Getting paid as a freelancer is one of the most underappreciated business skills today. Marketing your business and delivering service to clients is a critical starting point. Yet, none of that matters unless you have a reliable, cost-effective way to get paid.
Using the tips revealed below, you’ll solve the problem of getting paid on time as a freelancer. Once you solve that issue, how much money can you realistically expect to earn? Like so much in business, the short answer is “it depends.” A few statistics illustrate what’s possible in freelancing today. But before that lets look at why freelancing is still so attractive.
1. Why Is Freelancing Still So Attractive?
Freelancing is highly attractive because it’s possible to earn over $100,000 per year in a few years while enjoying a highly flexible skill. You can work from home and choose which clients to work with. Even better, freelancing is a low cost online business to start. It’s possible to get started for $100 to $200 in your first year and only invest more as your business grows.
1.1. The State of Freelancing In The United States
Millions of Americans participate in the freelance or gig economy according to 2021 data. The best freelancers are able to earn high incomes by specializing in fields that are in high demand.
- Popular Among The Educated
Freelancing is a popular choice for highly educated professionals. Just over half (51%) of American freelancers have a post-graduate degree in 2021. These highly educated professionals are increasingly finding better opportunities to earn income in a flexible way outside of the corporate world.
- High Skill Freelancers Are In Demand
Business consulting, marketing, IT and programming are some of the most popular and well-paid freelance positions today. If you are interested in growing your freelance income quickly, focus on developing these skills since clients are already willing to pay high rates.
- More Freelancers Are Earning Over $100,000
According to a 2021 article in Yahoo Finance, 1 in 5 freelancers earn over $100,000 per year. In the United States, a $100,000 personal income put you in the elite: only 16.5% of Americans earn that much income. That said, relatively few freelancers achieved a six-figure income in the first year or two in business.
1.2. The State Of International Freelancing
You don’t have to live in the US to participate in today’s freelance boom. Freelancing is rapidly becoming a popular career choice in several other countries.
- British Freelancers Are Growing
There are approximately 2.2 million freelancers in the United Kingdom according to IPSE. The top 5 freelance occupations account for 50% of all freelancers in the UK. These popular areas include the arts, managers, teachers, managers, and technology professionals.
- Australian Freelancers Are Earning Higher Incomes
Many freelancers start their businesses because they want more flexibility and autonomy. However, Australian freelancers show that high incomes are definitely possible! According to a research report commissioned by Edelman, 69% of Australian freelancers earned more than they did in traditional jobs within a year of starting their freelance business.
- Millions Are Freelancing In India
Freelancing is becoming more and more popular in India as well. The Times of India reports that many Indians turned to freelancing in 2020 due to COVID lockdowns. In some sectors, like finance, Indian freelancers are earning above average freelance incomes. The Indian freelance economy is expected to generate an additional $20-$30 billion in revenue by 2025.
1.3. Remote Work Makes Freelancing Easier
In the past, finding the time to start a freelance business held back many people from starting their business. That barrier is slowly fading away thanks to the rise of remote work. So far, about 15% of US jobs offer remote work. In certain industries, like technology, remote work is even more popular. According to an estimate from Ladders, 25% of all professional jobs in the US will be remote by the end of 2022.
In practical terms, a full-time remote job makes it much easier to start or grow a freelance business on the side. Instead of spending 5-10 hours commuting to work each week, you could spend some or all of that saved time building a freelance business on the side! Running your freelance business while you still have a full-time job is one of the best ways to reduce risk as you build your freelance business expertise.
2. Cash Flow and Payment Challenges Are Hurting Freelancers
Running a freelance business offers a lot of benefits. However, there are also downsides. It can be difficult to get paid as a freelancer after you send your invoice to clients. A few of the top financial challenges for clients include:
- Irregular payments
In a salaried position, it’s easy to predict when you will get paid. Many companies pay staff every two weeks which makes it very easy to plan your finances. Freelancers are in a different situation. You may send out several invoices this month and then have to wait weeks for the payment to come through. When fewer payments come in, you may have to use your savings or credit to keep paying your bills.
- Late payments
Failing to receive payments on time is another common pain point for freelancers. You might be counting on receiving your freelance income by the end of the month. Then, all of a sudden, a client tells you that their finance team is having some problems and will not send the payment on time. You can probably handle one delay but if these delays become more common, your freelance life will become much more stressful.
- High processing fees
Paying a large fee simply to receive your income is incredibly frustrating. High fees show up in several ways. Some payment methods like wire transfers impose a cost on the sender and another cost on the recipient. In other cases, payment methods are slow and time consuming to work with like receiving a check in the mail.
- Meeting tax requirements
Fulfilling your tax requirements like sales tax and income tax is another responsibility of freelancers. As a 9-5 employee, your employer typically handles all of your tax obligations. As a freelancer, it is up to you to correctly determine how much tax to collect, hold that money and make your tax payments on time.
All of these challenges take time and expense to address. There are solutions that can ease the financial pressure on your business though!
3. PeachPay’s Solution For Freelancers
PeachPay’s payment solution is a great choice for freelance business owners for five reasons.
3.1. Get Paid Easily With A PayMe Page
When you first get started as a freelancer, getting paid the first time is exciting! Some freelancers aren’t sure how to make payments simple for their clients. That’s where the PeachPay PayMe Page comes in.
In just a few minutes, you can set up a PayMe page. Once it is set up, you can simply email the link to your clients. They just need to visit this page and enter their payment details whenever they need to pay you. No need to call a bank, write a check, or waste time with other complex payment systems.
3.2. Enhance Your Credibility With A Branded Payment Page
To see the value of a branded payment page, put yourself in your client’s shoes for a moment. You’ve discovered a great freelancer, and they are helping you to achieve your business goals.
Now you receive their invoice, and it includes a link to a service you haven’t encountered before – PeachPay. If you’ve had a stressful day, you might not understand what to do with PeachPay if it is unclear how it relates to your freelancer. As a result, the client may put off paying their invoice until they can figure out what to do.
Adding your branding to the payment page is a powerful way to prevent client confusion. With a branded payment page, the client will see your name and logo on the payment page. They will instantly understand that this payment page is specific to your business. Therefore, your clients will feel more comfortable making payments.
3.3. Earn More From Your Social Media Accounts
As a freelancer, social media can be a great source of new business opportunities. For example, you might have many followers on Instagram or Twitter. What if you get into a conversation with a potential client on social media? They might be excited to work with you.
With PeachPay, you can easily add a payment link to your social media profiles. That means clients can quickly pay you for your services. It will be easier to close more clients by simplifying your sales process.
3.4. No integration or technical set up required
Some payment methods require a lot of setup. For example, getting paid by wire transfer usually involves providing sensitive bank details to your client. In addition, some digital payment systems are complicated to set up.
PeachPay is different. It is designed to be simple and easy to use. Most PeachPay users are able to set up their account in minutes. There are no complicated settings to worry about. You simply enter a few details, get your payment link and send the payment page to your clients.
3.5. Send Digital Invoices To Clients
PeachPay is more than a way to receive payments from your clients. It is also a powerful invoice tool. If you’re not sure which type of invoice to send to your clients, see our guide to the most common invoices: 10 Invoice Types Freelancers & Small Businesses Should Know About.
3.5.1. Save time with PeachPay’s invoice template
Are you new to sending invoices to clients? Don’t worry – just use PeachPay’s free invoice template. It’s plug and play: fill in the blank fields and send it off to your client.
3.5.2. Split the transaction fee with your clients
When you receive payments through PayPal, there is a small transaction fee to pay. For example, a $500 payment might have a $15-$20 payment fee. The exact amount depends on whether you use Stripe or PayPal. With PeachPay, you have options. You can choose to split the transaction fee with your client or ask clients to pay the entire transaction fee.
3.5.3. Send payment reminders to clients
Your clients are people too! They might have the best intentions to pay your invoice immediately but suddenly life gets in the way. PeachPay is here to help with this challenge. Use the payment reminders feature to politely encourage your clients to pay their bills.
When you start to use PeachPay to pay your invoices, your business will start to change in a few ways. First, you’ll take far less time to issue invoices. Second, your cash flow will start to improve.
Instead of waiting weeks for payments to come through, you can get paid in hours or days! When you start to see payments come in regularly, you’ll start to feel more satisfied with your business. That means you’ll feel far more motivated to keep working on your business and earn more money!
4. The Top Recommended Payment Methods For US Freelancers
As your business grows, you will probably come across a wide variety of payments. Some clients will have a corporate policy that dictates which payment method they use. Other clients, especially smaller companies, may be more flexible and use whichever payment method you prefer.
To help you navigate through the payment options, we’ve summarized the pros and cons of the most common payment methods for US-based freelancers. To add resilience to your business, get familiar with two or three payment methods so that you can easily work with many different clients.
|Check||High security: paper is unhackable!|
Low cost: most banks charge no fees (or very low) fees to deposit checks.
Some banks have added digital check deposit features so you can deposit a check from your smartphone.
|Slow: it can take a week or longer for a check to arrive in the mail.|
Potential for loss: if you’re busy or under stress, it is easy to lose a check.
Time consuming: it is difficult for freelancers to automate check processing. Instead, you have to manually record the check payment in your financial system.
|Bank Transfer (also known as ACH)||Familiar: most larger companies have established processes to make this type of payment so there is no learning curve.|
Low cost: there are usually no fees charged to receive a bank transfer.
|Domestic focus: bank transfers are most common for domestic transfers. If you have clients in other countries, bank transfer payments may be difficult.|
Security concerns: it is typically necessary to provide sensitive details like bank account numbers to accept a bank transfer.
|Stripe||Digital payment method: Stripe is one of the most popular digital payments for online purchases. Many people are familiar with Stripe.|
Supports credit cards: your clients may want the option to pay you by credit card and Stripe supports this option.
Stripe analytics: Stripe offers reports and analytics that make it easy to track the payments you receive over time.
|No invoice support: Stripe does not include the option to create and send invoices. Therefore, Stripe is not a full solution for freelancers.|
|PayPal||Long established digital payment platform: PayPal is one of the first and best known payment systems on the Internet. Many people are comfortable making PayPal purchases.|
PayPal protection: PayPal offers protection for buyers. This capability can put a client at ease when they first start to work with you.
|Limited customer service: some users report that it is difficult to reach customer service in the event of a problem.|
|PeachPay||Earn more money: PeachPay gives you the option to pass the transaction fee to your clients. That means you can end up with more money in your account!|
Issue invoices: PeachPay has invoice templates so you can create and send invoices.
Branded payment page: PeachPay gives you the option to create a branded payment page so you can make a positive impression on clients.
|Learning Curve: PeachPay is less well known than some other payment options. As a result, your clients may have a small learning curve when they first use the service.|
As a freelancer, you might have a preferred payment method like PeachPay. However, it is critical to remain flexible when working with clients. If a client’s preferred payment method is time-consuming or expensive, you may want to consider adding a surcharge to the client’s invoice.
5. The Future Is Bright For Freelancers
Over the past few years, millions of businesses have had to become more flexible. That’s the positive legacy of the pandemic. There is now far more acceptance of remote work. In addition, several countries including the United States, are currently struggling with a significant labor shortage. USA Today recently reported that the US unemployment rate has fallen to 3.6%. In addition, the professional and business services areas are adding jobs at a fast rate. That’s good news for freelancers.
The new age of flexibility represents a golden age for freelancers. Add PeachPay to your business and make it easy for clients to pay you. To get started with PeachPay, click here.