Security for Freelancers and Consultants

Many people are reluctant to become freelancers or consultants because the risk seems too high. You have flexibility to set your work schedule and take the kinds of projects you want, but you trade that for the security of a full-time job.

I’m not convinced that working independently is necessarily much riskier than a full-time job though. In fact, sometimes it can be safer. Plus, you can also take steps to improve your security as a freelancer.

Security for Freelancers and Consultants

The risks of full-time employment

Having multiple clients and income streams can actually be more secure than having a single full-time income.

Think of it this way: you would never invest everything in your 401(k), IRA, or other retirement funds in the stocks of a single company. That would be ridiculously risky to trust your entire future retirement income to the success of a single enterprise.

But full time employees trust their entire present income to a single company. If they lose their job, they lose 100% of their income. They usually have to ramp up from nothing to find a new one.

How to reduce risk and increase security

Having multiple clients reduces risk

I usually have at least two active clients at all times, plus often smaller side projects and more in my pipeline. If one of my two current big clients suddenly cancels their project, it will hurt my income–but not nearly as much as losing a full-time job hurts. I’ll still have income coming in from my other active client and whatever smaller projects are happening.

Nurturing leads and your network increases security

I also have the security of having additional leads so I can ramp up quickly on other work. I have a network of colleagues on LinkedIn and through the Online Network of Independent Learning Professionals (ONILP). When I’m busy, I refer work to others. They also return the favor. I know I can reach out to my network if I need more work.

So much of the freelance work in this industry comes from referrals! At my current stage in consulting, most of my work comes from repeat business rather than referrals, but that wasn’t true when I started. Referrals from other IDs, freelancers, and other clients have always been a significant source of leads.

Being able to find the next project

Yes, my income is variable, and I have had both good and bad years overall. However, I don’t see freelancing as being as being that much less secure overall than having a full-time job. The security comes from being able to find the next project, not from having a guarantee that the current project is a sure thing.

After all, if you have a full-time job and it ends suddenly, your security is really a measure of how fast you can find a new job. Freelancers and consultants are generally better prepared for finding that next thing. Full-time work can make people complacent, so they can be completely unprepared to look for work if they lose their job.

Selling courses and other income streams

It’s not as common for those getting started in freelancing, but you also have the option of creating course products or having other income streams. My branching scenario course and the eLearning Freelancer Bootcamp don’t make anywhere near enough money to be my full-time income, but they do give me a separate income stream that doesn’t rely on my big clients. I don’t do a ton of 1:1 coaching, but that’s another source of income too.

Other freelancers teach workshops, produce virtual events, manage online communities, or have other income streams. Having diversity in your income is a strength.

How much security do you have?

I think many of us consultants and freelancers probably have more security than we realize, and many people in full-time jobs don’t realize how little security they truly have.

Originally published 10/2/2018. Revised 7/7/2022.

10 thoughts on “Security for Freelancers and Consultants”

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  4. Well said, Christy. As someone who once only had a full-time job, all it took was one lay off for me to realize how vulnerable that can be. I started doing part-time freelance work while also working a part-time job. The funding for that part-time job got cut, and I was so grateful that I was also doing my freelance work. It gives me more security.

      1. Thanks, Christy. The BIG silver lining was learning more about the ID industry. You mention your network of colleagues. For me, one of the things that makes me hesitant about doing freelance full-time is the isolation–not talking and collaborating with coworkers on a regular basis. Maybe it’s just the projects I’ve been working on (and the fact that much of the work has been done in a pandemic), but a lot of it is very solo. I enjoy being part of professional communities like LinkedIn, but with big communities, it’s easy to feel a bit lost in the sea. At some point, if you feel so inclined, I’d love to hear your thoughts and tips about this aspect of freelancing.

        1. The ONILP group is my PLN (Professional Learning Network). That’s the group that I really rely on to avoid that sense of isolation.

          The LinkedIn group is pretty quiet. It’s mostly a place to post announcements for upcoming events. But, you can see what’s happening there.

          You can also register for the twice-monthly Zoom “Community Hour” calls here:

          Besides those Zoom calls, most of the conversations during the week happen on Slack. The Slack group is invite only, but let me know if you’d like an intro to the group founder so you can join.

          ONILP is like a lot of online communities though: you get out of it what you put into it. We have almost 700 people in the Slack group, but maybe a few dozen have posted or responded to anything in the past month. A few years ago, I recommended the group to another freelancer. She never joined a single call. I think she posted once in Slack that she was looking for dev work, but otherwise she didn’t do anything other than lurk. When I asked her about it later, she said she just didn’t find the group very valuable because she didn’t get any referrals from it. I was so frustrated with her–of course no one referred anything to her, she didn’t invest anything or do any work to build relationships!

          Besides that group, in pre-pandemic times, I used to schedule lunches and coffee meetings with other local IDs. I have only done that once in the past 2 years, although I hope to do it more often when the Covid numbers are low. I do like having those conversations with people and keeping up those local relationships. I love having Zoom and all the online tools, and I so use those to connect–but it is nice to share a meal sometimes too.

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  6. Hi Christy,
    Thank you for this article. I value your perspective on this issue because I know you’re speaking from both experience and observation. One question: for a 2nd career person who recently graduated from a masters degree in instructional design with a portfolio, but little experience in ID, would you suggest they “get experience” with a traditional job first or just dive in to the the field of consulting? The reason I ask is because in most industries a certain level of experience is typically required before venturing into consulting.

    1. That’s a great question! I think you could find some entry level freelancing work even without experience, but maybe not higher end consulting.
      Let me clarify how I’m using the terms here. Freelancing can be any independent work (in the US, that means paid on a 1099). In practice for elarning, freelancing often means being a spare set of hands on a project, usually doing development in a tool like Storyline or Captivate. It might mean subcontracting too. The scope and direction for the project are decided by someone else, and you’re an extra resource to fill a gap on a team or help a project finish faster. Freelancing tends to be paid hourly, although you might be paid with a fixed budget.
      Consulting tends to be higher level and more strategic. You’re helping clients figure out what solution they should pursue, setting the scope and the direction. The pay tends to be higher because you’re using your expertise and adding more value. Consultants are more likely to specialize in a particular type of work and to be known professionally for that niche. Consulting is more likely to be paid a fixed price for a project.
      Note that both of these types of roles are needed and important. There’s no moral judgment here that consultants are “better” than freelancers, but they do tend to be more experienced. I don’t think you’re at the level yet where you can call yourself a consultant, but I do think you could find freelancing development work, probably subcontracting to start. I suggest avoiding anything with a fixed price budget rather than hourly until you get some experience and know how long it takes you to finish tasks.

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