Whether you want to find a way to make a living around your own schedule or you simply want to make a few extra dollars on the side, the gig economy is a great way to make it happen. “Gig economy” is a buzzy internet term for all of the various platforms and companies that work with individual contractors—or freelancers—to provide short-term services for people who need them. Working in the gig economy can be as involved or as casual as you want; it’s all about how you approach it.
Those simply looking to make a few dollars on the side don’t need a full-on business plan, but some basic preparations are needed. On the other hand, if you want to be a successful freelancer who runs your own business, there are certain personality traits that will serve you well, including approaching the task with tenacity, a willingness to take risks, and the ability to adapt and solve problems.
Pick Your Gig
Obviously, you can’t drive for a ride-share company if you don’t have a car to drive. In that same vein, you can’t sell your skills as an app developer or graphic designer if you don’t have those skills. When putting your name out there, only advertise your ability to do something if you are confident in that ability. Putting a long list of skills together may look good on a freelancer website, but if you can’t produce a quality product, you are going to end up with unhappy clients and feedback to match it.
On that note, just because you can do something, it doesn’t necessarily mean you should be doing it in the gig economy. If you are simply looking for a way to make some money on the side but you already use your main skill throughout the day at your nine-to-five, taking on more of that work during your off hours may just lead to burnout. If you are looking to get into the gig economy as a way to scrounge up some extra cash, consider looking for freelance gigs outside of your normal industry.
Establish a Schedule
The freedom the gig economy affords people is often the same cause of their downfall. Left to our own devices, most of us are easily distracted, and we will put off doing what is needed in favor of what we want to do. Establishing a schedule complete with deadlines and weekly milestones keeps gig-economy workers on track so they can accomplish their goals and get to where they want to be.
Block off time for specific things you need to get done and focus only on the designated engagement at hand rather than attempting to take on multiple items on your to-do list all at once. Multitasking, despite how it sounds, is actually incredibly detrimental to productivity and will end up wasting your time and the money it is worth. Remember that when it comes to working in the gig economy, it’s produce or perish.
Be Smart About Money
Freelancers are paid in full by their contractors, but that doesn’t mean they don’t have to give their fair share to Uncle Sam. When it comes to working in the gig economy, this is often the biggest pitfall that can land a person in debt or worse. Having an established financial plan in place before you start raking in the dough can prevent serious problems later on.
- Before embarking on a full-time freelance career, pay off all major credit card debt along with any other major financial loans.
- Set up a retirement account that withdraws funds automatically.
- Put aside about 25 to 30 percent of what you make to pay the IRS and state taxes.
- Keep track of all business-related expenses you can use as deductions come tax season.
- Establish a savings account with about six months of living expenses set aside that you can lean on in case of an emergency.
The gig economy is ready and waiting for hungry freelancers wanting to work on their time. Picking a gig depends on you and your resources, so be realistic when it comes to what you can offer and what you want to do. Establishing a schedule helps gig workers stay on track so they can get things done. Finally, be smart about money when working freelance and put aside money for taxes and to be financially secure before making a major career change.
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