About half of my career was in freelancing or consulting and the other was being employed by a company.  Some of the most frequently asked questions I get, especially during this economy, is "Is it better to freelance or work for a company?"  "Which is more stable?"  "Which do you earn more in?"  You'll be surprised by what I have to say about both.

 

Foremost, the answer really has to do with career preference, the context of the questions you're asking, and circumstances.  If you're thinking schedule wise, financially wise, or stability wise, it really depends on the situation, who your clients are or who you're working for.   Also, keep in mind the legal definition of freelancer vs employee.

When you freelance, you are responsible for obtaining and keeping clients.  When you work for a company, generally that company may handle all the client relations.

Freelance

Pros:  You get to choose who your clients are.

Cons:  It may be challenging finding, obtaining, and keeping clients on your own, especially being in high competition.

Employee:

Pros:  With exception of commission based (e.g. Sales), your boss and company generally takes care of client leads.

Cons: Regardless on how difficult and demanding the clients are, you may have to be "stuck" with them.

When you freelance, you generally choose your hours of when to work, and vacation time.   When you're an employee, you generally stick to their schedule you agree upon.

Freelance

Pros: You make your own schedule.   Flexible.  If you like to work at night, you can.  If you want to take a vacation or personal time off, you can.

Cons:  It may be challenging to stick to schedule.  It's easy to procrastinate.  Sometimes depending on the load of the work you find yourself working odd hours or many hours to meet client needs.  You will also have to manage around your schedule, your client's schedules and between multiple clients' schedules.

Employee:

Pros:  You may like the 9-5p type scheduling where you go to work then go home without having to continue or think of work.

Cons:  Employment doesn't guarantee a regular work schedule, depending on what job, you may end up working having to stick to odd hours for 40+ more a week or much more hours than initially mentioned.  As a person on salary, this is a great disadvantage as you don't get paid overtime.  In addition, you have to work with the company schedule, your vacation/personal time is limited.

As a freelancer, you can set your own rates for clients, while as an employee, you earn a negotiated fixed hourly or salary (until the next raise).

Freelance

Pros: As a freelancer, you're in control and responsible for your finances and you set your own rates according to project.  Your rates are generally x amount higher than what you would normally make as an employee.  The reason why you can charge much more is that you owe much more in taxes than an employee, and may have a lot of business expenses.  But if business is going extremely well, you can make much more of a living than being an employee, create jobs for others, and be a great influence in business.

Cons:  If you're a business owner, finances can be tough or easy to slip, so you are likely to need to hire professionals to handle that.  It also can be challenging to decide what rates are best for the value, competition, etc.  It has its ups and downs, the amount of earnings may be inconsistent, possible periods of no income, and is based on how well you do.  If you hire employees, you are responsible for payment in unemployment insurance, taxes, benefits, and all expenses necessary.

Employee

Pros:  If company sticks with you and you stay, your earnings can be more stable and consistant.  You are not responsible for the percentage of tax that your company and freelancers have to pay and you may receive excellent benefits.  Sometimes if your company provides bonuses and stock options.

Cons:  Your income may be fixed for awhile until the next performance review.  Usually a year.  Each year the raise may be a small increase and there's a possibility you won't earn that much if you accept low pay.  The amount you make may not be not enough for retirement, and you may need to have another source of income (another job or freelance) to make up for it.  Also nothing is 100% guaranteed stable, any at-will companies can terminate you or your position for any reason also, businesses sometimes collapse and you get laid off, so if you are dependent their benefits, it may be drastic for you to lose it.  If that is your primary and only source of income and insurances, it may be a struggle going through the process of unemployment, find another job, and insurances.

As a freelancer, you choose where to work vs employee requirements are usually where you're assigned to.

Freelance

Pros:  You can work from home, coffee shop, or sometimes clients has office space they are willing to share, if you prefer, instead of having someone assign you the desk/cubicle you'll be staying at xx amount of time. 

Cons: Depending on situation, working from home can be distracting and less productive.  Not having an office sometimes makes it feel like being all over the place if you prefer one spot.  For some people, it's challenging to work from home and communicate via electronically.

Employee

Pros:  You have an office.  You can work with people in person.  Often it's much easier and less miscommunication than electronically.

Cons:  If you don't like your office, desk or cubicle, you're typically stuck there.  Sometimes there are travel requirements you may not desire.

Remember, it all depends on your situation.  Each detail can vary.  Nothing is 100% guaranteed stable, so what I recommend is to think about your future, and back up plans to have enough to provide for you and those in your life.  Don't assume you're going to be guaranteed your job for a long time or forever (I thought that, and it didn't happen).  That's why I consider both freelancing and employment.  If you need to provide for others immediately, taking whatever decent, stable full time job, is a good idea, or multiple part time jobs.  If you're currently in a full time job, freelance on the side whenever you can so that you have other sources of income.  But remember to not get burnt out relax a bit and live a bit.

Good luck!