Augmenting Your Freelance Income

Basically there are three avenues to pursue to keep your freelance financial picture sunny: diligence in negotiating the best freelance deals, scouting for sources of augmenting that income from time to time, and adding secondary sources of income to the overall financial setup.

The prime ingredient in the discovery of funds to supplement income is your own ingenuity. People in other businesses have advantages you don't. They can, like the publisher of the magazine you write for, apply to numerous people to raise capital: customers, suppliers, insurance companies, banks, employees, other companies, venture-capital firms, investment bankers, and governments. If your business is a sole proprietorship, as is that of most freelancers, you don't have those options. The ability to get credit depends on your personal reputation. Third parties cannot invest in the business without incurring responsibilities for business debts as well. That usually means you have to rely on relatives or very close, good friends, which often isn’t a good idea.

If you’re thinking of getting a loan from your bank to tide you over, think again. In most cases, banks do loan small businesses money for operating capital or improvements, but freelance writing isn’t generally one of them. In fact, most banks don’t really consider you a small business. Plus, the loans they make to small businesses usually start at $50,000 or more.

An alternative to borrowing the money is applying for a grant. The pros and cons of public funding of writers are as numerous as the writers who do or do not get the grants. Living from grant to grant is much like living from paycheck to paycheck. The truth is that once you get on the grant merry-go-round, it’s hard to get off. Some writers actually write less and less the more they skipped from one grant to another since   it's easier to get a second and a third grant after you've got that first one. But getting that first grant can be a real challenge.

While there certainly are lots of grants out there, matching up their requirements to your situation is difficult. Let’s face it, if you want someone to give you money, you’ll need to fulfill their requirements. Also, one mistake on a grant application and you’re out. In fact, you may find writing a grant application harder than the writing you normally do. Grantors look for many things, least of which is good writing. For many writers, the chore of getting the grant in the first place may be more than it's worth. Searching for “writing grants” online will yield many sources.

Trying for prizes, on the other hand, may not be such a bad idea. If you have a novel on the back burner or if you write in a specialized field—travel, science, business, etc.), you may qualify for annual prizes given by a variety of organizations, some of which come with a cash award, no strings attached. Many prizes, even if they don't carry a cash award, will eventually help line your pockets, since the prestige of winning can be a feather in your cap and portfolio. If you do win a prize or receive an honor, milk it for all it’s worth. If you think you have a chance, take the time to fill out the forms and send in the required material.

Get creative when thinking up ways to bring in additional income. Perhaps you have an extra room in your house that you can rent out to a college student, or if times are especially tough, consider taking in a roommate or housemate to help meet your bills. You could also rent out equipment you have that you use only once in a while. Post notices everywhere, locally and online.

Lastly, consider selling items on eBay. While selling one or two items won’t bring in much, you could set up a sideline business selling items in a particular category such as collectibles. To do this successfully, you’ll have to set aside time to purchase inventory and pack and ship the things you sell. This will eat into your writing time, but money is money, no matter how you earn it.

If you look around you may find you have that other sources of income, no matter how small, that would help relieve the strain on your business budget.

Getting Paid What’s Due

It’s hard enough working as a freelancer, but add to that the frustration of not getting paid on time or not at all and it can become a nightmare. For most writers, bill collecting is a time-consuming and distracting endeavor. But in today’s economy it has become a fact of life. Just as the people you owe come after you if you haven’t paid your bills, so should you go after those who owe you.

Often you’ll see the signs early on. An editor fights with you for a few more dollars payment. Or perhaps he or she doesn’t let you know up front that the publication will be paying up to two months after publication. If you notice clues like this, it’s better to back away from this market because you’ll surely have problems down the line. But many writers hesitate to do that or to hassle their editors about payment for fear of losing the work.

Timely billing is the first step toward timely payment. Send an invoice with every piece you produce. Make sure that you put your Social Security number on it. Sure, everyone is telling you not to put your Social Security number on anything, but this is a bill and today, businesses use that number to identify you.

Also, make sure you state your terms of payment, unless otherwise arranged. It’s a good idea to ask an editor when the publication normally pays writers before you begin working for it. State on your invoice exactly how you want the check made out—John Doe or John Doe Communications, etc.

If you’ve incurred any expenses that you’ve previously discussed with the editor, include them on the invoice. Some editors ask that you bill them separately for expenses. Enclose copies of receipts if your editor requires them. If you’re sending your invoice by Email, scan your receipts and send image files of them. If sending by regular mail, send paper copies. If you invoice correctly and keep good records, you’ll find you can prevent problems from arising. Remember to keep copies of all your invoices. Mark those paid when you’re paid and keep an eye on those not paid as yet.

If you haven’t received payment when you expected it from an editor, send a pleasant Email reminder. Jog the editor's memory if a few weeks have gone by without payment. Editors get busy and many are  overworked and understaffed. Your invoice may have gotten misplaced. If you receive no answer within 10 days after this reminder, however, the editor may be ignoring you.

A firmer letter, sent by regular mail, should remind the editor that you met your obligations and you request that he meet his or hers. If you receive no response from this, then call the editor on the phone to find out what’s going on.

If none of these tactics work, then you can resort to charging interest on unpaid accounts over 30, 60, or 90 days, just as you’re charged if you're delinquent in paying your bills. While you may not receive the additional amounts, you'll get a businesslike message across.

If all else fails, you can always take the publication to small claims court. Depending on how much you’re owed, this can be more of a hassle for you than just admitting defeat and claiming the unpaid amount on your income tax. If an editor contacts you and tells you that the publication is having problems, back off a bit, but not too much. After all, you deserve to be paid for what you have done.

Generally, slow-paying markets don’t pay expenses. If you’re having problems collecting payment for the writing you’ve done for them, chances are they’re too strapped or cheap to pay for expenses.

Avoiding Deadends and Deadbeats

As you move forward in your freelance career, you’ll no doubt run into deadend markets and deadbeat editors. Perhaps the only problem you’ll have is to wait for the acceptance of your pieces. But chances are you’ll have many more negative experiences.

Editors are busy people. When an editor says he or she will send a reply to your query tomorrow, you can bet it will probably not arrive, at least not for a while. It pays to follow up with all your correspondence. Sending a polite reminder is good business, not hassling an editor.

Maybe you’ve been working with an editor for quite a while. You believe you have a good relationship. He’s told you that he likes your work. Then one day, you fail to get a response. It turns out that he moved on to a completely different type of publication—without telling you. You can try to track him down, but you’d be better off finding a new market.
                                         
In these uncertain economic times, it’s not unusual for a magazine to fold precipitously. You may have been waiting patiently to get paid, and it isn’t until several months later that you discover that the publisher went bankrupt.

Writers used to have to worry about whether the U.S. Postal Service delivered their manuscript. And even if your manuscript arrived it then got stuck in the mailroom. There seemed to be a definite relationship between how many floors a building had and how long your article sat in the mailroom. And if you sent your work to one of the higher paying periodicals, it most likely ended up in the slush pile where it may have sat for several weeks before an unpaid intern took a look at it.

Your article is accepted; you're jubilant. Then you get word from the editor that she had to kill your article. Even then you have to wait an unduly long time for the kill fee. Needless to say, the article's timeliness has been its undoing—the poor thing now is dead. You can’t even send it elsewhere.

And if you think that one or more of these may happen to you at various times, think again. It’s not uncommon in the freelance biz for nearly all of them to happen at the same time or at least one right after the other. It’s enough to drive a writer crazy.
                                               
Can you spot these possible disasters beforehand? In some cases, yes. But most of time, no. In fact, you may have no indication that a problem exists until the worst happens.

You can prevent some negative experiences from happening by taking a few precautions. Many writers refuse to do more than send a query to a new publication, then sit back and wait for the results. You’ll soon discover that there’s always a shakedown period at a new publication. You don't want to get caught in the fallout. Some magazines just don’t make it.

Magazines that pay on publication are notorious for creating problems. Publishers want to hang on to their money for as long as possible. Many times "pay on publication" means "several months or more after publication." But then, you may be trying to get into a new market. The number of publications paying on acceptance has dwindled with the recession. Do your homework and study the markets before you decide to send any work to them.

One tactic you might use is to wait the required time for an answer from a publisher or editor, then send a registered letter advising you're withdrawing your manuscript or query. You’ll then be free to submit it elsewhere.

To avoid problems once you get an assignment, you should make sure to immediately follow the conversation with a follow-up letter of assignment—sent by Email or regular mail—detailing the article topic, length, agreed-upon rates, delivery date, and expenses to be paid.

Lastly, save all Email messages from editors. When you do have a problem, you can then send forward the original message to the editor who may be denying what he or she said in the first place. It’s only then that you’ll exclaim, “Thank God for Email!”

Setting Goals

Just as an ice hockey player sets his eye on the goal with the objective of getting the puck past the goalie, so you should set your eye on the upcoming year. But instead of just one goal into which to cast your lot, you should have several.

To begin, take a look at what you’ve accomplished in the past year. Make a list of your writing accomplishments. Don’t limit them to just pieces you’ve gotten published, but to what you think you’ve done that was not only good but super, even if editors didn’t think so.

What’s missing from this list? Were there pieces you wanted to write but didn’t get time? Did you miss the mark on the better markets? Was there something special you wanted to write about but never had the chance? And finally, did you make enough money?

After you’ve analyzed your accomplishments, it’s time to set down some goals to make this year, 2013, better than last. Your main goal in your freelance writing business is to move forward. If you fell back a few steps or remained stagnant, then it’s time to give yourself a kick in the butt and get moving.

Goals come in two types: long term and short term. The former helps you plan way ahead while the latter helps you stay focused on the here and now.

Long term goals usually span three to six months, sometimes even as much as a year or more. These might include creating and working on a book idea or breaking into new markets. Ask yourself where would you like to be with your writing in, say six months. What would you like to accomplish?  What skills need improvement to enable you to achieve your goals?

Short term goals are more current, covering as little as a week or as much as a month. They’re also more specific. For instance, you might set a goal to get a particular article or story published. Or you might promote yourself on one of the social networks.

For both long and short-term goals, you’ll want to list what you need to do to accomplish them. Limit these needs to three. That’s realistic, given the amount of time you’ll have to devote to accomplishing them. More than three may overwhelm you, causing you to avoid that particular goal.

Above all, keep things simple. Don’t list too many goals for a specific amount of time. Set only the number of goals, both long and short-term, that you can easily accomplish in the time you’ve set.

Once you have your goals in place, set time to review them. The obvious is at the end of this year. But you’ll want to review your short-term goals as they come due, much like a certificate of deposit. Did you accomplish what you set out to do? Did you fall short and if so, by how much?

If you failed to accomplish a goal or two, don’t fret. Just roll the unfulfilled goals over to the next time period. For your yearly goals, there’s always next year. And for your short-term goals, there’s always next week, next month, or next quarter. Generally, review all your goals at the end of each quarter, at least for the first year. Doing so will enable you to see where you’ve been, what you’ve accomplished, and what you need to do to move ahead.