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These survival tips are mostly for independent consultant telecommuters, whose income is irregular, unpredictable, and unreliable. You never know when a contract may end abruptly because your client cancels or back-burners a project. You never know when your next contract will start. You have slow-paying clients, and the occasional client who stiffs you. You’re often challenged to show your skills by working on-spec, which might lead to a lucrative contract. Your resources for borrowing money during slow times are very limited. So, how do you cope?

Here are some tricks and tips I learned the hard way.

1. Believe in yourself. It may sound silly, but keeping a positive attitude can keep you going. You present yourself better to prospective clients, so they’re more likely to hire you—without demanding you do spec-work to prove yourself.
2. Believe in universal Karma. Especially when you’re slow or out of work, it’s ok to help others who can’t repay you. Just don’t go overboard and forget to pursue leads. Though the people you help may not be able to help you pay your bills, they can spread the word about your skills and kindness—and that can lead to contracts. I can’t tell you how many times, when things were looking dire, I’ve been surprised by someone reaching out to help me, with a contract or contact. These have always been people I could never repay, and they’ve all said, “Just help someone else when you get the chance.”
3. Don’t put all your eggs in one basket. I’ve known many single-client consultants who ended up in big trouble when that client cancelled the contract. The consultants had no leads in the pipeline, no project work to bridge the gap, and found themselves so emotionally devastated that they couldn’t rally to look for new work. Always try to work for several clients, and have a mix of major and minor projects. Always pursue new leads—even if you have to tell a prospective client that you’ll need a delayed start-date. Most clients appreciate a consultant who’s busy and in-demand. If a prospect thinks you should drop a project to start theirs, just remind them you’ll be as loyal and dedicated to them as you are your current client.
4. Demand a non-refundable retainer or deposit. It’s a sign of good faith, so no legitimate client will be offended. How much you request depends upon the nature of the project. Be sure you collect enough to cover any out-of-pocket start-up expenses you’ll incur; then, find out the client’s payment schedule, and make sure you’re covered at least through the first billing-payment cycle.
5. Clarify what qualifies as billable expenses. Long distance phone calls and travel, even to local client meetings, costs you money. Some clients may pay expenses and mileage; others may pay expenses and let you bill door-to-door travel at your hourly rate. If your client doesn’t want to deal with itemized expenses, make sure you do, and include them.
6. Know your overhead costs. Even though you work from home, you have overhead expenses. Your utilities bills are higher than if you worked in an office, you buy your own supplies, you pay for your own equipment repairs, you pay for your Internet service; and, you pay your own benefits such as health insurance, and retirement savings. Figure out what percentage of your income pays your overhead expenses, then increase your estimates by that percentage.
7. Setup incremental payments. It doesn’t matter whether you agree to bill weekly, bi-weekly, monthly, or based on milestones. Agree to an incremental billing schedule so you’ll get cash infusions periodically. If you agree to milestone billing, don’t agree to subjective sign-off approvals. You deliver the work; you bill. Clearly define how many rounds of changes you’ll make, before you charge separately for them. Intentionally or not, clients are prone to demanding endless rounds of changes before signing-off on a task or project. Don’t let their insecurity and fear of judgment by their superiors be your financial nightmare.
8. Bill clients promptly and regularly. Let me say that again. Bill promptly and regularly! Got it? No excuses! Collecting money is just as important as getting the job done. You can’t keep working if you’re not paying your bills; and, you’ll be distracted if you’re worrying about them. Most corporations pay consultant bills 30-90 days after they’re received and approved. Once you get into the cycle, you’ll get paid regularly—but only if you submit your bills in a timely and regular fashion. I can’t tell you how many former consultants I’ve known, who did great work, but were so sloppy with their billing that they couldn’t sustain their practice. Most of them blamed their “slow-paying” clients; but, the truth was, they were “too busy” to submit regular bills.
9. Make collection calls. You are your own collection agency. Nobody likes to make reminder and nag calls; but, it’s part of your job, so do it! Like billing promptly, you should make your collection calls promptly. Know when your payment is due, then get on the phone if you don’t receive it—and follow-up your call with a dated letter or email. If there’s a problem, get it resolved. Did someone lose or “forget” to submit or sign your invoice? Contact the absent minded party and deal with it. If your client claims cash-flow problems, ask for a partial payment and setup a payment schedule. Hold them to it! Oh yes, and don’t buy the nonsense that you need to finish your project so they can generate enough income to pay you. Stop working, refuse to deliver anything you’ve done, and cut your losses. You won’t make friends doing this; but, you might just get paid to at least deliver what you’ve already completed.
10. Cash your payment checks promptly. Don’t let them sit around. Clients get rightfully irked when consultants lose payment checks and they have to be reissued. Expect long delays for reissued checks.

Ok, so that covers the times when you’ve got some work. How do you cope with several months of no work and no income?

1. Keep a belt-tightening list. Know which luxury expenses you can trim during no-income periods. Little things add up. Switch from your favorite brand-name to generics and store brands. Use coupons whenever you can. The more you practice belt-tightening, the better you’ll get—and you may well find that you continue some of your thrifty habits.
2. Eat at home. Dining out is expensive; learn how to shop for and prepare basic, inexpensive meals. You can make lunches for a week, for the price of one dinner out.
3. Drive economically. Think ahead and consolidate your errands into a single loop, even if that means staying home one day and driving the next.
4. Conserve utilities. Turn off unnecessary appliances, including your computer overnight. Set the thermostat to use less heat or air conditioning. You don’t have to get yourself sick, but a few degrees can reduce your bills.
5. Get creative. You’ve got the time to collect accumulated clutter and have a tag sale, send it to auction, or sell it on eBay. Worst case, donate your junk and get a receipt for tax purposes.
6. Park your ego and think of ways to sell your skills to small businesses or individuals, then advertise along with the gardeners and babysitters in that free weekly paper you usually toss. Expect to charge these clients much less than your regular rate. Can you write resumes? Setup and fix computers? Teach software programs? Sew? Mow lawns? Walk dogs?
7. Practice the buddy system. Whether it’s your spouse, your roommate, a family member, or a true friend, establish a relationship and understanding that there may be slow times when you’ll need financial help. Then, keep your buddy updated, so he or she can anticipate and plan.
8. Know which bills you must pay. Though your creditors would disagree, some bills are more important to pay than others. Try to pay something on all your bills every month, so your creditors know you’re making an effort.
9. Don’t be too embarrassed to get help. Everybody goes through hard times, and there are many local agencies that can help you identify resources, and programs for which you qualify. Start with your town’s social services department, and let them direct you. Reaching out for help, however painful, can get you back on track quicker. You're not freeloading; you're going through exactly the type of situation these agencies and groups were established to address.
10. Consolidate your debt. If you’re really in trouble, get help with debt consolidation.
11. Finance yourself. Though the financial experts discourage them, consultants have used all of the following resources to keep themselves afloat during no-income periods, after they’ve exhausted their savings. I’m not recommending any.
    - Equity loan or line of credit, if you own a house—just be sure you get approved before you need it.
    - Credit cards, a dangerous choice except for bridging short-term income gaps.
    - Loans from friends or family, which often result in hard-feelings that linger long after you repay the loan.
12. Get a job. I don’t mean a full-time job with benefits and a career path; I mean a part-time or temporary job to tide you over. Maybe you can work a couple of evenings at your local mega-store or fast food restaurant, and keep your days for prospecting. Register with a temporary employment agency. Short term assignments can keep you afloat and help you make contacts that can lead to contracts.
13. Volunteer. You’re likely to meet people who can help you; and, just getting out and doing something useful will help keep your spirits up.
14. Stay in touch with friends, colleagues, and family. These are your life-lines; without them you’re bound to fall into deep depression—which can cripple your prospecting skills. Ask them to help scout leads for you.
15. Make new friends by joining online telecommuter groups. Most are free to join, and members know how to help you weather the stormy times. Members can also point you to helpful online resources for client and job hunting.

Every telecommuter goes through dark gloomy days, when there’s no work and no income. You can survive them!

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