Self-employment is a dream that many fresh college and university graduates aspire to achieve. However, many individuals find that the trials and tribulations involved in setting up your own business are far more complex and demanding than they first assumed. There are many hurdles to overcome on the journey to becoming self-employed, and without professional assistance, there’s a lot of research involved in sourcing the best help you can get.
To help shorten your path to self-employment, here’s a brief guide that will cover most of the considerations and questions that you might have.
What kind of self-employment are you aiming for?
There are many different kinds of self-employment that you can consider. The easiest to start with is freelancing. Freelancing is basically doing jobs for various clients that could be local or international and it usually involves some kind of technical or creative skill. Some examples include freelance writing, graphics design, web design and programming. The other option is to start your own business, but it requires a lot of planning and good ideas to kick off.
Freelancers are hired on a per-job basis and getting clients involves self-marketing. It’s recommended that you set up an online portfolio so that you can display your completed works, previous clients and qualifications. It’s a good idea to try and link your freelancing speciality with something that you have experience with because an empty portfolio is a red flag for potential clients unless you’re fresh from college or university. For example, if you studied computer science then it’s a good idea to look for freelance programming opportunities. If you prefer to freelance in a field that doesn’t relate to your qualifications, then you will have to build up a portfolio by working as a volunteer for various businesses until you can build up a resume.
The main issue that freelancers face is a stable income. Despite being able to take on as many clients as you can handle, you might experience droughts of low workloads. It’s important to take on as many jobs as you can handle without stressing your body and always plan assignments ahead of time so you can determine how much money you can spend each month.
If you prefer to start your own business, then plan out your business strategy and products before taking the plunge and taking out a loan or setting up a company. Keep in mind that it takes a considerable investment to rent an office, recruit employees and market your brand. It’s a good idea for your startup to be trendy and tackle niche problems. Small businesses don’t have the global reach that larger businesses have, so you need to utilise smart internet marketing strategies to reach your intended audience.
Businesses tend to have many rules and regulations. For example, if you plan to play music or serve alcohol then you need to obtain permissions and licenses or else it’s a criminal offence. You also need to sign certain agreements when it comes to storing or using personal information of customers and clients. There’s a lot of consideration when it comes to starting up a business, so be sure to hire a personal assistant or look for an experienced business partner (such as a relative or friend) to guide you.
In terms of marketing for a small business, it certainly pays to look at local SEO (search engine optimisation). If you are operating a local business, you will find it a lot easier to rank. If we take a storage company as an example; it is very hard to rank for the search term Self Storage, but a lot easier to rank for a local term which includes the area/town/city for example: stroud self storage
Regardless of if you decide to freelance or start up your own business, it’s always a good idea to seek help from professionals who are willing to give you expert advice with your finances, ideas and legal issues. For example, services like yourvirtualofficelondon.co.uk offer you mail redirection services to give your startup business a professional exterior. There are also various cloud services such as online storage, bookkeeping software and human resource portals that can make managing your journey of self-employment easier to swallow.
Taxes and national insurance
When you receive wages from an employer, tax, national insurance and pension contributions are automatically deducted from your final wages which make it easier to manage your finances. However, when you’re self-employed, you have to go through self-assessments to pay your taxes, insurance and pension.
It’s important that you register as self-employed as soon as possible so you don’t get fined for avoiding taxes. Use online tax calculators to determine how much you need to pay and remember to calculate how much you need to withhold per week or month so that you don’t spend too much money. Since it’s not automatically deducted, you can afford to spend more money during certain months but that means for the next months you’ll have to save more money. Always keep an eye on your finances and don’t neglect the importance of bookkeeping.
What do you think the most important part of being self-employed is? Let us know below.