The roadmap towards passive income as a freelancer

Freelancers often work hard for many hours and don’t see much return in the way of income. They are often viewed by those who hire them as cheap labor, and the extra time they put in to find clients, create proposals and chase down payments are not valued by the clients.

If you are one of those freelancers, you are likely wondering how you can improve your income without working even harder.

The first step to making more money as a freelancer is to create systems that generate more income. For instance, instead of working for a flat fee (which means you can underestimate the time a project takes and get royally gipped), charge for all your work time. Use a time tracking software and bill the client for every minute of work, including discussing the project on the phone, answering pesky emails and posting updates on social media.

Charging for proposals is good business. It means you don’t waste time writing up documents for clients who won’t hire you in the end. And clients who aren’t really serious will back away as soon as you mention a price, saving you both time and money. You should also have a template for proposals, in order to reduce the amount of time it takes to create them. Plugging relevant information into an already existing document will take much less time than starting from scratch. Create templates for other types of documents you produce as well, such as reports.

Next, start thinking about your work in terms of business value. When presenting materials to future and current clients, make that the center of your sales pages and reports. Make it clear at every meeting how the client’s business will benefit/is benefiting from hiring you.

Slowly start raising your rates and taking on better and higher paying clients. Once you have better rates, you can work fewer hours and make more money.

Consider taking on freelancers to do some of the less important work and becoming more of a manager. If your rates are high enough, you can hire a freelancer at a fraction of the price you are making. Management (done right) is less time-consuming than doing the work yourself. You won’t take home as much per project, but will be able to take on more clients and more work. Delegate responsibility and only interfere when necessary, so that you save significant amounts of time.

The next step in improving your income is to change your status from freelancer to consultant. Create a range of products with accompanying prices, and sell them to your clients. For instance, a client can choose a consulting package which includes 10 hours a month of advice, two reports and one in-person meeting. Just by virtue of calling yourself a consultant, you can charge much higher prices. And since you are selling the same product to multiple businesses, there is no need to write proposals each time. You’ll be more productive, work fewer hours and enjoy a higher income.