The beast called change stalks us all, even while we are in the most-secured zone. A drop in one quarter earning, some technological innovation, some fancy of a new CEO, negative publicity tagged eternally by Google and others, some political decision – your earning may be effected. If you are in a job, the situation is more delicate.
One freelancer earns, say $ 3000 a month on an average. He lives quite well, choosy about things like cars, phone and accessories. He has read somewhere that people save little and he dutifully saves $ 300 a month. In a year, he saves $ 3600. He lives alone and spends on an average $ 2700 a month. He socializes a lot and is considered to be a gentle and friendly person among his ‘friend circle’. He runs some debt, minimal, credit card and some 5-10% of his monthly income.
Another freelancer, like the other one wants to live in a separate apartment but chooses to live in a hostel which saves almost 60-70% of his accommodation cost. He also earns $ 3000 a month and saves $ 1500 per month like a fanatic. He has no general friend circle but only ‘networks of influence’. He networks with clients, fellow freelancers, DTP – artists, web-designers and as such. He drives a very old car brought almost one tenth its price, eats mostly at home, reads a lot and plans to start a consulting business. In a year, he will save $ 18,000 . He has no debt and avoids everything which he cannot pay by cash.
Now, consider that both are not getting regular work as some of their clients have chosen some cheaper suppliers and some have their own business problems. In a November evening, while waiting for work, both take a stock of the situation.
- The first one finds that he can only last a month while having his present level of lifestyle and cost-base. He is in panic.
- The second one finds that he can live in his present level of lifestyle for a year if he does not get a single job for next 365 days. He has however 365 X 24 = 8760 hours to do, build, grow with anything his fancy chooses
- The first one now need to either lower his rate or try to get a full-time job.
- The second one can do any possible combination in these 365 days
- The first one looks ahead with anxiety and apprehension and his ‘friends’ cannot do much about him
- The second one causally asks his ‘sphere of influence’ and checks whether the situation is specific to him or a systemic one. He can plan now – he has a year to look forward to.
Now, the question is which one you want to be ?
The first freelancer forgets that economic freedom is the engine oil for all other higher-level and sophisticated engines of freedom. It is the lack of this freedom that we acquiesce to the lunacy of our boss (/ess), undue demands of our clients, taste of our readers or to the antics of our suppliers. Economic freedom for an individual can be compared to the power plug for a computer.
In 2006, while I became a freelancer after being a corporate manager for a decade, I was forced by circumstances to be the second freelancer. It was not a conscious choice. But somehow, this went into the gene. In the midst of order falling like raindrops, a part of my mind’s engine thinks of arid days and swipes the earnings immediately. I call this de-liquefaction.
Money or cash in its most-liquid form can have 3 states only : consumption, delayed consumption, change of state.
Change of State of money is governed not by money itself but the wisdom of the individual. In case of a freelancer, it is a person. In case of the largest economic entity, it is the leaders or group of leaders, headed by a person.
It is always a personal choice as what type of freelancer you want to be ?