As I have been writing about the challenges of getting invoices paid on time, I have been struggling to figure out what is the best way to handle this. So this is the background. I am not necessarily trying to reinvent myself because I used to be a consultant before, but I am definitely trying to transition back. During my 10 year absence as a consultant, I went to do other things, mostly working in a startup. In that process, I did not develop industry contacts with people who can hire me as a freelance consultant.
This is when I hooked up with ex-colleagues who run a boutique consulting firm. The work is interesting but does not pay extremely well. Let us say between $50 and $75 an hour but since the projects last for months, it is much better than seeking work each week for a few hours or weeks. During a 18 month relationship with them while they could not keep me billable 100% of the time, they hired me to do work worth $125,000. In my desperate financial situation that was a lifeline (I would have needed to sell my house and make other substantial cuts in order to survive).
Unfortunately they have had trouble making timely payments. At any other time, I would not have minded it so much, but due to having no other source of income, having not been paid a penny for nearly six months now has been painful. Because my wife and I are conservative financially and have about $100,000 in an emergency fund (invested in the stock market), we have had no trouble accessing those funds (though, I feel bad to sell my stocks which were doing so well).
Now, after not having paid me about $40,000, the same folks came back to me with a proposal to do another project. At that time, I had no other work coming in but I was also asking whether it is a good idea to dig the hole even deeper by working for them. Thankfully, the payments were made in full two months after I started to do that project but now we are back to not having paid nearly $60,000 for six months. I am wondering if I should decline work from them until they pay off everything and possibly destroy the relationship. It is a tough call. Ideally, I would like to stop working for them altogether till they fix their cash flow problems but I have had so much trouble finding new work because I do not yet have clients. I guess the lesson is that when you are starting out, some of you may have problems like this. Life as a freelancer is hard; I have been feeling low because of this even though I know I should not. I just keep beating myself up for being in this situation that I did excellent work but have to live under all this anxiety because someone refuses to pay me for it. I am hoping that some day I can set more strict conditions that I will stop working if my payments do not arrive on time but right now I fear that in that case due to ample supply of cheap labor they can simply hire someone else.
This is when I hooked up with ex-colleagues who run a boutique consulting firm. The work is interesting but does not pay extremely well. Let us say between $50 and $75 an hour but since the projects last for months, it is much better than seeking work each week for a few hours or weeks. During a 18 month relationship with them while they could not keep me billable 100% of the time, they hired me to do work worth $125,000. In my desperate financial situation that was a lifeline (I would have needed to sell my house and make other substantial cuts in order to survive).
Unfortunately they have had trouble making timely payments. At any other time, I would not have minded it so much, but due to having no other source of income, having not been paid a penny for nearly six months now has been painful. Because my wife and I are conservative financially and have about $100,000 in an emergency fund (invested in the stock market), we have had no trouble accessing those funds (though, I feel bad to sell my stocks which were doing so well).
Now, after not having paid me about $40,000, the same folks came back to me with a proposal to do another project. At that time, I had no other work coming in but I was also asking whether it is a good idea to dig the hole even deeper by working for them. Thankfully, the payments were made in full two months after I started to do that project but now we are back to not having paid nearly $60,000 for six months. I am wondering if I should decline work from them until they pay off everything and possibly destroy the relationship. It is a tough call. Ideally, I would like to stop working for them altogether till they fix their cash flow problems but I have had so much trouble finding new work because I do not yet have clients. I guess the lesson is that when you are starting out, some of you may have problems like this. Life as a freelancer is hard; I have been feeling low because of this even though I know I should not. I just keep beating myself up for being in this situation that I did excellent work but have to live under all this anxiety because someone refuses to pay me for it. I am hoping that some day I can set more strict conditions that I will stop working if my payments do not arrive on time but right now I fear that in that case due to ample supply of cheap labor they can simply hire someone else.