1 in 5 Freelancers Earn More than $100,000 Annually: Here's How They Do It

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Photo by Mimi Thian on Unsplash

The life of an independent worker is compelling because of the freedom it offers and the power to choose your destiny.

Lately, the gig economy has ballooned to 58 million people and generates roughly $1.28 trillion of revenue for the U.S. economy — equal to about 6.2% of U.S. gross domestic product (GDP) in 2018 or the entire economic output of Spain. Independent work is now becoming more of a norm and is said to become the U.S. majority workforce by 2027, according to a study by Upwork.

The number of full-time independents who work this way by choice has risen to 12.4 million. However, only about 20% of the lot earn more than $100,000 annually.

So how do they do it?

Many freelancers share their 2 cents to achieving the 6-figure milestone and reveal their tips and tricks. But when you study a large enough sample size, you’ll notice that there is no sure-shot formula. 

That said, there is an intersection.

This article aims to compile the most common yet critical lessons by high-earning freelancers.

Stay Close to the Money

It goes without saying that 6-figure freelancers are skillful at what they do. But one of the main reasons they’re able to rise above the rest is because they possess the skill of milking money out of their craft. 

One way to do so is by gravitating toward high-ticket clients who are willing to dish out money. This dramatically increases revenue without scaling a team or increasing how many hours they work each day. Such clients could be the top-performing bunch in their field with significant funding. If their skill can be used remotely, location can play a role as they can target clients in states with a relatively higher minimum wage or a country with better-performing currency.

Say No

Average-earning and 6-figure freelancers share one thing in common: Time. High-earning freelancers know how valuable their time is and how to effectively treat it as a commodity without burning out.

Being accommodating could get small and difficult projects, which could be great to get started and make immediate money. But to make big money, many high-earning freelancers decline offers if they’re not worth their time and energy. In some cases, they do take up simple projects that they know they can delegate to other freelancers, and take a cut.

Manage Finances Wisely

Every top freelancer knows how critical it is to manage finances. To some effect, all freelancers are their own accountants — solely responsible for bringing in work, dealing with unpredictable income, taxes, unforeseen expenses, and late-paying clients. 

But today, not every freelancer needs to be an accounting whizz to manage their finances. Many are turning away from traditional banks and moving to banks specifically designed for freelancers. For instance, the Lili app, which offers a banking tool to manage a freelancer’s taxes, track their income, expenses, and budget. As a result, they can use their valuable time toward their job and still be on top of their finances.

Lili now offers $100 for every customer referral. Users can earn up to $1,000 (by referring 10 people), and both sides receive the $100 reward, after the recipient signs up and uses the Lili card for a minimum of $250 within 45 days.

Put Yourself Out There

Wayne Gretzky famously said, “You miss 100% of the shots you don’t take.” High-earning freelancers are not afraid to put themselves out there in a way that makes them feel right and comfortable. This could mean pitching through email, connecting via LinkedIn, commenting on Twitter posts, or networking at conferences.

In many cases, landing high-ticket clients requires a certain amount of luck. Much like stoic philosophy, these freelancers know they have influence only over what is in their control. And to improve their chances of being seen or heard, they have a strong online presence. 

Patience is a Virtue

The most common link between all 6-figure freelancers is patience and persistence. Many describe their first few years as a struggle, albeit a necessary struggle, which helped them hone their craft, develop relationships with clients and figure out how to take on work without burning themselves out.

They recognize that rejection is part and parcel of freelance life, aware that a low conversion rate of high-ticket clients is considered a success.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.