Increasing numbers of people around the world are working remotely in different entrepreneurial capacities – and many of those are working from home as freelancers.
The life of a freelancer has plenty of benefits associated with it. For one thing, freelancers are able to take on the clients they want, when they want, and can largely set their own hours.
At the same time, though, being a freelancer is not without its challenges – and some of the challenges that affect a large number of freelancers relate directly to good financial management, and good management and organisation as a whole.
Today, there are fortunately various excellent resources available that can shed light on accounting for freelancers, and there are many experts who can advise freelancers on how best to balance their books.
Here are a few financial tips for every freelancer to take to heart.
Set aside as much money as you can, and “budget forward”
The life of a freelancer is naturally quite unpredictable, and the price that freelancers pay for the autonomy they enjoy, is that job security tends to be poor.
Since a freelancer never knows when they will lose a particular client, or when an unexpected expense will come up, it’s very important for freelancers to put aside a substantial amount of their income for unforeseen expenses down the line.
The more you can “budget forward,” and plan your expenses for the upcoming months based on the money that you currently have in your account, the better.
Living pay-check to pay-check is always dangerous, but it’s especially bad in the case of freelancers.
Never rely on just one source of cashflow if you can help it
The best and most established freelancers tend to have a number of different clients who they have ongoing working relationships with, at any given time.
This is certainly one of the key advantages of being a freelancer in the first place – the fact that freelancers can have multiple clients at the same time, instead of being beholden to one “boss.”
This is also a good strategic financial decision, though. If you have one client only, then all your eggs are essentially in that one basket, and your entire financial life is determined by what that client does, and how reliable they are.
To the best of your ability, aim to have multiple different income streams.
Don’t fall into the trap of being fleeced by dubious “mentors”
There are a huge number of different individuals online who are more than happy to try and sell you an expensive training or mentoring package, for any number of different careers and endeavours.
While some of these training courses may be beneficial, many can also be quite exploitative and predatory – they’ll promise you the world, charge you the world, too, fail to deliver, and then blame you for not implementing their training correctly.
As a freelancer, it’s natural that you want to learn as much as you can about how to thrive and to develop your skills, and that you want to identify the best practices to give yourself an “edge,” competitively.
Be careful to avoid being fleeced by dubious “mentors,” though.