or a nominal fee. You could make it clear that your participation isn’t conditional on being paid, but that it would be your preference. That might tip the client into throwing your something: you never know.
- you shouldn’t be accepting the work, whatever the cost. At the other end of the spectrum, you may get offers that you should never accept, however high the fee is. Maybe the work would harm your reputation, present a clear conflict of interest or (most importantly) become a distraction from the core work that you should be doing. Freelancers need to keep continually assessing what opportunities they need to pursue and what work is really beneficial to their long-term plans. For instance, if you need to write that book, you’ve got to set aside time to do it: it won’t write itself!
Otherwise, try my “double it” rule. What’s the worse that can happen? Okay, a client may ghost you and give you no opportunity whatsoever to come back and negotiate. If that’s the case, you really don’t want to be working with them anyway because that’s a shoddy way to treat people and a reliable indicator that they could turn into a nightmare client. If the client completely baulks at the price, you can enter a negotiation and you’ll usually reach a fee that is the same or higher than your ‘standard’ rate. But you may be pleasantly surprised at how often the client will say ‘yes’ to your new quote. And that’s because you are probably already undervaluing the work you do – by doubling it, you may just be getting to the fee you should already be quoting!
A fair deal for freelancers
One of the most awkward aspects of being a freelancer is having the pay conversation with clients. Although most of the time, we don’t actually need to have that conversation in person or even over the phone. Most of our correspondence today is by email, which has its pluses and minuses in relation to pay.
On the plus side, it means we don’t have to be put on the spot and get bounced into accepting a raw deal out of politeness. We can take our time to mull over the offer and respond with the best choice of words. On the minus side, it means people can throw out all kinds of vague requests which require you to read between the lines before asking for clarification. Clients may approach you without even mentioning budget. So that means you have to waste your time asking for information that should have been there from the get-go.
Bryony Farmer, the founder of Time = Money and a small business that sells reusable menstrual products, told Glamour earlier this year:
“I would love to see it become more commonplace for companies contacting women for their expertise, whatever it may be, to list in their initial email what the fees are. This would make it much easier for us to know when there’s room to negotiate, without taking advantage of the fact that women are more likely to work for free.”
I couldn’t agree more. But I will keep expecting those gnomic requests to pick my brains, moderate conference sessions, speak at events or contribute blog articles without any reference to pay. What’s changed is the way I deal with them.
Be ruthless on email
I used to agonise over every email I got, wondering about the best way to respond. It was partly fear that I would lose the ‘work’ if I mentioned, however diplomatically, the issue of fees early on. I was polite to the point of paralysis – I’d put off emails, then spend an age crafting them, then hang around in my inbox waiting for the response. It’s no way to operate, not least because it’s incredibly distracting and energy-sapping. Ultimately, if people want to work with you, it’s because you’re good at what you do, not because you said the right combination of magic words on email. And conversely, if people want to exploit you, it doesn’t matter how nice or fulsome you are – you’re not going to elicit a different response. Always be pleasant and professional. But don’t give your correspondence anymore than it really needs.
I don’t subscribe to the theory that you should have a template response to save time. Each freelance query is case-by-case and I think it can seem rude and dismissive to send back an obviously formulaic response. I’ve tried and it didn’t work for me.
But even if the email you get is a long one, it doesn’t require The Odyssey in return. Thank them and be positive about what they’re suggesting, then use a form of words along the lines of: “it would be great to get a sense of timings and your budget – then we can take it from there.”
It’s also a good idea to discourage any chancers or at least manage expectations by making your terms very clear to anyone thinking of approaching you. You could do this on your website (ala Reni Eddo Lodge’s badass FAQs) and/or through your social media profiles. A filter system can also help. You have no idea how much irrelevant crap gets sent to me via the Young Money Blog’s email addresses, no matter how many disclaimers I put up. So I have multiple public email addresses to try and appropriately funnel the requests I get. Then I take more promising correspondence to my more direct email address, which I don’t publicise on my site.
Here are some more tips for managing your freelance finances in 2020…
1. Enforce boundaries
How can you successfully freelance without going quietly round the bend? Don’t blur the lines. That applies to your finances, your time AND your identity. Make sure you demarcate the following:
- your professional and personal time
- your public profile and your private life
- your business expenses and your personal spending.
You can achieve that last separation by having two accounts. This could be a business + personal account but if you’re at the early stages of freelancing, two personal accounts is absolutely fine. Just make sure all your invoices are paid into one. and use it to deal with business expenses too.
2. Pay yourself a salary
Once you have a personal account, be your own boss. Transfer the amount you can reasonably live on from your ‘work’ account each month at the same time. Try to keep it consistent, even when you have a good month, and lean towards a more conservative estimate. Over time, you can give yourself a pay rise (hopefully because your pay is going up!) but it’s important to be low maintenance in the beginning while you are still establishing yourself.
3. Keep track of invoices
Some people swear by freelance apps (like Mettle) and accountancy software which helps you create, send and monitor invoices. Others have outsourced the whole task to services like Free Agent, which automatically chases up on invoices on your behalf (at a cost!). But it really isn’t that tricky to track invoices. The key is being organised. Create a standard invoice template which makes your payment terms clear. You might want to refer to the Late Payment of Commercial Debts Act and state that late invoices (i.e. those not paid within 30 days) will be subject to penalties and late payment interest. It shows that you know your rights and might focus your client’s mind. Then make a note in whatever format suits you of when the invoice was issued and what its value was. Check in once or twice a week to ensure you are getting paid. Send a standard chaser email for any overdue payments and reiterate your legal rights: this normally does the trick.
4. Save what you can, when you can
Freelancers struggle to save more than anyone, and yet they need a rainy day pot the most! The trick is to open an easy access account and save between 10 and 20 per cent of your income each month to cover your tax bill, pay for emergency expenses or simply tide you over in quieter periods. If that sounds too ambitious, you could try round-up saving pots on apps like Monzo or Starling so you can save spare change into an easy access account every day. Or when you next have a big payday, aim to put 25 – 50 per cent in your savings straightaway. If the worse comes to the worse, you can always get the money back out again. But aim to have a fatter savings pot and thinner spending account so you have a decent buffer in your finances (without veering into your overdraft, of course).