To any person, getting started as a freelancer can be exciting but also scary, at the same time especially when it comes to managing your money.
You may be wondering how you will know how much money to charge clients, what taxes and expenses you need to track, or how you will get paid and when. In this article are tips that can help manage your finances and make you more successful as a freelancer, so stay tuned.
What is Money Management?
Money management generally is simply figuring out how to spend your money wisely and make sure you have enough to cover your bills, living expenses, etc.
Here are some tips for managing your finances and staying on top of what’s going on in your freelance work or game whichever you like to call it.
Tips for money management as a freelancer
1. Keep track of your finances
As a freelancer you often have to keep track of your finances by yourself, which can be difficult when the business is your side hustle, although it really is difficult by keeping track of your expenses you get to manage every penny that enters your purse as a freelancer.
2. Have a budget
Creating a budget is one of the most important things you can do for your business, especially if you’re a freelancer, as you are a freelancer, a budget not only helps you know how much money you have coming in and going out each month, it also allows you to see what areas are more profitable or need more investment. Also, you need to budget for proposal software which can also create invoices and sign contracts.
If something goes wrong with any part of your budget, then other aspects of it will need to be adjusted accordingly, that’s why it’s so important to maintain an accurate and realistic monthly budget.
3. Invest in yourself
Investing in yourself is one of the best ways to maintain financial stability as a freelancer, it is one of the most important things you can do for your small business as a freelancer just set aside some money for professional development; like maybe to take an online course, attending conferences or seminars, or participating in industry-specific events.
By doing so you’ll be able to learn about the latest trends, network with potential clients and contacts, and get inspired to think outside the box with new ideas.
4. Train Yourself to have self-control
As you are freelancing there it is very easy to spend money anyhow when you get it, but if you want to be successful, start training yourself to have self-control.
This means that even if you have the urge to buy something, wait for at least 24 hours before making the purchase. By doing so you will be surprised how many extravagant things you will avoid getting through your freelancing money.
5. Have an emergency fund
It’s important to have an emergency fund of at least three to six months’ worth of expenses cause you can never know what might happen, so it’s better to be safe than sorry.
If you are having trouble paying your bills each month as a freelancer, you should consider seeking help from a counselor that specializes in such matters, or even opening up a separate savings account for unexpected emergencies, you don’t want to find yourself homeless and penniless if something were to happen.
Why do most freelancers fail?
The main reason freelancers fail is due to a lack of time discipline and because they are unable to plan their time properly. This is what leads to them not knowing how much money they make or how many hours they work on a project, which can make it hard for them to budget and plan for the future.
Freelancing is an excellent way to make money if you’re willing to put in the time and effort, however, the advice outlined above is just to help you be more productive and manage your finances betters, so you should try to adhere to each of the tips stated above to avoid loosing and going broke in the future as a freelancer.