Remote Work

Remote Vs. Freelance: 4 Differences & Which One is Right for You in 2022

Thom Brown

by Thom Brown

The work from anywhere movement is exploding around the world right now, but there are different terms you may have come across. Remote work is a common one, as is freelance work. Sometimes, these two words are used interchangeably. While they have some crossovers and similarities there are also a few differences between the two.

A remote worker is someone who has location independence, meaning they can work from home or while they travel. A freelancer is someone who is self-employed and hired by various clients to complete certain projects. Below, you’ll find the four major differences between these styles of working, helping you decide which one is right for you.

Length of the Contract

Remote workers tend to work full-time for their company, meaning that they’re usually employed on a permanent basis. Freelancers, conversely, will work on individual projects and may not be required once the project is completed. That means that a remote worker’s contract will usually last a few years at least, while a freelance worker may only have contracts that end within a few weeks or months.

For some people, these short-term contracts can feel insecure. They’d rather have their future mapped out so that they can plan ahead. However, those drawn to the freelance lifestyle often find that they like the variety of constantly changing companies and working on different types of projects. If you’re successful as a freelancer, you can line up many projects in a row so that you know you have a stable income for the next year or more. This does carry risk, though, since companies may pull out at the last minute.

Working From Anywhere

Both freelancers and remote workers may be able to take advantage of the work from anywhere movement. However, freelancing doesn’t guarantee this. A remote worker, as the name implies, doesn’t need to attend the head office to do their job. Therefore, they’re generally free to travel the world and set up office wherever they see fit. A freelance worker, on the other hand, may have to attend meetings and be on-site for the duration of the project.

Many freelancers are able to work from anywhere and they have the freedom to only choose the projects that allow this. However, taking this approach can lead to fewer opportunities. In many cases, finding local companies within commuting distance offers more projects and ultimately more income for the freelancer. As remote work becomes more accessible, though, many companies are happy to allow their freelance contractors to work remotely, even if the rest of their workforce doesn’t have this luxury.

Employee or Entrepreneur?

Most remote workers are an employee of the company for which they work. Therefore, they aren’t self-employed and have to report to their bosses. This also means that they’ll pay income tax, which will generally be taken from their monthly paycheck. A freelancer has the bragging rights to call themselves self-employed. They’re their own boss, meaning they have the right to refuse projects as well as complete control over their schedule.

A freelancer has to act as an entrepreneur. This means being responsible for filing their own taxes and taking on the risk that comes with investing in your business. This also means a greater degree of freedom and limitless income potential. However, it comes with a great deal of responsibility, not to mention the risk of a downturn in the economy affecting sales. This can add extra stress but for some, the rewards are worth it.

Benefits Available

The other advantage of being an employed remote worker is that you have access to all the benefits that come with working for a company. You’ll receive sick pay, maternity leave, public holidays, health insurance, retirement packages, and anything else your employer decides to offer you. This can make you feel much more secure in your work, allowing you to achieve your potential without experiencing burnout.

Freelancers don’t have this luxury. In many cases, if you’re a freelancer and you take a day off, then you simply won’t get paid. You’re paid solely on the work you complete, unable to claim sick pay or have access to other company benefits. These are reserved for people working within the company and not afforded to third-party freelancers. This option doesn’t allow you to take equity, but it does enable you to grow your own business and invest some of the profits in health insurance, retirement funds, and similar benefits.

Which is Right For You?

Being a remote worker is more like traditional employment. You’ll have all the security of working for a single company and can enjoy the benefits that come along with that. On top of this, you’ll have the ability to travel the world. That’s why many consider it a win-win situation. However, you’ll also have all the constraints of working for someone else and may not have much control over the hours you work.

Becoming a freelancer means going self-employed and adopting an entrepreneurial mindset. It comes with all the risks of running your own business, filing your taxes, and finding enough work to remain financially secure. However, it also means a life of complete freedom and independence. You’ll be able to choose which projects you take on and pursue the work that you find genuinely meaningful. If successful, there is a far greater earning potential from being a freelancer, but this is far from guaranteed.

For many workers, it might be best to begin by moving into remote employment. This gives you a taste of freedom and helps you build up your skillset. You’ll still be connected to a company offering a regular paycheck and financial security. However, if you work hard, then you may find that you outgrow your role. You’ll begin to take on some freelance work on the side and may find that clients are willing to pay you a lot more money for doing more exciting work. As you start to build up a regular stream of clients from your Anyplace Select home office, there may come a moment when you decide to quit your remote work job and focus on becoming a full-time freelancer. 


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Thom Brown

Thom Brown

Author

Born in Oxford, UK, Thom has been a digital nomad since graduating from the University of Sheffield in 2016. He’s a freelance writer and founder of Thom Brown Travel. Thom specializes in minimalist, ethical, and meaningful travel writing.

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