Design Domination Podcast Episode #157: Designer Freelancer vs Employee

Thinking of going out on your own as a freelance graphic designer or web designer? Find out the pros and cons of being a full-time freelancer versus employee and some points to consider before working for yourself full time.

Music: https://www.bensound.com


Graphic designers usually start out working for someone else before they go out on their own, but you may have wondered if you should work for yourself.

Or when is the right time? Is it when you have a certain amount of savings? Is it when you have more experience under your belt? Is it when you have some freelance clients? Is it when you get fed up at your job?

That decision is different for everyone.

For me, the deciding factor was when I was making more money with my freelance work than with my salary at my full-time job.

You may also have wondered how is being a freelancer different from being an employee?

Both working a full-time (or part-time) job and freelancing have their own unique pros and cons. Your comfort level, your personality and your entrepreneurial drive definitely play a factor in which one you choose.

Benefits of Working for Someone Else

Let’s look at the benefits of being an employee at a full-time job.

Steady income

A huge benefit is steady income. You already agreed to a salary when you were hired, so you know how much to expect every time you get paid, and you’ll get paid the same amount on a regular basis.

A lot of companies will pay you 1.5 times your rate if you work more than 40 hours a week—overtime.

Set hours

You usually have designated work hours at a job, and even a set number of hours. Once 5 o’clock hits, you’re done for the day.

Specific roles

Your job has specific roles. You might be tasked with designing documents for the web and for print, dabbling in websites, designing social media posts and so forth.

Employers love to have a jack of all trades. But you’re not responsible for the company—bringing in clients, sales and marketing, paying vendors, collecting on invoices, etc.

A lot of times there may be a project manager who deals with all client communication and deadlines too.

Accountability

When you work at a job, there are others who will hold you accountable. Some designers do better with someone else setting deadlines and schedules and reminding them about them throughout the project.

Social interaction

Many designers enjoy collaborating with other designers or other team members. Working at a job you get more opportunity to do that every day.

Companies also often have holiday parties and have fun outings for team building. A company I used to work for took us bowling. Another company took us to the movies and lunch.

I also would go out for dinner a lot with my coworkers. I definitely miss that.

Training

Oftentimes organizations are willing to invest in training for you. They may pay for it in full or maybe pay 50%.

At my first job out of college, the nonprofit I worked for sent me to a proofreading and editing class because, along with designing all of the organization’s materials, I would also do proofreading of its magazine.

Some of my accessibility course students have come from companies that paid for them to take my training in accessible PDFs and InDesign or for website accessibility.

Insurance

This next one can be a big factor. As an employee for someone else, you don’t usually have to worry about insurance—medical insurance, disability insurance or other types of insurance.

They usually offer you medical insurance and maybe disability.

If the company makes a mistake or your work contains a mistake, it’s not usually on you. It’s the company’s responsibility.

Paid leave

When you’re an employee, you usually get certain benefits such as sick leave, vacation pay and family leave.

Work continues without you

That brings me to my next point—work continues without you. If you are out of the office for a while, another designer at your job may step in and help until you’re back to work.

Retirement benefits

When you’re an employee, you often also get retirement benefits. They contribute money to a retirement plan for you.

Cons of Working for Someone Else

Now there are cons to a full-time job.

Salary cap

One is that your position may have a salary cap, so you may be limited to what you’re able to earn at that company.

Salary out of your control

Another point is that your salary is out of your control. I mean, you can do things to potentially get more money, but you don’t control it.

You have to ask for a raise based on better performance, reliability, increased skill set or cost of living. You won’t necessarily get it—not just for those reasons but based on factors outside of your control—for instance, if the company isn’t doing well.

Expectations

The organization you work for may expect that you have a wide range of skills, mixing both creative and technical—a jack of all trades.

A lot of times these are unrealistic expectations. A designer’s talent is usually creativity and most people in general are not an equal mix of creative and technical either.

Decision making

Something else you may not like about a job is that they call the shots. So if you disagree with the direction of a project or any of their policies, you pretty much have to suck it up. If you don’t like your boss or coworkers, you can’t do anything about that.

Hours

Hours are a pro, as I mentioned, but they can also be a con.

Even though set working hours are a good thing, you usually don’t have the option of choosing your hours.

Plus, you still may have to commute. That’s on top of your work hours.

Growth

Depending on the size of the organization, there may not be room for growth. For instance, when I worked at my first job as a designer, I was the only designer. There was no other designer to manage. There was no promotion available.

They could have given me a more prestigious title, sure, but if I had wanted to art direct someone after being there for several years, that wouldn’t have been an option.

Benefits of Working for Yourself as a Freelancer

OK, now let’s talk about working for yourself as a freelancer, an independent contractor. There are lots of pros.

Income

When it comes to income, there is no cap as to what you can make. You can make as little or as much money as you want.

You can also charge whatever you want. So if you want to give yourself a raise, you can do that at any time.

Hours

When it comes to the hours you work, you have the freedom to choose when you want to work. You might want to work a few hours here, a few hours there. You might be a night owl and only want to work then.

You also don’t have to spend time commuting anywhere, since you can work from home.

Roles

When it comes to your role or your focus, you’re the boss, and you can do whatever you want in terms of the type of work and clients you take on.

You don’t have to do all the things. You have the flexibility to choose a specialization and just focus on that instead of offering all types of design services to all clients. Honing in on specific types of work allows you to be more productive.

You can hire out work you don’t enjoy doing.

Decision making

When you work for yourself, you call the shots about everything, so not just the work you do and the clients you take on but:

  • how much you charge,
  • your policies,
  • the direction of your business, etc.

Cons of Working for Yourself as a Freelancer

There are some cons to freelancing.

No regular paycheck

First is that you don’t have a guaranteed regular paycheck. You may make a lot of money one month and less the next. Some designers don’t like this roller coaster.

Once you have enough steady work coming in though, you can pay yourself the same amount regularly. For me, that’s just transferring money from my business account to a personal account.

Hours

Even though I mentioned hours as a pro, hours can be a con as well. That’s because as a business owner (even as a freelancer, you’re a business owner!), you may find yourself working more hours than you would at a job—on client work, invoicing, marketing and so forth.

You also might find it hard to draw a line between your work hours and non-work hours, especially when you work from home.

All the roles

As a freelancer, you wear all the hats, unless you hire someone to help you. You not only have to do the work, but you have to also:

  • network and find clients,
  • do other sales and marketing tasks,
  • write proposals and estimates,
  • send invoices,
  • deal with any late-paying clients,
  • manage the project and deadlines,
  • maintain client communication,
  • find subcontractors when needed,
  • pay vendors,
  • maintain your website,
  • and more.

You have to be the business owner. Most designers are introverts and feel really uncomfortable putting their foot down with clients or don’t like networking.

Insurance

In the United States, insurance is sometimes the reason designers don’t go out on their own, even though there are many health insurance alternatives and catastrophic health insurance plans out there.

Unless you can get medical insurance through someone else, you have to get it on your own.

Also, when it comes to insurance, you have to think about disability, in case you can’t work temporarily or ever again.

You have to think about insurance for your equipment in case of fire, theft or something else, and if clients come to your house. What if a client falls? They could sue you.

These types of situations fall under general liability.

Then there is professional, or E&O, insurance. This covers you in case you make a professional mistake, say if you caused an error in a print document that had to be reprinted as a result and the client asked you to pay for it, but you couldn’t afford it.

Paid leave

When you work for yourself, you don’t get paid sick leave, vacation time or family leave. You have to charge enough to account for time off.

Also, when you’re sick, unless you have hired someone to help, work will slow or stop depending on how you feel.

If you go on vacation or family leave, work will stop until you get back.

Social isolation

When you work for yourself, it’s easier to fall into social isolation.

This happened to me for a few years. I think it was one reason I put up with bad clients. I didn’t have anyone to ask what to do or hear how other designers prevented this.

I also didn’t know at the time what other designers in my area were charging so I could assess my rates.

I didn’t have anyone to bounce creative ideas off of.

You have to actively seek out online and in-person groups to avoid that. There are so many more options now.

You can join associations to network at. You can find a few trusted designer colleagues to bounce ideas off of. You can find a mentor.

Taxes

When you work for yourself, you are responsible for your own taxes. In the United States, you will likely be paying estimated quarterly taxes, so that you don’t end up owing so much at tax time. You don’t want to have to pay a penalty or interest either.

Should You Be an Employee or Freelancer?

So there you have them—the pros and cons of working as an employee versus working for yourself.

If you’re trying to decide whether to remain an employee or freelance with your own business full time, you have a lot to consider.

I also recommend having some savings in place, especially if you’re solely responsible for your living situation and expenses.

But it’s also not an either-or situation, like a light switch. It doesn’t have to be one day you’re an employee and the next a business owner.

You can also freelance on the side and build up a client base before you go out on your own. I did that for seven years before taking the plunge to work for myself full time.

It’s important to know though that when you work a full-time job and freelance on the side, it can be a lot, depending on how much you take on. I used to come home from my job and nap on the couch, then eat dinner, do some freelance work and go to bed. I would get freelance work done on weekends as needed too.

One of my freelance jobs had previously been someone’s full-time job—and that was just one client. So I took on a lot outside of my full-time job.

I also know a few designers who maintain a part-time job for the security and have their business on the side.

So you have lots of options based on your comfort level and how much risk you’re willing to take.

If you’re driven to go out on your own don’t let these things stop you and just be aware of them and plan for that.

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