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Becoming A Successful Design Freelancer

Lesson 11 of 15

Types of Engagements for Freelancers


Becoming A Successful Design Freelancer

Lesson 11 of 15

Types of Engagements for Freelancers


Lesson Info

Types of Engagements for Freelancers

Okay. What's the difference? Uh, what is the difference? Ow! To 10 99 and hard won. Do you guys know the difference? Okay, so I think a W two comes from a company in the way they file their taxes. So you you're taking tax money out? Maybe with the W two. Because you're working for a company in a 10 99 years self employed on your own, you have to pay taxes. Totally. Yes. Exactly. Yeah, but a 10 99 is also going to come from the company that you worked for. Okay, So you sold your services. Yeah, but as a 10 99 you are interacting with the company as another company, potentially or an individual. But but But you're right about the taxes part. So And is that the taxes? Is the big defining? Yeah, that. Yeah. So we're gonna where I'm gonna go a little deeper on the taxes on the next slide. S o W 2 99 Right. So w two means you're an employee of the company. You could be a temporary employee of the company, which is likely if you're consulting or freelancing. But you are an employee, right? A...

nd the 10 99 means you're an independent contractor or you're self employed. Now pay for the W to your pay is equivalent to your hourly rate. Let's save you've done. It has not really rate right. Your hourly rate times the number of hours worked minus the taxes. That's what your pay is. So the point is, as an employee of the company working via W to your taxes will be taken out with a 10 99. Your pay equals your hourly rate times the number of hours worked or the project fee. So you are responsible for your taxes, right? So sometimes when I've been, uh, onboard it as a vendor or a zone employees as a temporary employees, you know, the people who are in a chart or doing the paperwork, you know, they'll just ask, like, Are you w two or 10 99? And I have a mental block on, Like after I tell you this, I'm gonna instantly forget um and, um and yeah, so the important thing to know is the 10 99 is where you are responsible for your taxes. Um, and the W two is when you're an employee of the company so right taxes will be taken out. Or you have to pay your quarterly taxes and also has a W two employees. You might be eligible for some company benefits or partial benefits. Instagram was one of my clients, and, um, I worked with them by a W two and then I actually could contribute to a 401 k Um, and that was like available to me as a payroll deduction. Eso There might be some partial benefits that could be associated with the W two with the 99 no benefits, right? You're a business. All the benefits and the taxes and all the business side of the business is that you're expected to handle that via your business. So you're not getting the benefits of the individual and the quarterly taxes air really important. So I want to go one level deeper without with you guys 10 99 independent contractor, self employed. You're getting all the cash for the project, but but it's for 10 99 jobs only. You are responsible for the full amount of your payroll. Taxes and payroll taxes are things like federal tax state tax, Social Security and Medicare. When you're a W two employees and your taxes are taken out, your employer actually pays a portion of the payroll taxes on your behalf. So as a W two employees, you're paying slightly less tax than if you were 10 than if you were a 10 99. Um uh uh, project if you established a 10 99 relationship. And so now that doesn't sound that good, right? Like, Oh, wait, I thought I was gonna make more money if I didn't work for the company. And I work for myself. But as a self employed person, you can actually write off a portion of your taxes. You can write off a portion of your expenses as associated with your business, right? And so the costs are going to kind of offset each other. But you should definitely like look at your payroll stubs, understand your taxes, do a little math for yourself and figure out which which one of these things is right for you. Um, if you, um, are self employed, you have to pay these quarterly taxes on. And if you don't pay them, there are penalties. Associate ID with with not paying his taxes, and you would pay them four times a year. So for key one right, January 1st to March 31st you're gonna pay your quarterly taxes on the 15th of the subsequent month. Right? So this would happen four times a year. Just extrapolated out the calendar. Um, yes. Do your own tax research. I am not a tax expert, but I only because snow that you that you would need to pay quarterly taxes, cool hourly rate or project rate. Hmm. Which one should I dio? Anybody have any experience in that? Yeah. Yeah, I found that hourly. Seems to work a little bit better for myself. And for my client is, I guess because I'm getting started. And sometimes I don't know exactly how long things we think. And, um, many of my clients don't know exactly how long things will dio. So the times where I've charged for a project, I kind of regretted it because things tend to take longer than you think they're gonna take. Yeah, Yeah, I think that's extremely common in definitely one of the pitfalls. And, um and, um uh, I wanted I want to talk about that, Um, in a second. But But I think that that that's extremely common. And as you as you get a little further in in this freelance world, maybe you'll have more confidence around project pricing. At a certain point, I do feel like being hourly maybe is a little bit limiting in some ways, cause e don't have the freedom, Teoh I give myself I feel like I'm stifling myself in, like giving myself enough time to think about banks. Maybe sometime, Totally. So let's go a little deeper on hourly and project so hourly. Your pay is equivalent to your hourly rate times the number of hours worked, right. The project is a fixed price for the entire project. So you know, this is gonna take me of hours and charge $50 an hour or, um, or this logo is gonna cost you $5000. And if I, like, get it done in a second or a week or a day? Um, lucky me. Right. So when you work on an hourly basis, you're usually billing weekly, semi monthly or monthly. Um, and when you build by the project, when you price by the project you're gonna build by the phase or the delivery herbal. So you're gonna get that payment up front, right? Ah, And then you're gonna say after the discovery phase, you know you're gonna pay X or when I complete the wire frames, you're gonna pay X, and you're gonna associated either with the deliverables or the phase, um, of the project. So, to your point earlier about your earning potential, So with an hourly rate, it is a potential limit to your earning potential. I think in the beginning, it's a great way to do it because you don't necessarily know how long it's gonna take you to do things. But once you establish an hourly rate with a client, it's very, very, very difficult to change it. And so, um And so because of that, your earning potential is limited by the 2000 by 70% which is like, or whatever we said so the 70% of those 2000 and hours that are available to you, right? So if you worked, if if you're back of the napkin, math was right and you worked all of those hours that you think that you have, and you multiply that by the hourly rate. So you were booked like the entire time? Um, that would be you would cap out your salary. They're right. That would be it. When you when you structure your payment based on the project, you can skill your pay to the size of the opportunity. Right. So the big, um uh, kind of story that everyone knows is that I think her name was Caroline Davies. Um, she designed the Nike logo for $35 right? So, um, I think and then I was looking up like cheap logos or something like that. And I think the Twitter logo was designed for $15. Right? So we should all be so lucky. Teoh, You know, be at the beginning of you know, that kind of exposure for our work. That's really cool. But you know, you can skill your work to the size of the opportunity. And one of the books that's in the resource Guide is the graphic Artists Guild pricing and ethical guidelines, and that talks about it. Right? You price. Based on how is this a small business and medium business or a large business, you know, logo's, you know, for a small business should cost around this logos for a medium business should cost around this and so on. Right? So you can think about you can think about that, that kind of in a different way. But you're right. You do have toe get some confidence around that because I think where you're where where you were struggling is because you, your project pricing, um, is actually too low. Right? So So you're immediately burning those hours through the hourly rate because because you're having trouble estimating the total time that you're going to spend, right? So So it's not working for you. But if you were like, Wait, this is not even a time thing like like it costs $10, to make a living. That's what it costs. That's how much I'm gonna charge for that now. And if a business wants to hire me, that's that's what they're gonna have to pay. And then you have to project manage yourself, right, Because we're all we all want our work to be perfect, and we all want to spend a lot of time doing it and and we have to know when the work is done on. And we have to start thinking about, like, the financial health of our business. Um and, um, you know, getting better at generating ideas quickly, I think, is also part of being a freelancer and kind of getting more comfortable with your craft. So, you know, you can deliver and tight timeframes and limited time frames, but you definitely don't want Teoh. Um, you know, price too low in a project pricing scenario, and then you're totally bumped. Yeah, I've seen some people charge a flat fee for projects that include a certain amount of revisions and then charge hourly in case decline ones Additional review. Do you think that's a good second model? Yeah, in my mind, that's, like pretty similar to project pricing where you're saying, um, uh I'm going to do this work for you. And, um, when you get into the, um uh the delineation of the deliverables, your you say you're gonna get three options and we're going to dio we're gonna choose one of those options, and we're going to refine that twice. Work that, um, occurs outside of how have stipulated what you're going to get. I charge an hourly rate for that. Yeah. Yeah, totally. The last thing is hourly rate. Usually no money upfront. Right? So you know, you you're on the company's, um, uh, payment schedule. And, you know, if they pay the first and 15th a month, that's when you're going to get paid. Um, with project pricing, you can build a percentage up front, and then you're setting the timeline for how you're getting paid next one on site or remote. Like OK, Everyone loves to work in their pajamas, right? Like, who doesn't have to work in their pajamas? Um, so but let's talk about that, cause I want you to really consider that because, you know, sometimes when you're talking to a client that they'll say, like, you know, are you willing to Dr Teoh Mountain View Or, um, you know, um, you know are this This project is required for you to be on site, and I want I want you guys to think about that a little bit. So on site means you work in an office. Remote means you work from home or somewhere else. Coffee shop. Whatever. Um on site usually means set hours, Right. So, you know, everyone gets here at nine o'clock and you know, we're usually done when the sun goes down, or whatever it is that they say remote means sometimes that it's set hours like Look, I expect you to be online from 9 to 6, or you're gonna You're gonna say that to your clients. I'm only available from 9 to 6 year establishing those boundaries, but it can be flexible, you know, especially if you're setting more vague timelines. Like, all have designs for you early next week. A lot of flexibility in there, you know, equipment. So when you work on site, unless it's like a super crazy, you know, start up or, um uh, maybe, ah, you know, business that doesn't have a lot of resource is, but equipment is typically provided on debts provided because there's probably some security concerns about, you know, the work that you're making and the network that it goes on and who can see it in those kinds of things. When you work remote, the equipment may be provided, but it it may not be provided it it kind of depends. Um, the equipment I always bring with me is my laptop and an external hard drive. I try to bring dangles. Those were the connectors that cable that you connect to a projector, Um, and and my power cord. I can't tell you how many times, you know, you go in a meeting room, and it's like there isn't a power cord or something like that. And you don't want your client or potential client toe have to go scramble. You know, you just want to be, like, solid prepared. You've got this.

Class Description

You need more than technical skills to make it as freelance designer. You have to know how to land projects and keep jobs over the long haul. Becoming a Successful Freelancer with Arianna Orland is your guide to managing the logistics of freelance life.

Arianna is a freelancer doing business in the saturated market of San Francisco and knows exactly what it takes to get and keep clients. In this class, she’ll cover the tips, tools, and strategies you need to have in place to be successful as a freelancer. 

This class covers:

  • Branding: Guidelines for creating a design language that’s right for you
  • Collateral: A roundup everything you need – website, business card, LinkedIn, etc.
  • Clients: Building your client list and keeping them happy
  • Finances: Keeping up on taxes and budgeting
  • Management: How to stay on top of your projects and time

Freelancing gives you the flexibility you won’t find in a 9-5, but it comes with a whole range of responsibilities. Find out how to prepare for those in Becoming a Successful Freelancer with Arianna Orland.


Will Vu

I watched the free live and can't help myself by purchasing this class. It's a valuable lesson from a humble and humorous Arianna. I love your presentation very much. Wish u the best. Thanks or bringing us this course, CreativeLive. !

Cherice Pope

Arianna gives real advice on deciding if the freelance lifestyle is right for you by describing what it's like, business skills you will need to learn, doing a gut check with yourself, how to get clients and promote yourself, and discussing a variety of experiences with other designers. She also goes in depth on differences between working at a company versus working with a company as a business. Her information is clear and wonderful. I greatly appreciate the time and effort put into making this valuable course.


Thank you Arianna for an informative course. Its heartening to know that there are other designers like me that don't come out of design school :) Your guests were a wealth of information as well, specially Peter's bulleted list.