
The Psychological Trap of Freelancing - ingve
https://www.thecut.com/2019/02/why-freelancing-creates-anxiety-about-money.html
======
josefresco
"I went outside to get coffee and ran into three different neighbors who
wanted to chit-chat. I wanted to scream, ‘For every word that comes out of
your mouth, I’m losing money!"

This is a statement from someone who either hasn't been freelancing that long,
or who hasn't realized that "brain down time" is just as important as raw
coding hours. I've worked "for myself" for almost 20 years and for the first 5
I too panicked when daytime billable hours were derailed by "distractions".
Once you push beyond that, you realize that those times away from your machine
are valuable, and actually contribute to your overall well being, and your
ability to code with a clear head, and an efficient mindset.

Wasting away "on salary" is a hard mindset to break. The answer is not to
replace 100% of your salary hours with your own freelance work. You'll find
even 50% of your previous salaried time can get just as much done, and make
just as much money (assuming you price your services and value properly)

~~~
balabaster
The biggest problem for me was my (ex)spouse always pushing for billable
hours. Every time I decided I wanted time off there was a constant nagging
reminder and guilt of not only what it would cost to go and do what I want -
for example cost of flights, accommodation, entertainment and food, but also
the cost of the loss of income for that time off meaning that every time I was
away from my keyboard it was costing me 10 times as much. There was always a
reminder to "be responsible and not lose the income" which is a toxic mindset
to be in.

These days I skip off work at every possible opportunity and to hell with
anyone who can't comprehend my lack of will to bill every waking hour,
partners and family included. I may not get paid as much, but there's so much
more to life than work. Sure, I'm not billing when I could be and sure there's
plenty enough work that I could bill 24 hours a day if I had enough energy and
will power to do that, but I don't care. My mental health and my other
passions need playtime or I'm going to flame out and never come back to this.

If you don't have a spouse that's supportive and encouraging of your need for
downtime away from work, then you're caught in a double trap.

~~~
clojurestan
Sounds like a shitty spouse

~~~
balabaster
It's easy to make a judgment on one scenario, but being unable to get out of
that mindset doesn't make her a shitty spouse, it's a fear that's been
brainwashed into her by her upbringing. She is more than her fears.

Thankfully though, I'm no longer in this position. I was rather more pointing
out a toxic mindset that you need to overcome not just in yourself but
potentially in your spouse and the rest of your families.

~~~
mistersquid
> being unable to get out of that mindset doesn't make her a shitty spouse

This is an incredibly helpful reminder that people should not be reduced to
their flaws and relationships are not the mere sum of their drawbacks.

Because people are risk-averse, it's easy to focus on what's bad and take for
granted what's good. So when a relationship becomes challenging, people can
reflexively give up (or throw away) rather than work with and get through.

Relationships are worth maintaining and building, even when they become
difficult. In some cases, relationships are worth maintaining especially when
they become difficult because the relationship becomes stronger and promotes
greater well-being to the degree that it has survived hardship.

~~~
balabaster
Indeed they are... though in this particular case there were a bunch of other
factors that caused this particular relationship to fail, but even with those
considered, they don't make her a shitty person, she is more than the sum of
her parts. Just because the relationship was unworkable, doesn't make her a
bad person or even a bad spouse, they just make us bad partners to one
another.

~~~
davidscolgan
I have the highest respect for people like you who can make comments like
these. It takes a lot of maturity and mental creativity to see things from
others' perspectives, and if everyone had your mindset the world would be a
better place. If you are ever in Chicago I'd love to buy you a coffee/beer and
hear your story.

~~~
balabaster
Thanks, if I'm ever in Chicago, I may take you up on that :)

------
photoguy112
I went from hourly, to per project, to weekly billings. When I charged hourly
I ended up working A LOT more than 9-5. Per project work was good but I ended
up losing a lot of prospects in the quote. Since many of my projects ran into
the 20-40k range, my closing rate was 1/10 (already pre-screened, what I
deemed as high quality prospects). This made me feel like crap. Instead of per
project, I decided to increase the rate, so now a project may be 30-50k+,
figure out how many weeks it may take me to complete it (rough idea, but this
is not important) and then divide into a weekly rate. What ended up happening
is me tripling my hourly rate and invoicing weekly. This was game changing for
closing leads, now my rate is probably 8/10\. You get all the benefits of
having to work a lot less but charging a lot more. I will be honest, some days
I feel like shit (who doesn't) and I don't work at all. I don't feel bad
because on the days that I feel fantastic I get into the zone and knock out a
TON of work and usually get ahead. Client sees progress weekly and they are
happy. It helps them that they don't have to pay a ton of money in 2-3
payments and can spread it over the course of months.

In terms of happiness, freelancing definitely comes in flavors. There is the
grunt work, the highly paid freelancer, the consultant and the product-based
business until you go full startup or large company. I have seen all tiers.
Currently I am a step short of having my own product while I figure out what
that will be. You definitely need business acumen and people skills to succeed
in the consultant stage. For product business you gotta go a step beyond that
and either do really well as a consultant to bootstrap, or just work your ass
off to get it going. My advice for anyone in freelancing now, who does not
have people skills and gets latched onto hourly work, you may want to
reconsider your choices. Freelancing can be highly stressful and demoralizing,
unless you take the steps to go into consulting or beyond. It's a ladder, just
like your corporate gig, you gotta do the work to move up or suffer where you
are stuck.

~~~
porker
> I went from hourly, to per project, to weekly billings

I have tried all three, read all the HN favourites on why value pricing is the
way; tried charging for roadmapping; and yet I come back to the most stressful
of day-rate (hourly by any other name), unable to break this in 15 years of
technical consulting.

Why? Because with per project billing I was losing 30-50% as client
expectations were different to mine. When I added 30-50% to the prices, I
didn't win the jobs. I could write a spec 80 pages long (which no client would
pay for) and still there were variances which cost me.

On my current $50k+ project I've got the client to bear the risk because he's
the worst client for cost overruns I've had, and it's on a time and materials
system. However because he has no more money than the top range of estimates,
and because he wants everything and more, I feel trapped and as stressed as if
it was fixed price (which it's turning out to be).

It feels like I am missing something obvious that other developers/consultants
have got. I want to price on value so I'm not stressed about every minute's
productivity. My clients want fixed price so the risk is stacked on me; they
won't/can't do sprints (often because their board of directors won't approve
it, even if they say they see the benefits); and the projects are unique
systems each time, so the estimation is not accurate.

I freelance/consult because it pays well, but this way of working sucks.

~~~
andyidsinga
> It feels like I am missing something obvious

I'm not sure if you're missing something _obvious_ ..this is HARD, I totally
know what you're feeling like.

I was talking with a buddy other day ago (also a consultant); I was grumbling
about how clients have "urgent" projects and then proceed to sit on the
project proposal for a few weeks...

His response went something like this: "look, there are reason's why
consultants are called in to work projects - and those reasons are _not_ that
they are well organized, well equipped, well funded ..etc etc". Oddly, that
made me feel a bit better.

~~~
stronglikedan
Ah, yes, the "hurry up and wait!" projects. If it makes you feel better, my
9-5 for the man is full of them too. Working all weekend to come in on Monday
and find out it was all in vein is no fun.

------
UweSchmidt
On the other hand, equating time (especially work time) with money helps with
making sense of what money is actually worth. These days every product
category is full of well presented temptations in any price range.

The correct way to evaluate a 1000$ phone, a mechanical keyboard with custom
keycaps, fantastic coffee machines and barbecues and car parts and designer
handbags is to put them in relation to "how many hours do I have to work for
this purchase".

~~~
hackathonguy
I completely agree, but would like to note a common fallacy following this
logic.

If my hourly rate is $20, I might think that a $200 phone is worth 10 hours.

The thing is, the majority of those $20 I make are probably already allocated
to things like rent, food, transportation and so on. If those things account
for 50% of my expenses, for example, the $200 phone is actually worth 20 hours
of my time. (That is, unless all my necessities are already accounted for, and
I'm working 10 hours _on top_ of what I usually work to buy the phone.)

It's important for freelancers to account for what is essentially their
"operating expenses" when making purchasing decisions.

~~~
OJFord
You could do it like that - subtract 'essentials' (for some definition) from
your hourly rate - but you don't have to.

You could also say your rent et al. are X hours, and watch you don't 'spend
more hours' than you work.

------
mundacho
My biggest mistake at the beginning of freelancing was that I sold more or
less 8 hours a day of work. That's too much because as a freelancer you do not
have vacations or paid sick days, and contract. So I corrected it to 120 hours
a month, that means that:

* I can recover sick days if needed.

* I can work a little bit extra for 1 or two months to get a 1 week vacation.

* I can use the extra hours a day to do some marketing/networking/sales.

* It's easy to take half a day off and recover it in 2 or three days.

* I needed to charge more per hour to make it work, but now I'm pretty happy with it.

(Edited: Formatting)

~~~
mgbmtl
That still seems rather high to me. I usually aim at having 3-4 billable hours
per day. The rest of the time, if I'm not slacking off, I put into improving
the product or sales.

Even for salaried workers, I don't think anyone would expect them to do actual
productive work for more than 3-4h of programming per day (rest of the time
being spent on meetings, planning, office distractions, etc).

~~~
hnick
Even in an office environment I've seen rough estimates of 5 (6 at most)
'billable' hours per day for longer term projects. The rest is admin,
housekeeping, chitchat, etc.

Studies seem to support the 4-5 hours of useful work per day over long
periods. It's easy to peak at 8+ for a short time (and twice as easy for
personal passion projects) but it wears off.

------
neokantian
Five hours of working on something you like, often feels like ten minutes
working on something you don't.

The real benefit of freelancing is that you will tend to pick work that you
actually want to do; which also means that you may indeed end up working more.

But then again, giving people more choice is not good for everybody. Some
people will simply turn their lives into a freak show.

------
atemerev
I am a freelancer, and I chose this path specifically so I could work less,
not more.

For me, money is just the road to my personal and family enjoyment. If I can’t
enjoy life while making money, what’s even the point of making it? The road to
happiness seems obvious to me: charge more (and automate income), work less,
have more free time.

~~~
furyg3
I can really echo this way of thinking. I chose this role because I knew it
was flexible (sometimes by choice, sometimes by chance), which means the
downtime is built-into the price.

I frequently (happily) take days off to be with my daughter, and can very much
enjoy the downtime when a client needs to have me out for 4-5 hours instead of
a full 8-10.

The only time this thinking creeps in is when scheduling longer vacations.
It's somehow easy to spread the cost of downtime over a day or week, but much
more difficult to spread a chunk of vacation 'downtime' over the rest of the
year. I'm actually toying with the idea of paying myself quarterly to see if I
can curb this sensation.

~~~
ThomPete
My advice is that you find a freelance assistant who is good enough to take
your directions but not necessarily able to think/do what you do.

That way you can delegate out some work while on vacation without taking too
big a hit.

------
erik998
One thing I would like to add... I created my own solo S-corp and started on
the path of contracting. I have been successful enough to minimize my payroll
taxes using a solo 401k (~18k max contribution and then my company can
contribute 25% of my w-2 salary). Now I am at the point where I am
investigating how to setup a defined benefit plan for myself to defer 75-100k
in payroll taxes. Most likely a cash balance plan.

I think most employees at FAANG don't realize how much they really give up
paying CA taxes and a significant portion of Federal taxes.

Then I realize why FAANG companies don't have defined benefit plans... The
tenure of most employees would not make it worthwhile.

I wish we had something like the SAG-AFTRA rate fees for programming. We don't
so I guess my solo way of doing things will have to do for now.

[https://www.sagaftra.org/contracts-industry-
resources](https://www.sagaftra.org/contracts-industry-resources)

Look at those rates!

~~~
erik998
Here is a good example of how you can max out a solo 401k and use a private
pension plan.

[https://www.watsoncpagroup.com/kb/Turbo-
Charged-401k-Plans_3...](https://www.watsoncpagroup.com/kb/Turbo-
Charged-401k-Plans_302.html)

The dumbest thing in the world is working at FAANG at high salary levels.
Unless your are in the C-suite you are always in a precarious position. It's
not easy to justify the high salary at a competitor all the time.

The best strategy is to get good amount of revenue via a solo S-corp and
minimize your payroll taxes. Hell your defined benefit plan can purchase all
the FAANG stock it wants. You don't want to be the Sun employee with many
stock options that are worthless in a downturn. At least you can dump your
stocks and have some flexibility in your own defined benefit plan.

~~~
hash872
> The dumbest thing in the world is working at FAANG at high salary levels.
> Unless your are in the C-suite you are always in a precarious position. It's
> not easy to justify the high salary at a competitor all the time.

I don't think you know what you're talking about. An engineer making $200k+ at
a FAANG can leave that company and.... probably make the same (or more) at
another large tech company. Their salary is determined by basic supply &
demand, if they have skills worth $200+ at one company, they'll find similar
compensation elsewhere. (If it's not easy to justify their salary at a new
company- why exactly is their current company paying them that much? Are they
running a charity or something?)

I don't understand your obsession with payroll taxes. I'm self-employed too,
everyone knows you avoid payroll or self-employment taxes by setting up an S
Corp and paying yourself disbursements on top of a salary. Anyways, for an
employee they're really not extremely high, so I don't understand building a
whole strategy just to avoid this 6% tax. Being a FAANG employee comes with a
ton of non-cash benefits & perks- the 401k match alone is probably double
whatever you're losing in payroll taxes. The value of the health insurance is
probably more than payroll taxes.... Sounds like you're not really properly
accounting for any of this

~~~
erik998
It's not 6%. Im not talking about the employer's portion of social security
taxes.

Go to
[http://www.esmartpaycheck.com/FreeCalculator/](http://www.esmartpaycheck.com/FreeCalculator/)
Change cycle to annually (2019) and in column cp put in 250k.

the taxes I am talking about are: Federal Income Tax Withheld $61,363.50 State
Income Tax Withheld (CA) $22,103.55

That's where you can make a substantial amount of savings by diverting that
into a solo 401k and defined benefit plan. You need to pay taxes but you can
knock that down quite a bit.

So from 250k down to 150k is your take home... imagine you can structure your
business to save a substantial amount of that.

Health insurance ... ehh yea can be expensive but you can use an HSA and high
deductible plan... That's why keeping obamacare laws are helpful. As long as
you can get bumped off for pre-existing you are ok.

Screw the non cash benefits... Im sure many Sun and IBM employees enjoyed
those same perks too. No FAANG company has a 25% match policy, they usually
have 3% or some small matching percentage across the board for their 401k safe
harbor provision... The same match for all employees.

People are catching on and making these calculations... Sure moving around
FAANG companies might seem easy but just because company A pays you X doesn't
mean company B will pay X+Z... It may seem like it in the hype but ask any
former Sun employee making X why they can't find X+Z.

Options... that's where you might get real lucky. You got me there. That's
something I am still learning about... But in your defined benefit plan you
can just buy a basket of FAANG stocks.

Take a look at [https://watsoncpagroup.com/kb/turbo-
charged-401k-plans_302.h...](https://watsoncpagroup.com/kb/turbo-
charged-401k-plans_302.html)

~~~
hash872
> Federal Income Tax Withheld $61,363.50 State Income Tax Withheld (CA)
> $22,103.55

I think there's some confusion around terminology- that's not payroll taxes
(the 6%), that's regular income taxes. Anyways, you realize you do have to pay
taxes eventually on your deferred income, right? I agree they will probably be
lower rates, but you're not 'saving' yourself from these income taxes, just
deferring for a few years....

Health insurance costs $6k+ for a not-great plan with a kinda high deductible
(source- this is what I have). The type of HS offered by a FAANG is ultra-
premium, literally everything is covered. There is so much financial value
there man, especially if you have a medical emergency and actually use it- not
to mention that they cover your family too. Minimum value is $10-20k and could
be way, way, way higher depending on your usage or your family's usage in a
given year.

Yes, FAANGs will match 401ks 10% or above (!). 3% would be poor in any
industry or sector. Your information is incorrect.

Not interested in arguing with you about FAANG salaries, you're simply wrong.
If you're worth $200-300k at one of them, you're extremely in-demand and worth
that at a lot of companies.

I want to argue respectfully, but you have some awful weird financial ideas
just based around tax avoidance (which is really just tax deferment). There is
absolutely no way the tax benefits of contracting with a defined benefit plan
even come close to the $ amount of the benefits from working at a FAANG,
you're not even in the ballpark. More proof that taxes just make some people
crazy and lead some to absolutely bizarre financial decisions (like people who
commit tax fraud and go to real prison- the risk/reward there is completely
out of whack)

------
puranjay
My sanity and income both improved remarkably once I stopped trading hours for
money. Now I trade results for money.

This gives me a lot of control over how I work. The client only cares about
the result - X% increase in website traffic, X new leads, etc.

As long as I make that happen, it doesn't matter to the client whether I work
5 hours or 50.

I'm often done with my month's work in about 10-15 days and have enough
downtime to focus on side projects.

~~~
RickS
How do you bring up the topic & structure rates? EG, if you get 80% of the way
towards that 5% goal, What about 120%? etc.

How do you price based on results like this without a clear internal view of
the company's numbers. Feels like it would be throwing darts somewhat.

------
demircancelebi
After freelancing for a few years, I decided that it was not making me
happier, since:

\- It is not possible to create significant wealth by freelancing

\- I work on things I do not care. I want to think/spend time on important
things

\- Chasing down payments is stressful

\- Finding new clients requires some effort

Therefore, I decided that it would be much healthier for me to get a job that
pays well and not work as a freelancer.

~~~
pault
Have you considered going hourly with a staffing agency? A senior developer
can charge a three figure hourly rate and if you aren't known in the industry
an agency can place you at companies that can afford to keep you working full
time. I've always gone above and beyond at my salaried jobs because I find the
work gratifying, and I've been thrilled being able to charge for those extra
hours. I doubled my yearly income when I started contracting. Providing your
own benefits can be stressful and cost more when your employer isn't
subsidizing it, but if you are making over $200k/year medical insurance is a
relatively minor expense.

~~~
demircancelebi
Right now, I'm thinking about applying to the largest companies of our
industry in a few weeks, but can you please briefly share your experience on
staffing agencies, because making $200k/year without an office sounds
appealing.

~~~
pault
I haven't worked at home since I started contracting (after a 10 year stretch
of all remote work). In my experience most jobs that you get through a
staffing agency are for big lumbering corporations that are completely out of
touch with the industry and think that all employees are thieves and villains
that must be supervised at all times. These companies are also the ones that
have enormous budgets for contractors (for accounting reasons, I guess) and
very little oversight (institutional inertia can keep you on a contract for
much longer than it takes to finish a project, and projects take significantly
longer than they should because of all the above factors). I've been fortunate
that I'm mostly working on projects where I'm the sole front end developer and
I get to dictate all of the technology decisions, and building something from
the ground up is very gratifying, even if you have to work in a soul sucking
office park in the middle of the suburbs.

------
momirlan
I have been a freelancer for 24 years, and had this problem. Here's how I
solved it. I incorporated my business, and I am an employee. My corporation
pays me a stable amount, so I'm not worried. When I put the business hat on, I
make sure I project the yearly income and have a generous salary fund ( 6
months). No worries anymore, the most I have been without work has been
3months. If at the of the year I haven't spent my salary fund, i have extra
money. Another truth one must acknowledge is that its not about how much you
make , its how much you spend. When you have financial discipline the mind is
free.

~~~
sovietmudkipz
That sounds interesting. What are the tax implications of such a setup?

~~~
momirlan
It's a common setup in Canada. I paid corporation tax once for money left over
in the company account, but that is just cost of doing business for me. Once I
have the 6 months of salaries, I just roll it over year over year with no more
tax to pay. Salary is taxed as regular income.

------
davidscolgan
The best way to freelance that I know of for stability, low stress, and
freedom is to get a regular ~10 hour a week gig doing remote contract
development. Change $100/hr+. No hustling really required after you find them
since in my experience they want you to stay on for the long haul.

There are a lot of very small companies with less than 10 people in them
quietly making good money that have a software system that doesn't need a full
time developer. Or, because they can't afford a large team, are willing to
hire a few developers part time to reduce the risk of one single person being
the sole linchpin for the entire business.

I see a lot of people around here asking "How do I get more clients?" In the
course of 8 years of freelancing, I've only had around 10 clients total
because most of them have been in an arrangement like this, and they stay for
a long time. I've often been the one to end the relationship for it not being
a good fit for me, not them running out of money or firing me. They don't come
very often, but when they do, they usually stick.

If I had to do the Upwork hustle, I'd have probably quit a long time ago. This
seems to not be as true for other professions like
design/copywriting/music/etc, but full time salaried development just pays too
well to be a freelancer unless you want freedom. Otherwise it's just crappy
employment with fewer benefits.

For a good number of years I lived in rural Indiana and worked 10 hours a week
for one client at $90/hr and made plenty to live on for just myself. Now I'm
working to earn more than that, but with this model it's often a matter of
scaling up or down the number of clients you have.

Freelancing gives you the ability to work less than 40 hours a week, which
gives you leverage over your time to create the life for yourself that you
want. It's stupidly hard to start a SaaS app with a full time job, but
freelancing can sustain you on 20 hours a week and then the rest of the time
can be spend doing whatever you want (just work less, start a business without
stress, travel, etc).

------
gdubs
“If we’re already in the time-is-money mindset, we can reframe our leisure
time as something that enables us to be more productive in the future,”

It’s a bummer that we’ve gotten to a point that in order to relax and enjoy
time off we need to somehow frame it as “productive”. I think it speaks to
something deeper.

~~~
davidscolgan
This mindset is so hard to get away from. Still working on it myself as a
freelancer of 8 years. I'm starting to think that happiness, work/life
balance, and relaxation are all basically a mindset shift that has to be
consciously taken.

As my friend recently said, "When I work, I'm typing text into a text box.
When I play, I'm also typing text into a text box. What's the difference?"

------
mpweiher
My approach so far is to:

(a) charge a high rate

(b) preferably charge for projects or

(c) definitely only charge at full day granularity

(d) leave some slack in the accounting, favouring the client

The thing is that the client is not really paying you for your time, they are
paying you for the value you can deliver. Time is a very rough analog, but so
far seems the best that we can do and actually agree to.

So the above leaves the time-based accounting in place, but de-emphasises it
as much as possible.

~~~
rvwaveren
I do roughly the same, and besides charging a high rate, I usually do only one
project at the time for 2 - 6 months. With my clients I make a deal about my
daily rate * number of days per week I will be working. I never charge more
than that, except when I do a lot more work and then I communicate it in
advance (or I foresee that the extra work is going over the amount of hours we
agreed upon).

This is not applicable to every freelance job off course, but if you have the
luxury of being able to charge a higher rate, you can make a decent living and
enjoy your free time.

For years I was employed and worked 40-50 or more hours per week. I was
devastating for my work/life balance, effectiveness at work and my happiness.
Since I started freelancing a year and a half ago, I'm happier, work less and
earn more. I spend more time with my kids and I am really (also mentally)
present. I'm also in better shape (training for a marathon currently), and I'm
more effective at work.

~~~
rdokelly
Would you guys mind speaking a little on your path from salary to freelance? I
want to make the jump but it seems scary and I don't really have anyone to
talk to about it? How are you guys finding work?

~~~
vitaflo
First step, don't call yourself a freelancer, cuz you don't work for free. The
word has connotations of "temp". A freelancer is someone you bring in for a 3
week stint. A contractor or consultant is someone you bring in for a longer
project. It doesn't matter that these are all basically the same person, but
perception matters.

Always make the relationship a business to business one. Don't get stuck being
the "hired hand". Just doing the job isn't enough, always provide more value,
get involved in their biz if you can. Don't work from home, work on site, "out
of sight out of mind" is a thing, and is the fastest way for a client to see
you as expendable.

The best way to find work is to build a network. The best way to build a
network is to get a gig with a bunch of other contractors at it. Then work
hard, and be pleasant to work with. Once that gig dries up, and all those
other contractors go out to find new gigs, if they liked you, they'll
recommend you for openings at another client. Rinse and repeat.

I got very lucky in that my first contract was a 6 month contract on a team of
15 other contractors (at a F500 company). That 6 months turned into a year and
when the money ran out, I had a network of 15 other people to lean on. Since
then I've never had to look for a gig, they've all come to me.

------
andy_adams
It cuts both ways. As the author says, if you allow yourself to worry about
every minute not working, you'll be mentally drained in no time.

On the flip side: Having my time tied to an hourly (actually daily) rate has
saved me countless hours chasing things that weren't worth my time. Things
like waiting in line for deals on electronics, or spending 5 mins driving
around to find the cheapest gas or place to eat. 5 mins @ $100/hour is $8.33,
far more than I'd save by spending time on it.

Even at $10/hour, the time I used to spend trying to save a buck was pretty
wasteful.

------
endofcapital
The whole reason I got into freelancing was to take 3-6 months off a year.
Lighten up people, you're gonna be dead soon and absolutely nobody is going to
care about how many times you committed to github.

------
ddebernardy
The problem described by the OP largely goes away when you stop charging by
the hour.

~~~
JackPoach
Exactly. All you need to do is charge on 'per project basis'. But it's fare to
say that not all freelancer can do this. There isn't really such thing as a
'freelancer'. A coder, a writer, a designer, a virtual assistant - these are
entirely different lines of work.

~~~
andysinclair
It is better if you can charge on a 'per project basis' but only if you have
spent time up front working on an accurate estimate and, more importantly,
built in significant contingency into your price.

Often though this up front time working on an estimate can end up being for
free, an opportunity cost really, if you don't win the project.

~~~
seanwilson
> Often though this up front time working on an estimate can end up being for
> free, an opportunity cost really, if you don't win the project.

Charge for a discovery phase. Your requirements gathering skills and planning
for what to build have very significant value.

------
pointillistic
I am a "freelancer". I have discovered that billing by the hour is the worst
idea. It creates the inherent conflict. Clients start resenting how much time
it took you, etc. Instead always bill per job, unless impossible to estimate.
Determine value acceptable to you and the client. Agree on lump sum and let
chip fall where they may. Sometimes client wins, sometimes you win, in the end
it all events out. More importantly you build a base for the next job where
everyone agrees to acceptable fixed fee parameters and you can correct the fee
estimate. Hourly billing is really wrong in my opinion.

~~~
Spooky23
Fixed fee is great as long as the scope is limited.

Whenever I've hired companies to do stuff on a fixed fee basis, they typically
lose due to unforseen circumstances.

~~~
icoder
One of my clients said the other day: "When working with a fixed fee there's
always 1 party that 'loses'". I tend to agree, either it ends up more work
than expected (freelancer loses), or (although in your experience that's less
common) the freelancer learned from previous mistakes and overcharges.

In addition, the upfront cost of specifying the job is also lost. This is not
always trivial to 0do upfront, as both the world, insights, etc change over
time (hence many have moved away from the waterfall approach).

~~~
Spooky23
The biggest thing is that flat rate doesn’t do is anticipate risk. If through
nobody’s ill intent a task takes 5x longer or 5x less, it’s all swallowed up
by the flat rate.

That’s a feature for a productized service.

It also works for well-scoped tasks. I wouldn’t pay someone by the hour to cut
the grass.

~~~
pointillistic
On assumes that there is always room for additional services. And unforeseen
conditions.

------
rburhum
When I was freelancing a bit over a decade ago I was making more than most
people my age I knew at the time. My natural reaction was to try scale that,
so I hired folks to do the work _for_ and _with_ me... that is when I learned
first hand how difficult it is to scale a services-based business.

However, folks much smarter than me taught me another thing. True wealth is
created when you reach a point where you are making money while you are
sleeping - which is exactly the _opposite_ of what I was stressing about ("I
only make money when I am charging for my time"). Ironic.

~~~
mistrial9
"True wealth" has many meanings in life, not only finance. When you substitute
all of life for finance, its a trap.

~~~
rburhum
Of course if you see it in a macro sense you are right. My comment was within
the context of this article:

My point was that [Time worked == money generation] is exactly the opposite
way of looking at things.

~~~
swagasaurus-rex
This is something multiple clients of mine have told me.

They were straight up about letting me know, hiring me is great for them
because they can make a crap ton of income once the product is completed.

That's the nature of things though. You make money the most money by owning
things that make money.

------
k__
For me it is exactly the opposit.

I started freelancing, because I wanted freedom over my time.

While I probably undercharged by a huge margin in the beginning, at least I
only worked when, where and how much I wanted.

I still made 20% more than with my last employment job, so I didn't really
notice.

------
danielovichdk
You can't set a price tag on your time, it's way to valuable in the sense of
you can't buy it back.

Spent your time wisely. You are going to die, and if you spent most of your
prime time speculating in making more money, you never understood life.

------
SpaceInvader
I'm on salary, but I do feel similar pressure as well. Even though I'm being
paid more than decently I'm still looking for additional gigs, but what is
hardest on me is the feeling that I'm loosing time and a lot of money if I do
not manage my side projects everyday and I do not grow constantly even though
my main side thing is not designed to bring me any money I feel really bad
when I'm slacking.

------
andyidsinga
For those of us out there doing consulting work and charging hourly - I
encourage you to check out the Jonathan Stark podcast "Ditching Hourly"[0] and
also the "2 bobs"[1] podcast with Blair Ens and David C Baker.

Both talk extensively about pricing work on either "value" (best option) or a
fall back to pricing "outputs" (what gets delivered) ..and they try to get you
out of charging by the hour - worst case charge by "blocks of time" (ex 2 week
block of time minimum).

To be clear - getting clients out of the mindset of charging by the hour is
_extremely difficult_ ..all the back of the envelope math client will do in
their head results in an hourly value.

[0] [https://www.ditchinghourly.com/](https://www.ditchinghourly.com/)

[1] [https://2bobs.com/](https://2bobs.com/)

------
mancerayder
_As the economy moves away from traditional salaried jobs and toward contract
gigs, more and more people are starting to feel like I did. Other studies
found that billing by the hour — no matter how much people charged —
compounded the tendency to view time and money as one and the same. Those who
did so were less likely to take pleasure in leisure activities, because they
were too preoccupied by the opportunity cost of their time. Again, these
trends were similar across income levels._

Blah, blah, blah, the article continues. Look, freelancers have transparency.
FTEs get paid that paycheck twice a month, or once in some places, but when
they sign the offer letter, it never -- in the US and the UK -- really matters
how many hours you work. In both places, you'll simply be expected to be
suddenly put on an on-call rotation a few months after you start, you discover
that the shoddy release happens Tuesday nights from 11p to 2a, despite asking
three times in interviews, etc. In some places, you get 'PTO', which means if
you get sick, you need to cancel your vacation which comes out of the same
pool. In one place I worked, a retail brokerage with a vicious on call week,
you had 15 days of PTO, which included sick time. Got the flu? Oops, no
Caribbean vacation for you, sucker. We had to work weekends and holidays, due
to releases and on call, with no comp time.

Even more importantly, my 40 hrs is transparent as a freelancer while your
45,50+ because you want that promotion or bonus isn't paid. But you're
"passionate about technology", right? That's what you tell yourself.

That's not isolated. I have a long career of observing that, and my sucker
friends who say, it's part of the job, this that and the other.

As a freelancer I make 30 pct to 50 pct more than FTE, I KNOW they want me
there because they'd get rid of me if they didn't, and I'm hedged against 'oh
we need you to be available, that should be obvious when you joined'
entitlement.

I freelance if I can, do FT when I must.

~~~
lm28469
> your 45,50+ because you want that promotion or bonus isn't paid.

Made me think of : "The new proletarian sells his labour power in order to
consume. When he's not flogging himself to death to get promoted in the labour
hierarchy, he's being persuaded to buy himself objects to distinguish himself
in the social hierarchy."

[http://library.nothingness.org/articles/SI/en/display/31](http://library.nothingness.org/articles/SI/en/display/31)

------
aframe
My working life changed recently after leaving my last role just before
Christmas. I’ve done freelancing on and off for a few years and I just feel
like the whole process of freelancing is fragmented and broken.

I’ve started digging into the issues others are facing too, and at the expense
of getting berated for highjacking a thread, I’d be keen to hear what problems
others have in this area? I put together a little survey here:
[https://adamfarah.typeform.com/to/abznqs](https://adamfarah.typeform.com/to/abznqs)

------
baragiola
I did freelance work for about 2 years and I didn't feel at all like the
author.

To me associating time with money was helpful, but I wasn't thinking on it
24/7\. I know that when I feel tired, the most productive thing to do is have
some leisure time or simply go to sleep.

To me having a price tag on my time was helpful deciding what was worth
waiting for. Trivial things like waiting for a bus or taking taxi, cooking vs
take out, etc.

I guess it mostly depends on your priorities and how much money you make.
People living on the day or the week maybe don't have the luxury to relax

------
diehunde
I have this same issue but instead of money I feel like I'm wasting time
because I could be learning and improving my professional knowledge. I wonder
if that's also unhealthy.

------
rconti
I've always said I could never be hourly (or freelance) because I'd never take
a vacation; instead I'd just be thinking about how much money I was losing.
Same would apply if I had a work arrangement where I (say) got 3 weeks of PTO
but arranged for enough extra pay to cover a 4th week of vacation "unpaid".

I'm sure if I had enough in the bank, and was on a quasi-sabbatical or quasi-
retirement, I could view extra freelance income as the "cherry on top", but in
terms of money to pay the bills, it would be incredibly hard.

I appreciated the author's comments on paying for time saving things that make
you happier (I HATE doing the laundry, but we cook almost every day), as well
as the comment about dog walking.

I think this just means you have to find the joy in things you choose to do
with your time. For example, I once mentioned that I feel I don't find enough
time for hobbies, but a friend mentioned cooking dinner every night, working
out, and a few other things that are part of my daily "routine" as things that
I choose to do, things that are "productive", but in a way that we don't
typically give ourselves credit for. In other words, recognize how you are
spending your time, give yourself credit for the good things you do, don't
take them for granted; not everyone does those things.

------
mathattack
Attaching a dollar value to time is productive.

I do see the point though. I’m on a very inefficient board of a financially
struggling non-profit. And I keep doing the math of “If we could meet for 1
hour instead of 3, the money saved by the board would pay for the deficit.” I
squirm every time we spend thousands of dollars of time on fifty or a hundred
dollar items. So the OP does have a point that’s there’s a downside in terms
of frustration.

------
musha68k
I sucessfully have been doing this for more than seven years: the trick is
decent but fair pricing per time unit; also you have to budget and calculate a
buffer _realistically_. Yes, you also need downtime and if you are stressing
about that you are most likely billing too low or are simply too
anxious/greedy (all things that can be fixed).

Enjoy the freedom, at last that's what you have optimized for.

------
lexda15
I have the feeling as the author while I charged hourly rates. I see a
tendency that more freelancers start getting money from a fixed price for a
project. It helps to charge more and less work. Also, it is easier to get
relaxed. You know when you should finish a project.

I shared here one research about the hourly rate of freelance developers [1].
They calculated that right now, it's about $68 of the US JavaScript
freelancer. But I assume that American freelancers charge more. Perhaps, some
freelancers charge fixed prices. That's why the rate is lower.

Thinking about time equals money really disturbs your life. You have to live
for enjoying but not for getting money every minute.

As a lifehack, early I included my vacation/sick/holiday days to calculate my
hourly rate. It helps me to have planned vacations and some days to sick
without any thoughts about doing a job.

[1] [https://periodix.net/blog/which-developers-earn-more-
corpora...](https://periodix.net/blog/which-developers-earn-more-corporate-vs-
freelance/)

------
DanielBMarkham
I've been freelancing my entire life. I feel this pain.

I don't think there's much advantage in trying to sort out work vs. life time.
The problem is that by stating it this way, it always makes it into some kind
of conflict. In fact, if your job and your life are so dissimilar that the
concepts can't coexist in your mind, you have an additional problem not
related to billing.

What _might_ work is a kind of reverse budget. Decide how many hours you are
willing to bill every week/month/quarter and stick to it. You can (and should)
spend your time however you think it will help you as a person, but by
limiting the amount of time you're willing to put other people's interest
first, you sort out a lot of ethical conflicts that otherwise you might fall
into.

I know that's easier said than done, especially when you're starting out. I
remember many years of billing like a banshee.

I missed my oldest kids growing up. I regret that strategy. Like so many
things in life, some folks end up figuring it out by the time it doesn't
matter anymore.

------
jasonkester
_People who attach dollar signs to their time — or “value time like money” —
tend to be overwhelmingly less happy than those who don’t, because their
nonworking hours suddenly seem less important. “Free” time gets tainted with
guilt because there’s a cost associated with it._

Could this be a result of people not attaching a _high enough_ dollar amount
to their time?

I tend to see consulting (described as "freelancing" in the article) as
exchanging a little bit of work time for a lot of play time. It just plain
pays so much compared to a salaried gig that you can buy yourself the better
part of a _year_ of downtime with just a few months' work.

So yes, the article is right that I did sometimes think of time in terms of
money and vice versa. But usually in terms of "how many seconds would I need
to work to afford this cheeseburger", rather than the article's anxiety about
how much my vacation is costing me.

Downtime/vacation is the explicit goal of the exercise.

------
potta_coffee
I value my freedom. Freelancing, which I've done off and on, is the best
lifestyle I've experienced. I've never once felt bad about not working on my
off-time. Rather, I've noticed that while freelancing, I'm able to have so
much more quality personal time than I can have when I'm working a traditional
job.

------
Nursie
I'm a contractor, it's sometimes tempting to think this way for me too.
Particularly when it comes to vacation days.

But then you have to remember you are charging more because you need to build
this in. Maybe you can work those extra five days instead of taking a week's
vacation, but then you're going to burn out sooner.

------
toss1
Indeed, as the article describes, it's not so much the stress of freelancing
as the particular stress of billing by the hour.

While I/my shop nominally have billable hour rates, some time ago it evolved
into projects that are estimated as the rate of billable hours plus materials,
but billed on a per-project basis. The project is due for the agreed amount,
whether I spend the planned number of hours, twice that, or half that.

This is decidedly less stressful for both me and the client.

I still have the stress of meeting the schedule deadlines, but I no longer
feel that stress described in the article of 'wasting' minutes I'm not
productive. If I take a break, it may feel that the schedule is slipping, but
it doesn't feel like losing an irreplaceable opportunity cost to earn $x in
that 0.2 hours.

------
perfunctory
I have been freelancing for more than 10 years and I don't share these
feelings at all. I don't know how to explain the discrepancy. There was a
period of about half a year when I voluntarily worked just two days a week,
while my client was happy to have me full time. I do take vacations, at least
a month every year. I never work on the weekends.

I think the most interesting part of the article is this:

"While time versus money anxiety may be more acute for freelancers, we aren’t
the only ones who struggle with it."

It seems that the time anxiety is not something unique to freelancing but
rather a symptom of a broader problem with our culture/economy/politics where
business/market plays ever more central role in our lives.

------
motohagiography
This slightly ignores how hourly rates are advantageous to they buyer, and
when you sell by outcome, you compete against all hourly people, who
necessarily have similar ballpark skills and less negotiation ability.

Clients will often salami slice work to pay %10-20 on your quote. It is all
about leverage (batna). Development work is different than say, security
consulting or other design and analysis work, as it's all in the findings.

I recommend building a "Matthew Effect," where you have consistent demand
independent of price or rate so that you can determine the value of a project
objectively. It matters less that your rate is down than being vulnerable to a
gap in demand. That gap returns you to wage slavery.

~~~
photoguy112
For most freelancers "consistent demand" is the hard part. I found it easier
to price a service once you can estimate the type of value it will provide.
For development work this is probably hard to do, but with experience and
enough poking around you can learn the type of value your work provides. It
helps if you can get down to the core details such as how much the product is
currently earning, and how much your work will contribute. At that point it
becomes much easier to sell yourself because when presented with a $ cost and
a $$ profit, it becomes really clear that it practically doesn't matter what
you charge because the returns are on-going whereas your work is one time. If
I made a business $2 mil additional revenue, all of a sudden a 5% investment
doesn't seem as hard to swallow. Coincidentally, charging a high rate leaves
less of a gap, especially once you figure out your typical gaps and when they
happen and budget appropriately.

------
tombert
I did freelance for about 4 months five years ago, and I felt that this
mindset became really hard to avoid. I would end up waking up at around 7AM,
start working at 7:15am, take a 15 minute break to make a sandwich for lunch,
then work until 10pm.

Doing this long enough gets really depressing, and I found it difficult enough
to "turn off" that I ended up working a 9am-6am regular job again.

------
theli0nheart
I have to disagree with the premise of the article. Note: I've been
freelancing / self-employed since 2010.

If anything, knowing that every minute can be transformed into cash has a
profound _positive_ psycological affect. You _should_ question how to spend
your time. Time is, after all, your most valuable resource. It shouldn't be
anathema to be protective of it.

~~~
Mirioron
> _If anything, knowing that every minute can be transformed into cash has a
> profound positive psycological affect._

It makes me think of it like a video game. I can choose when and how much I
want to spend in fun stuff and how much on "grinding."

~~~
theli0nheart
> _It makes me think of it like a video game. I can choose when and how much I
> want to spend in fun stuff and how much on "grinding."_

Exactly.

------
noir_lord
Done both.

Hated freelancing enough that it nearly made me hate programming (something
I’ve loved for 31 years).

I’m happy as a high autonomy employee.

------
lrrrrrrrrrrrr
We thought of life having a serious purpose, and the thing was to get to that
end, success or whatever it is, maybe heaven after you're dead. But we missed
the point the whole way. It was a musical thing and you were supposed to sing
or to dance while the music was being played. -Alan Watts

------
jstewartmobile
" _People who attach dollar signs to their time — or “value time like money” —
tend to be overwhelmingly less happy than those who don’t, because their
nonworking hours suddenly seem less important. “Free” time gets tainted with
guilt because there’s a cost associated with it._ "

Of course this comes from a psychology department, where people get accredited
to start their own state-licensed soma dispensaries.

Is the purpose of life really to "be happy"?

When I have worked, and have charged for my time--regardless of the billing
unit--I may not have been happy while doing the work, but have--far more often
than not--been very proud of the result. Value was created for both the
customer and myself, and the experience from each project is ammo in the clip
toward the next win. And even when the result has been disappointing--still
even more ammo in the clip.

Or, I could get my "happy" from Netflix and quartely trips to Disney World,
then visit the psychiatrist to get my Zoloft prescription to deaden that
inner-voice mocking me for wasting the hours that we only get so many of.

~~~
stdbrouw
You're reading way more into that quote than what it actually says.
"Happiness" in this context is not in-the-moment satisfaction of primal urges,
it's about how you feel about your life in general, which includes what you
describe as pride in your work.

~~~
jstewartmobile
Have you read the paper they linked to? How did it define "happiness"? How did
it measure "happiness"? From the paper, "happiness" can be read very broadly.

I chose to read it the way that the average person I know would read it, and
then I chose to reject that.

edit: And pride of workmanship is not the same thing as happiness. There have
been a couple jobs where I've been rather unhappy about helping particular
people out, while still being proud of how I did it.

------
ngngngng
Does anyone have recommendations for what I can read to get started
freelancing? I had a very successful religious mission, so I know I have
"sales" skills, and I'm a pretty good software engineer, but I feel like I
spin my wheels when I look for freelance clients.

~~~
davidscolgan
My business skills awakening was started when I discovered Kai Davis and Nick
Disabato's podcast Make Money Online:

[https://makemoneyonline.exposed/](https://makemoneyonline.exposed/)

Simultaneously hilarious and incredibly valuable information I had never
before heard. The people in the Kai Davis sphere of influence are all pretty
helpful for freelancers and consultants.

------
yayr
The ultimate constantly limited resource in life is time. So one should
maximize most of the value out of it. Money is just one possible means toward
that goal. Unfortunately, it is easy to get so attached to it, that the goal
is easily forgotten...

------
fxn
It is your choice. You are in charge and freelancing gives you the opportunity
to bill _less_ and leave space to other important things in your life for
which a regular job would compete. Family time, sports, hobbies, learning new
things, etc.

------
JoeAltmaier
I have a different view. Add another column to your ledger labelled 'living a
life'. Value every hour in that column above your rack rate for work. Now the
whole equation changes; all the motivations change.

------
juddlyon
I highly recommend Jonathan Stark's Ditching Hourly podcast:
[https://www.ditchinghourly.com/](https://www.ditchinghourly.com/)

------
doritowitch
As a freelancer I find working-time the least stressful and the time between
jobs the truly stressful part. Work is easy, not knowing when the work and
money will come is what kills me.

------
S_A_P
My initial thought is that if you worry about losing money on a micro level
you aren’t charging enough for your time. I actually feel like I can work
about 50% time and be just fine.

------
mildweed
Now consider the new "gig economy". Usually staffed with people who are in
need of money more than software developers. Their guilt has got to be much
worse.

------
otakucode
Work to live, don't live to work.

That is, I believe, an accurate summary of the article.

------
q-base
Freelancer here. This does not ring true for me. I can see a causation between
freelancing and vacation. Vacations "seem" more expensive as they are both a
cost and a period of lost income.

But all those existential worries looks like an underlying issue with the
person itself, more than freelancing in general. Freelancing may enhance it.
But if you are more angry, less social and hence less happy, then no matter
what job you are in - you should probably consider a change.

~~~
egze
I almost always feel irritated when booking a vacation for this reason. So
many days of lost income! But the funny thing at the same time is - I really
need vacations and always feel better after them. Also the same thing if I
need to do something during office hours (like a doctor appointment).

~~~
q-base
Yes, but it just underscores the point of how important it is to not lifestyle
inflate. I am now coming to a point where I do not feel like I really need the
money more than the vacation. Sure it is lost income, but will it really
change my life as opposed to the time off - properly not :)

------
pwaai
I tried freelancing for a while but it really didn't make economic sense.

there are so many other ways to make money that unless you absolutely enjoy
getting reamed by scope creeps and coding, freelancing is definitely not it.

Given, there's not much an engineer can do.

