When you are a freelancer, you also need to think about your financial stability. Some freelancers, especially those who are just beginning to find their career in the freelancing world, are sometimes struggling to manage their finances. The sad truth is, some of them don’t have regular projects which also means that it is affecting their income. Although they choose this path so that they own their time, it still brings them financial inconvenience.
It is essential to take note that not all freelancers are gifted to have a regular income. It is the primary reason why they should be prepared for their future if they want to live a sustainable life. It is not a bad career after all.
Freelancing still gives them a sense of accomplishment in a way that they can freely express their talent and skills by being their own boss. The ups and downs in this field are inevitable, so freelancers must financial stability all the time.
Save, Save, Save
Since you are the CEO of your job, you must also think that part of being your own boss is managing your finances as well. Whether you like it or not, you also need to face this part of your life that you have to count your money and set aside some savings. There will be months that you will earn a hefty amount of money while there are also seasons where projects come slowly.
Being said, you have to treat the productive months as a chance for you to set aside some of your earnings. Doing so can help you prepare from the financial issues that you may face when only a few projects arrive. Although your earning is growing year by year, you still need to have a mindset that slower months are inevitable.
But what if your savings is not enough for an emergency need? Then you can opt to get a quick cash loan from a reputable licensed moneylender. Ensure that the lender you choose has a legit license to avoid getting deals with loan sharks.
Separate Personal and Business Finances
It is also crucial if freelancers separate their personal and business finances. Let’s say you are paying for a premium app that you use for graphic design. You also need to pay for the subscription of accounting software that you use to invoice your clients. At the same time, you have personal finances at homes such as food, electric and water bills, and groceries. Doing so will allow you to track the most important expenses that you have to prioritize, and minimize the things that you don’t actually need.
As for millennial freelancers, tracking your spending will help you highlight the areas where you waste more money.
You could imagine that you could instead put it in your savings account. If you are busy sometimes or money management is not your cup of tea, you can use some apps that can help you categorize your expenses and track them for you.
List down your purchases and payment you receive. Then, the app will then do the rest of the computation for you. It will give you an insight into how much you make or there is something from that list that you need to eliminate to balance your finances.
The technology has a plethora of ways to give you what you need, so try to take advantage of these benefits. In that way, you can focus more on freelancing and you can schedule a weekly or monthly check-in for you to see if your finances are running smoothly.
Multiple Savings Account
It is also crucial to segregate your income into a different savings account. Create one for your emergency expenses (medical or hospitalization), living expenses (food, water, and electric bills), and savings.
Of course, don’t forget to get one intended for your retirement. Think that you won’t be freelancing all the time. Also, welcome the thought that retirement age must come and it is inevitable. Whether you like it or not, time will come that you won’t be fully capacitated to do the same skills and talents that serve as your bread and butter right now.
Being your own boss is one thing that almost everyone dreams to be. Included in freelancing is a responsibility to manage money efficiently, or else, you will end up with empty pocket when you grow old. Although you have creative and artistic skills, you cannot avoid the fact that you must also learn to control your expenses if you are determined to have a healthy financial living.
Money management doesn’t need to be a burden for freelancers. It is just a matter of prioritizing the things that your business needs to grow while making sure that you meet the basic necessities that you need every day of your life.
Since freelancing is your life, it is also great to see the product of your hard work. You must not live to work, but rather, work to live. Let it be your mindset and you will proactively do the things which you know can help you reach your goals.