Self-Employment: How it Works (or Doesn't!)

(awesome print by Popcorny, we have this on our wall!)

Right, so this post is kind of an extension of my 'Self-Employment Update: Six Months in' post from last week. It's most likely only going to interest people who feel they might like to be self-employed/free-lance, but you never know! I, for one, am always intrigued to hear about other peoples' lives, even if they aren't doing something I'm directly interested in doing myself (which is probably why I love Tilly's 'A Day in the Life Of' series of posts as much as I do; I seriously think they are some of the best stuff on the internets!).

So please believe when I say that I'm writing this post very far from the perspective of an 'expert' at self-employment, or as someone who is even doing it very successfully. But I do think that sharing some of my experiences and thoughts on this subject will be useful to someone considering venturing into creative self-employment specifically, and perhaps some other kind of self-employment or free-lancedom more generally.

Our Situation

I think it is important to explain that both myself AND Pat (Mr So Zo) became self-employed around the same time last year. Therefore our experience might be very different from someone who has a salaried partner/financial dependents/is single. I bring in income from a variety of sources (see last post) but Pat is a writer who works with one single publisher.

How it Works (or Doesn't!) Financially

It may be considered vulgar (like as a hangover from the 50's or something!) to discussed finances, but I can't really give a thorough picture of life as a self-employed person/couple without addressing the subject. Obvs I'm not going to go into figures, but here's how the income arrives:

Me:

• Most of my income presently comes from teaching sewing and pattern cutting classes. I don't teach regularly, my schedule is mixed. A few weeks could go by with no classes, or I could find myself teaching three or even four times a week. I invoice Sew Over It for my teaching every week or two weeks worth of work. I use eventbrite to organise my profits from classes I organise and teach at Super+Super HQ. 
• A few days after each Brighton Craftaganza event I organise I pay any outstanding invoices and calculate the profit I've made. These bursts of income are obviously as regular as the events themselves. Plus, the amount I end up with has a lot of variables, the main one being whether it was a one-day or two-day event (not as simple as two days being double the profit!). The profit I get from organising these events may be quite little compared to the amount of hours I put in, but the amount always makes that month a bit easier!
• I get a small amount of income from the selected sponsors of this blog. 

Pat:

• Pat completes a title approx. every six weeks/two months. When he finishes a title he can invoice for an advance. 'An advance' sounds very impressive, but isn't really unless you are Stephen King or something. Presently it compares to about one month's wages from his old shitty job in telesales. 
• Occasionally he is asked to do a small amount of work for other titles, like writing the introduction or something. This will be for a small one-off amount. 
• The books then take a whole bunch of months to be released. The ones he wrote all the copy for will then earn him royalties after the advance has been recouped. Obviously depending on how popular the title becomes but also how the book distributors have been dealt with, the monthly royalty cheques could be the equivalent of several month's worth of of shitty telesales wages or a small fraction of it!

As you can imagine (or maybe relate to), it can be difficult when we are both having 'lean' months. But when either of us are having a flush time, I employ a very important technique: squirrelling. As you may imagine from the name I have given it, squirrelling involves taking chunks of money to distribute into other (less accessible) places for the future. When I was a waitress getting paid in cash at the end of the week and receiving my tips in coins at the end of each shift, I literally had a multitude of envelopes, boxes and drawers to squirrel money away in. These days I have four active bank accounts for the purposes of squirrelling. It makes me feel secure knowing there are a few 'pads' of money around, even if I've been allocating some of it for a holiday or something. 

But there has been some scary patches since we became self-employed. Plus if your partner is going through a lean period, the urge can be to step up your own earnings, but that isn't always possible and can lead to extra stress. Likewise, knowing your own contribution is way down can make you feel guilty and stressed in a different way! Sometimes it feels like you really can't win. But when you do have a good month, knowing that your creativity and skills are solely responsible for that makes it all the sweeter and more exhilarating. As scary as it can be not knowing if your bills will be covered next month and as messed up as my sleep pattern can get because of it, NOT having the safety net of a dollop of a set salary to expect at the end of the month makes me feel much more alive, and somehow more adult. I feel like I'm participating in life more somehow. 

In My Experience... /Points to Consider 

There are some other points to make and lessons I've learnt over the last six months that I'd like to mention that could be relevant if you are trying to decide whether or not to quit your day job:

• Pat and I comparatively don't have much in the way of overheads, no loan repayments or credit cards to pay off. We don't have a car to run or keep taxed and insured. 
• Pat works entirely from home or a local cafe with good wifi, therefore his transportation costs are zilch. My work locations are more mixed. I work from home or Super+Super which is in walking distance. When I work in London the classes are always at weekends or in the evenings so my train fares (which can be extortionate in the UK) are always off-peak fares so I don't have to work for very long before I've recouped that outlay. 
• Recently we moved into a bigger (and therefore more costly) flat, even though we have chosen to live in one of the most expensive areas of one of the most expensive countries you could pick to live in! We made that decision because, seeing as both of us work from home at least some of the time, it was going to be better for our mental health to have some more space. Our new place has a little separate room that is now my sewing studio. To afford and justify this I no longer have a desk space at Super+Super HQ, which was a hard decision to make because I love those peops so much. But I found I wasn't using that desk space as often as I could've and it was being used in part as very expensive storage for my sewing patterns and laptop! Nowadays we can work in effectively the same room but he's at the other end so my sewing machine and swearing don't disturb his concentration as much as they used to! Plus our living room and bedroom aren't filled with bags of fabric constantly in sight like the last flat we lived in had become. 
• Going back to finances, although this of course makes sense anyway, being self-employed makes it particularly essential to have a clear idea of how much is in your bank account/s at all times! You have to either keep in your mind (which I am good at) or check regularly (which Pat has taught himself to do) what work you've completed, who you've invoiced and when you can expect to get paid. 
• Similarly, you need to keep a eye on when big outlays are looming. Whether that's something big and scary like your self-assessment tax bill, or a bi-annual utility bill, or something fun like a holiday or trip to visit friends you've planned. It helps you assess exactly how flush or lean things currently are and theoretically helps you get prepared. 
• Keeping an eye on how much work is coming up in the near to mid-future is a good idea too. If I know I've got a whole bunch of classes coming up for example, can help me decide whether or not I need to release some squirrelled away funds in the meantime or not.  
• This may be controversial, but unless you're running a business that relies on a long term business plan for momentum, I would suggest not to stress or even bother thinking about anything say, six to nine months or more into the future. Crazy I know but I think it just a waste of time. If there is anything that life taught me last year is that it can catch you off guard and throw up all kinds of potholes, but also exciting opportunities. Plus you'll naturally do some evaluating at regular intervals, so why bother to plan deep into the future when it may become clear that one element isn't working or you want/need to change tack from the path you'd previously set yourself on?
• There are HEAPS of awesome resources out there to help a self-employed person, be they of the crafty persuasion or not! Red Velvet has a lovely, inspiration e-course for carving out your dream creative job. The Design Trust is a killer website for aspiring self-employed designers/designer-makers, I well recommend signing up to their newsletter. Anyone who works from home could find support, advice and inspiration from this site, following the site author @judyheminsley on twitter is a good idea.