Freelance & consultant: you can be both! But, is it for you?

What are your options?

While wondering how to start your path as a consultant, the main question will rely on working for others or for yourself. As a consultant, the main matter and the one that will define your challenges and opportunities is whether you are a freelance consultant or an employee consultant, but to understand better, let’s see what each of them means.

• Employee consultant: as employees, these consultants are tied by a contract like any other employee, subject to the missions given by the employing company and profiting from the benefits being an employee has.
• Freelance consultant: a freelance worker is an independent worker who can provide services to several clients at the same that and who establishes their own rates and conditions.

Sometimes the term independent contractor is used interdependently with the word freelance, but in fact, there are some subtle differences. An independent contractor can be hired for a project with a determined end date (as a freelance) while having to work exclusively on that project and for that employer for that period (as an employee). This type of figure is not present in every country, so you should consider how it works in the country you intend to start your professional activity.

All these positions have in common that they are occupied by professionals who bring their expert knowledge to people who require those services. The difference is the conditions surrounding how these services are provided.

Your life as an employee consultant

Employee consultants are consultants in any field who work exclusively for a consulting firm. They are specialists who offer their advice in their field of expertise for accompanying or guiding a transformation, enhancement, or implementation for the consultancy’s customers.

1. Your profile

You are an expert that looks for a comfortable place from where to develop yourself. Maybe you want to gain more work experience before moving into freelance consulting, or maybe you prefer to be employed by someone else who takes care of everything that surrounds what matters to you: the client’s needs.

You are adaptable and focused on the job, and above all, you enjoy knowing that will be given a roadmap to follow concerning your relationship with the customer and that you are backed by an institution that cares about you and the part of the job that you are not that interested in. You want to advise them and help them on their transition journey but will not really be comfortable looking for said client, promoting yourself and your services, budgeting, invoicing, and doing the taxes. Most likely, you are not interested in having a business of your own, or at least not yet, so this position seems ideal for you.

2. Your working conditions

Employees are obligated to follow the employer’s rules concerning schedules and working conditions. Still, they will not have to worry about paying their taxes monthly nor other legal obligations that the company will take care of.

The working location will be specified by the company, together with the remote work policy. Working for a firm will usually mean that you will have to spend time at the office, which will give you the chance to work alongside your colleagues and have a more fixed routine than if you were freelance.

In a company, you will be given your missions and projects, taking away the hassle of looking for them, but, on the other hand, will force you to work on all the projects assigned to you, whether you like them or not. Also, being an employee means exclusivity, both because of contractual and ethical reasons.

Corporate will provide you with trainings and health insurance, along with taking care of taxes, paperwork and legal responsibility for your actions, which is a weight off your shoulders.

3. Your salary

Employee consultants receive a fixed salary each month that does not depend on their performance. It can increase with bonuses due to performance, but it will never decrease.

You will have a stable income coming in at approximately the same time each month. Also, this salary will be entirely for you, without the need to allocate part of it for paying fees, taxes or any other job-related expenses.

Your life as a freelance consultant

Freelance consultants are also experts in their field but, instead of being employed by a business, they are self-employed. They declare themselves as independent professionals, which comes with some obligations as well as some freedom in several areas.

1. Your profile

Regardless of being a consultant or any other kind of freelancer, you will need a similar set of skills, besides being an expert in your field.

Let’s address first what being an expert means. Commonly, experts are curious people who are up-to-date in their field and enjoy going deeper into it. It is not only their interest that makes them experts but their actual time spent in the field, which allows them to offer guidance and advice to clients.

However, as we mentioned before, being an expert is not enough when you decide to go freelance. Freelance is a synonym for being your own boss, which means taking care of all the important (and less important) decisions in your “company”. Organisation will be essential, as well as being able to handle some uncertainty and a dynamic work environment. Prepare to be your own marketing team, finance team, sales team and everything else! This workload is additional, and you are not in charge of any of it when you are an employee, but also, you do not have the amazing opportunity of having full control over your business, who you work with or how you promote yourself.

You need to have good planning skills, patience, be versatile and curious and also, when things go slowly, be resilient.

Freelancers need to somewhat enjoy this ever-changing environment with different projects, different specifications and different tasks but, in fact, this part is not as different as what an employee consultant might live. The only difference is that the freelancer consultant will probably have more room to negotiate freely and handle the project.

2. Your working conditions

Being freelance means establishing your own working conditions while taking care of legal and financial matters too.

You can choose to work remotely or from wherever you choose, even another country, as long as you can continue providing your service. You can distribute your workload as you please during the week and go on holidays with more freedom than when you are an employee at a firm.

As a freelancer, you will probably work alone most of the time, which might be an advantage or a disadvantage depending on your personality, but no matter which one it is, it will be an aspect to take into consideration. You can always resort to coworking spaces or meet-ups with people who work in your field.

You will have to look for your clients, which will mean networking and being active, online and offline, to market yourself and your services. If you need help, this part can get easier using freelancer platforms or, if you trust an intermediate, they can help you find those opportunities, making your job easier. For example, at Ekkiden, we count on our trustworthy freelancers when we have projects that fit their profile. Consulting companies also need freelancer consultants to help them meet a need from a customer, as they do not always have the required expertise. You may need to have different sources so you can work with several at the same time, without exclusivity being necessary.

The fact of being an independent provider means exactly that, being independent. Part of your responsibilities will be to keep on learning on your own, looking for health insurance, doing your taxes and paperwork as well as being legally responsible for your actions. When we address all these responsibilities at once, it can seem daunting but at the same time, it gives you an overview of what running a business looks like. The confidence, satisfaction and experience it brings cannot be equally achieved by being an employee consultant.

3. Your salary

As a freelance consultant, your salary will depend on your fees, which you will be able to set as you wish in your contract. It is recommended to scan the market and see what the usual rates are and then, calculate how much you’d want to earn annually to adjust your rate. You can set your rate per hour, per day or per project, depending on what you see fit and adapts better to your activity and kind of projects.

Your remuneration will forcefully be higher than that of an employee for covering all the expenses that corporate will not be covering for you (health insurance, taxes, equipment, paid leave, sick pay…). They tend to be higher too because you can calculate the added value that you bring and charge according to it. You will also need to know that payments do not always come immediately, as it is usual to give a payment window that you can set. It should be similar to the ones other professionals offer in the field.

Your income will vary monthly, depending on the amount of work you do, which will mean that some will exceed your expectations and others might flop. This is why a global perspective is needed to maintain stability and have a realistic overview of global performance.

So, what are the differences?