I was aslo willing to do a couple of projects in the beginning either for dirt cheap or free just to have a couple of reference customers--I found that trying to get a customer to pay for my service when I had no track record was difficult.
One thing I think I did (I was doing software development) as a consultant was to form an company (C-corp, since I planned--and did--to grow and hire on staff) was get insurance. In 2001, $1M insurance cost about $4K if I recall correctly. That was an added piece of mind to customers.
In terms of time management, you have to be careful. Back then, I didn't have a family, so coding during dinner time or late into the night wasn't an issue. a wife and kid later, that changes. Any consulting I do now is after the little one goes to bed and or on weekends.
Best of luck!