Career Change Trends: 10 Million Americans Embrace New Paths

It's a change you may want to embrace as well.

The coronavirus pandemic has inspired a lot of people to rethink their job situations. And while some workers may be extremely grateful to have a job in the first place, others are looking for new opportunities.

If you're unhappy with your job, you may be ready to dust off your resume and apply to other companies. But what if you could be your own boss instead?

It's not such a crazy idea -- a recent Upwork survey found that 10 million Americans are considering going freelance. And there are benefits and drawbacks to going that route.

The upside of freelancing

When you're a freelancer, you call the shots. You don't have to report to an office at a specific hour or work a specific number of hours each week. Rather, you set your own schedule and do your job when it's convenient for you. If you have young children at home, going freelance could even save you money on childcare.

Not surprisingly, of the 10 million Americans considering going freelance, 73% cite the ability to work remotely or maintain a flexible work schedule as a reason. And that flexibility could lead you to a better work-life balance.

Another great thing about going freelance is that you may make more money independently. As a freelancer, you give up employer benefits like health insurance and access to a 401(k) plan. But if you're married and able to get health insurance through your spouse, and you open an IRA for retirement savings instead, that won't be a huge loss. Meanwhile, because freelancers aren't entitled to benefits, they frequently command a higher hourly rate or project rate than salaried workers.

The downside of freelancing

On the other hand, being a freelancer means no longer collecting a steady paycheck. You may have a week when you earn plenty and another week when you barely earn any money. That could make it difficult to pay your bills.

If you're considering freelancing, make sure you have a financial cushion in your savings account for when your workload declines or clients take longer than usual to pay.

Another drawback of freelancing is that you aren't eligible for paid time off. Granted, you can take vacation days whenever you want. But if you get sick and can't work for a week, you aren't paid for that time.

Finally, if you're single and can't get health insurance through a spouse, you still need coverage. You can purchase a marketplace plan, the availability of which depends on the state you live in. Depending on your income, you may be eligible for a subsidy to offset the cost of buying insurance, but it could still be a huge expense to tack onto your budget. And since you may earn less as a freelancer until you've built up a steady stream of income, that could cause you a world of financial stress or even drive you into debt.

Should you consider freelancing?

If you're looking for a job change and hope to carve out more flexibility for yourself, going freelance could be worth pursuing. Just make sure you have decent time-management skills before diving in.

When you work for yourself, you don't have a boss breathing down your neck. That's a good thing and a bad thing. The key to doing well as a freelancer is being productive and making good use of your waking hours. As long as you possess those skills, there's a good chance the freelance lifestyle will work out nicely for you.