It seems like nobody talks about money, am I right? Which I totally get – it’s not an easy thing to talk about publicly. But looking back on my first days in business, I know that I would have benefitted so much from an honest conversation about money. Well today I’m gonna get really vulnerable with you all, so here we go.
Quarter 1 of this year was my most successful quarter ever. I’ve actually made more money since January than what I made all of last year, which is crazy. Now a little disclaimer, I made VERY LITTLE money during my first 2 years in business. There are lots of reasons for that, so I’m gonna walk you through what I made each year.
But before I do that, I want to explain how our situation has influenced my income because I think it’s important. We move around every year for my husband’s job (he’s a professional basketball player). The basketball world is a very unique one. Whenever we move to a new place, my husband’s team takes care of most of our necessities – our visas, an apartment, and usually a car. So during the season, we really don’t have many bills to pay. And in the offseason, we usually just stay with family since we don’t know when we’ll have to leave again. All of this has been a huge factor in my own money mindset. Most young freelancers have to ease into things slowly and save up as much as they can before going full-time, but I didn’t have that option. Instead, I was fresh out of college with no connections and barely any money saved up. BUT because of our unique situation, I didn’t have the pressure to make a ton of money right away and I’m so so lucky for that. I was able to grow my business slowly and you’ll see that reflected below.
- 2016 | This was my first year and things were SLOW. I had no clients lined up and it was a struggle trying to find work. Those first 3 months were mainly spent building my online presence and figuring out how to run a business. I ended up only making about $4,000 between June and December. But since we didn’t have many bills, that wasn’t a huge deal for us.
- 2017 | This year was interesting because I was starting to attract clients consistently, but I still wasn’t making much money. I raised my prices a bit, but it wasn’t enough to keep building. After expenses, I made about $9,000 and was able to live comfortably off of that.
- 2018 | I kept inching forward and finally started to see real grown in this third year. I raised my prices again and it was probably around August or September when I really started to feel confident in myself as a business owner. After expenses, I made a little under $13,000 for 2018. That’s still really low, but it was a huge accomplishment for me considering that I started from the bottom (probably as low as you can be haha).
Not many people would want to share exact numbers like this, especially when they’re so low and, honestly, a little embarrassing. But I really want to get this across – starting a business is HARD. And starting a business straight out of college with little experience and no plan is EXTRA HARD. There’s a good reason why the majority of people ease into this job and if it weren’t for our unique situation, I probably wouldn’t have been able to do this.
Starting a business is HARD. And starting a business straight out of college with little experience and no plan is EXTRA HARD. There’s a good reason why the majority of people ease into this job and if it weren’t for our unique situation, I probably wouldn’t have been able to do this.
Now let’s talk about 2019! We just finished quarter 1 and guys, things look SO different for me. After expenses, I’ve already made $16,000 this year. My bank account is bigger than it’s ever been and that’s exciting, but honestly, it’s a little scary too. I had gotten pretty comfortable with the fact that I didn’t need to make a lot of money. It seemed easier because in my head, more money meant more responsibility. More possibilities for spending money, more opportunities to make bad decisions, more pressure to keep making more and more. And that’s where money mindset came in – I truly think that I was scared to make good money for those first 2 years.
I truly think that I was scared to make good money for those first 2 years. In my head, more money meant more responsibility. More possibilities for spending money, more opportunities to make bad decisions, more pressure to keep making more and more.
But last December was a turning point for me. I realized that if I really wanted to grow Wayfarer the way that I knew I could, I needed to make some changes + shift my money mindset. Here are the things that I changed + how they effected my wallet:
- I raised my prices. I’ve always charged the bare minimum that I was comfortable with and here’s the bottom line – pricing yourself competitively can be a dangerous thing. I feel like we’re made to believe that this is all a competition and we need to charge based on what we think will land us the most projects. But that approach can lead to booking clients who don’t really value your work, which you should avoid at all costs. As I’ve gotten more experience, my perspective on pricing has started to shift from ‘How much money are other people charging and how can I compete with them? How many hours will I spend on this project?’ to ‘What is the value that I’m offering to clients and how much money is it going to be worth to their business?’. I think there comes a point in every business owner’s career when they stop selling themselves short and start really owning the value that they offer. Aftery 3 years, I think that I’m finally there. There are so many tips that I could give on how to price yourself, so I’m going to save that for a separate blog post that’ll be coming soon, so stay tuned for that!
- I set up payment plans for my clients. I used to split projects into 2 payments — 50% before, 50% after. That’s pretty standard and is what I saw other designers doing, so I just assumed it was the best option. But for longer projects, that can be a really long time to go without getting paid. My brand + web projects last about 3 months, and if I book them a month in advance, that means I go 4 months without getting any money. My back account was starting to feel so sporadic and it’s hard to save money without consistent paychecks. But I had a designer friend suggested that I start doing payment plans back in December and it was seriously a game changer! Now, I ask for 25-50% deposit up front (depending on the scale of the project). Then I split up the remaining percentage into 3-4 payments spread throughout the project. This way, it feels more affordable to the client AND I get paid more frequently.
- I launched a course / passive form of income. This was definitely the scariest thing that I did, but I’m so so glad that I went through with it. Passive income is huge and if you can find something valuable to offer that you enjoy doing, go for it! I suggest examining the things that you’re already doing as a part of your regular process and see if there is a way to turn any of that into a sellable resource. That way you aren’t necessarily creating something from scratch, but already have a foundation to build on. It makes the course/product creation stage a lot less stressful.
These 3 things made the biggest difference for me and triggered the big financial growth that I’ve seen so far in 2019. I have no idea how much more I’ll make this year. I’m planning on raising my prices again soon because I’ve been booking out consistently. (Someone once told me that if you book 3+ clients in a row really quickly, that means you’re in high demand and should raise your prices, so I’m taking that as a sign.) I’m also re-launching my course this summer, but this time it will have some evergreen products that I’m hoping will do well and give me more passive income. And finally, I’m about to start outsourcing all of my web development which I’m hoping will ease my workload and allow me to take on a higher volume of projects. Lots and lots of changes, but all good things happening 🙂
Few people talk about money, especially this openly, and that’s exactly why I wanted to share this post with all of you. I barely made any money during my first 2 years and I think that’s important for other young designers to know. It’s normal to grow slowly! And it’s not just about knowing business stuff, it’s also about your mindset. I wasn’t making good money because I was scared of the responsibilities that come along with it. Hopefully that realization is helpful to you if you’re currently struggling to make what you want.