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What is freelancing and how to make extra cash with it

What is freelancing, anyway? You’re probably familiar with the struggling freelance archetype – you know, the musician who pays the bills by writing jingles for commercials. But freelance work can be very lucrative. You don’t have to be an artist either (although there are plenty of opportunities for graphic designers, multimedia artists, and web designers as well).  

In 2019, the freelance industry yielded a whopping $1 trillion  – that’s on par with the construction industry and accounts for nearly 5% of the US economy! While you may not be making six figures right away like these hustlers, research by ZipRecruiter found that the average freelance writer in the US makes about $30 per hour, which translates into an annual full-time salary of $63,488 before taxes. Sign us up!

Back to our central question: what is freelancing? Well, if you’ve ever found yourself wishing you had an extra hundred dollars in your bank account at the end of the month (you’re not alone!), freelance work could be the answer. Here’s what you need to know to decide if a freelancing job could be right for you.

What is freelancing?

A freelancer is a person with a skillset or service who is self-employed. Instead of working for an employer for a salary, freelancers are hired by clients for a short amount of time or to complete a specific project. The beauty of freelancing is that you can work as much or as little as you’d like.

If you are just looking for a way to save up some extra cash for a dream vacation or to cover some of your bills, a few hours a week might be all it takes. But, if you find your side hustle going really well, freelancing could even replace your full-time job. 

But what if you don’t have any specialized skills? You might be more qualified than you think. Are you extremely organized? Try working as a virtual assistant. Good with numbers and spreadsheets? You could become an online bookkeeper. Enjoy helping others? Why not try a gig as a virtual customer service representative? Really, freelancing opportunities are endless.

What is so popular about freelancing?

In recent years, freelance work has become extremely popular. A study by Upwork estimated that in 2019, 57 million Americans carried out some form of freelance work – that’s about 35% of the US workforce! Among younger generations, the rates are even higher. An estimated 53% of Gen Zers and 40% of Millennials are part of the freelance economy. So, what makes the gig economy so popular?

The income gap

It’s no secret that in recent decades wages haven’t kept up with inflation and rising costs of living. With skyrocketing rent and housing costs, the overwhelming student debt loan, and the ever-increasing out-of-pocket costs of healthcare, many Americans are feeling the strain on their budget. Freelance gigs are one way of making up for the gap between your income and your bills.

Be your own boss

Say goodbye to taking orders (except from your client — the customer is always right, after all)! As your own boss, you get to decide which projects and which clients to take on.

Flexible hours

The beauty of being your own boss means that you also get to be the master of your schedule. If you want to take time off to travel or spend time with your family, you have the freedom to control how much or how little you work. For this reason, freelancing can be a great option for working parents.

Work from anywhere

Unless you’re driving for Uber, many freelance gigs allow you to work from the comfort of your own home, or anywhere in the world (hello, beach vacation!). If you freelance full-time and are fed up paying high rent, working remotely could also enable you to move to a city where the cost of living is more affordable.

What are the drawbacks to freelancing jobs?

Freelancing also comes with some drawbacks, so you might not want to quit your 9-to-5 just yet. 

Stability

If you’re just getting started, you may not have a steady stream of gigs coming in right away. Depending on your industry, work may be sporadic or seasonal (like the demand for photographers and DJs for summer weddings). It can take time to build enough business to have a reliable source of revenue. 

Benefits

You also won’t have access to benefits typically provided through an employer, such as health care or paid time off. 

Taxes

Freelancers still have to pay taxes on their earnings. In addition to income tax, freelancers pay a “self employment tax,” which covers Social Security and Medicare taxes usually paid for in part by employers in the US. You’ll have to make sure you work these expenses into your budget so there aren’t any surprises come tax season.

Despite these drawbacks, if you’re looking for a way to supplement your income or take control of your work-life, freelance work may be just right for you.

Five freelancing jobs to get started

 Are you convinced yet? Here are some freelancing ideas to get you started:

  • Write. Given the fast-paced nature of the modern workplace, companies are under pressure to publish content to keep their customers engaged online. There are numerous opportunities for skilled writers to create blog posts, magazine articles, grant proposals, or ghost-written pieces. You might also find clients looking for help with resumes or college admissions essays.
  • Drive for a ride-share company. If you have a driver’s license and access to a car, driving for Uber or Lyft could be a good option for making some extra cash. This option may not have the highest yield, but unlike other options, you don’t have to waste time building a client base.
  • Transcribe. Are you a speedy typer? There are people willing to pay you for that! Working as a transcriptionist requires little-to-no experience. All you need is a good internet connection and a keyboard. Essentially, you listen to audio files and type out what you hear. It is also one of the fastest growing areas of freelancing.
  • Tutor. If you enjoy teaching, put your knowledge to work for you. Websites like VIPKid connect you with students learning English as a second language (ESL). Or, if you have expertise in an academic field, you could become a test-prep tutor for important university entrance exams or courses. Did you know that you can see postings for tutoring jobs online at Care.com?
  • Translate. Do you speak another language? Consider putting your language skills to use as a translator. There is particularly high demand for translation within the legal and medical fields, and these specialized areas usually pay a premium rate. You can also find work as an on-call interpreter to interpret over the phone in real-time.

None of these ideas speaking to you? Try browsing job postings on freelancing websites like Fiverr or Upwork to see what other gigs are in demand. You can also take a course to learn one of UpWork’s 20 most in-demand skills.

Freelancing is all about empowering yourself with the extra cash, flexibility, or creativity that a normal 9-to-5 can’t offer. So, have fun with it! Try it out for yourself and see why 57 million Americans are already leveraging the gig economy to achieve their financial goals.

Once you’ve got your gig going, be sure to review the rest of our tips from the Academy library to make your money go farther! 

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