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Setting up a home office is a challenge for many freelance illustrators. That's because it takes more than a laptop and a fax machine to do their job effectively. They also need a drafting table and countless illustration supplies that include paper, pens, pencils and straightedges.
Ideally, a private office inside one's home is the preferred work space for a freelancer. However, if this is not possible, just section off a portion of a larger room in the home. Be sure that a clear separation of household space and work space is apparent.