Worried about retirement? Your concerns aren’t off base. The first generation to rely on personal investments instead of pensions is already showing signs for concern. For freelancers, the situation could be even worse…but there is hope.
Talk with a freelancer long enough and you’ll probably hear a joke about never being able to retire. (Actually, talk to anybody under the age of 50 these days and it’s likely.)
Retirement just isn’t what it used to be. A lot of Americans are facing down a future where they’re planning on passing away while they’re working or hitting the lottery and never working again.
Personally, I think there’s a middle ground…and I think that middle ground is a must for anybody born since the 1960s.
Working people today need to play the long game. That means sustainability.
We need to look for work and lifestyle design that doesn’t front-load our lives with draining labor, leaving us hoping we’ll live long enough to rest. We have to build a life that’s manageable today and that we can keep up without much stress into our older years.
This isn’t too hard on its face. The challenge is doing that while prioritizing financial health.
That balance has been the goal of my freelance business since day 1. While I’m still closer to 21 than I am to 67, it’s working for me so far.
I’ve seen the life I live now (working a max of 20 hours a week) defined as “retired” by FI/RE types. I’ve also been able to make up a bunch of the gap in recommended retirement savings that I was suffering while employed.
But that’s not really the point. I don’t feel like I need to retire from how I’m living now…at least not any time soon. (When I was employed, I felt like my years were limited.)
So how does that work? Here are 7 elements that have been foundational to me creating a sustainable work life.
Start in a Sustainable Niche
So this is something you can start right from the beginning of your career. We live in a time of unprecedented unprecedentedness, so finding a space where the swings aren’t as dramatic will be important.
I chose healthcare for this reason way back in undergrad and it’s paid off. I’ve worked a solid 20 years without feeling too many of the bumps of any of the recessions or the pandemic in my work life. So check out “recession-proof” niches.
Nothing is guaranteed, but longer-term stability, or at least less volatility, is out there.
Get on a schedule you can keep indefinitely
Americans are ridiculously overworked. Frankly, it’s not sustainable, especially in a country that ties healthcare to employment.
That’s why you have to make a decision as the person responsible for the success of your freelance business. It’s your job to find a path to working less—one that allows you to earn enough to fund your life, provide benefits, and save for retirement.
The key to sustainability here also hinges on creating a schedule that supports your health…through features like vacations, proper sleep, and opportunities to move and stay active. Build all these things in and you won’t need the big retirement cliff like previous generations have.
Looking for inspiration? Look at how retired people in their 60s and 70s live.
Go asynchronous wherever you can
One reason freelancers can accomplish the same amount of work in less time is efficiency. And you know what kills efficiency? Getting sucked into the time- and energy-sucking meetings and planning cycles that define so many employed positions.
If you can get your clients on asynchronous communication, feedback, and planning structures wherever possible, you’ll be in a better place for sustainability.
Connect with an accountant
Tax planning is a real issue for freelancers, especially if you’re earning like a full-time worker.
A good accountant will do more than file your taxes. They’ll be able to help you with questions like deductions, incorporation, and a general tax strategy to maximize your income.
Get a financial advisor for freelance retirement
It might be that guy your cousin goes to or a robo advisor. Regardless, get working with a financial advisor as early as possible in your freelance journey so you can discuss investment options.
Work with people you like
At the very least, cut out clients who make you feel stressed or who don’t align with your work style. Remember you’re molding a business model that you can keep going for decades, so it’s good to find your people ASAP.
Invest like a 9-5er
Even if you aren’t aiming for big “R” retirement, that doesn’t mean you shouldn’t plan.
You might not have access to a traditional 401(k), but you still have options. SEP and Simple IRAs are out there, along with CD ladders, Solo 401(k)s, mutual funds, and everything else that people who work a 9-5 can access.
Make your marketing easier
Marketing is the hardest part of freelance business for a lot of people. But if you want to set up a freelance life that doesn’t require hustling and grinding forever to keep a steady flow of clients, you’ll need to prioritize sustainability in your marketing.
Automate everything
Sustainability starts with doing less work, and one of the easiest ways to do that? Automation.
From paid ads to CRMs to customer mailing lists, the more you automate, the less of a drain your freelance business will be.
As usual though, it’s all a process. If you’ve got any questions on the next steps you want to take toward sustainability, drop it in the comments?
