Image from Author's financials
If you have a job in a company, you’re expecting your paycheck at the start of the month. What would happen if you don’t get it this month?
Something must have gone wrong with the human resources department. If you head there, they’ll clear it out as a systematic issue, and you’ll receive the full amount as per your legal contract with your company. Such mistakes almost never happen.
Welcome to the everyday life of a freelancer. This image represents some of my actual earnings last year, which as you can see, are looking like a zigzag. I would work hard in a month to reach $10k, and then loosen up a bit and focus on the quality of delivering work to my clients instead of signing new ones so I’d get a drop in revenue.
Alternatively, I might just have a bad month. My services might not be interesting for the world this month, compared to the last one, which is normal.
This is one of the most empowering lessons a freelancer learns in her/his journey. It’s okay to be living on the edge because it always works out. I’m not saying this is healthy. I’m saying that expecting the unexpected strengthens one’s psychology, and prepares a person to be able to accept what one has right now.
Additionally, it forces the freelancer to learn more in regards to why the drops occur, and how to prevent them.
A closer look
A closer look would indicate that in a good month, a good average freelancer would be making more than what an average employee would do. If we’d compare two individuals, a freelancer, and an employee with the same average annual pay.
The difference between those two would be mainly in regards to assessing the effort. As an employee, you could flip your whole world, and you’d get good KPIs, possibly a raise in a year or so.
As a freelancer, if you’d flip your whole world, it would instantly show as conversions are easy to track.
Is it okay to have zigzag earnings?
As long as one is aware that the paycheck comes bigger, but with risk, then there’s no problem. The worse option a freelancer could go for is getting a bank loan or a similar commitment that requires a steady paycheck.
There are levels of freelancing, and this is just one. Some freelancers have been doing this for quite a while that they figured out how to stabilize the chart. How to almost get an increase every month. Those are playing the freelancing game perfectly.
Additionally, there are others who are wise enough to always specify part of their income in savings. Freelancers who do so are whom I’d call “smart investing freelancers”.
How to resolve zigzag earnings?
There are multiple approaches to this behavior and it depends on why the zigzag earning is occurring.
- If the zigzag earnings are due to the fact that the freelancer is easing in on signing new clients to resolve what she/he already has, then outsourcing, getting support from a team, or signing fewer clients might be solutions.
- If one is doing everything that could be done, yet the cash flow is still zigzagged. Then, in this case, one has to conduct further analysis. Something is not right, and the solution lies in the clients’ feedback.
Some of the important acts and habits that help in this process.
- Decreasing time waste
This is vital, specifically, for the life of freelancers. The only stable variable that you have in your work life is time. The more the waste, the less the growth.
- Increasing work efficiency
You could sit in front of a computer for 5 hours and do what people do in 2, or vice versa. Monitoring efficiency per hour is as vital as what is done during those hours.
- Laying off work
Some of the most brilliant freelancers I know are sometimes not in their perfect form, just because of the feeling that life revolves around work. Sometimes, a simple week of not working does magic.
- Having a balance
In order for the freelancing life to make sense, one has to account for everything else. In a normal workplace, people spend some time speaking to other people. Even if this is about work, the physical human interaction gives both parties a human feel which is required for anyone. Hence, a freelancer must account that this is not easily available and find this elsewhere.
- Analysis and figures
Constant learning and monitoring are always needed to be able to improve and evolve. The only way that would happen is to have as many statistics as possible that could be of good use.
Finally, some freelancers are comfortable with “zigzagging” and would not wish to change a thing. Part of the thought process of a freelancer is to work very hard to obtain clients. If one has enough clients, then a feeling of safety starts to spread, which could lead to simple laziness in maintaining financial growth. This would highly depend on the freelancer as a persona and could only be changed from within by promoting healthy habits and having the ambition and desire to become more successful.
I’m Al, a business consultant in Zurich, Switzerland. I believe in the power of delivering value to you, the reader. I’m focusing my content to be more and more on Medium, and Linkedin. Hence, follow me on both channels to keep in touch and connect.