6 Money Management Tips for Freelance Content Creators
Freelance content creators make money from their work by selling it to others. This is a great way of making extra income, but there are some things you need to know before starting out as a freelance writer, graphic designer, or any content-creating job. Here are some money management tips for freelancers that will help you get the most bang for your buck and keep you on track with your finances.
Determine Your Budget
One of the common challenges for freelancers when it comes to money is that they don't have a steady source of income. They may earn a lot of money in one month, then nothing at all in another. If this sounds familiar, you're not alone! It's important to set up a budget so you can see where your money goes each week/month. You'll be able to plan ahead more effectively if you do this.
A good step to setting your budget before you begin freelancing is to determine all your fixed expenses. You should include rent/mortgage payments, utilities, bills, groceries, and more. Once you've determined all of your expenses, set a budget that you are comfortable with. You should also remind yourself to stick to your budget so that you won't spend too much money.
Track Your Expenses
It's easy to forget about how much we spend every day until something happens like an unexpected bill pops up. To avoid forgetting anything, use a simple spreadsheet program or mobile app to record everything you spend. Track everything from groceries to equipment you use for work.
This way, you don't have to rely solely on memory to figure out what happened over the past few weeks. Instead, you can easily look back through your records and find out which purchases made sense and which ones didn't. By tracking your spending, you'll be better prepared to manage your money once you start earning additional revenue.
Save for Emergencies
Since freelancing is unpredictable, it's important to save enough money to cover emergencies. An emergency could mean losing your car due to a flat tire or having trouble affording gas while traveling. These types of situations aren't uncommon for many people who choose to become independent contractors. In order to prepare for these kinds of events, consider opening a high-yield savings account since they can have interest rates ranging between 1% - 3%. The higher rate means that you'll receive more money than you would with traditional banks.
Have a Bank Account for Your Freelance Work
Opening up a separate bank account for all things work-related can help you manage your finances better. This includes any freelance projects you take on, invoices from clients, and even business cards. A dedicated bank account allows you to keep track of your business' transactions without worrying about them affecting your personal life. It also protects your personal finances from any financial problems related to your business.
Don’t Forget About Your Taxes
Since freelancers usually don't have employers, they have to pay their taxes on their own. It's important to be familiar with the tax laws in your state. One way to not worry about taxes when working independently is to immediately set aside the appropriate amount you need to pay for taxes into a separate account. This helps you stay organized and ensures that you have money to pay for your taxes.
You can also hire someone who specializes in accounting services. These professionals can handle all aspects of your finances, including preparing your federal and state forms, calculating your deductions, and even helping you prepare for audits.
Explore New Opportunities
It doesn't hurt to explore new opportunities when they arise. As a freelancer, you never know where things may lead, so take advantage of whatever comes along. Whether it's starting a side business or taking part in online courses, there are plenty of work-from-home opportunities available if you keep your eyes open. These can help you earn extra income without sacrificing too much from your current lifestyle.
Don't be afraid to negotiate better rates either. Do some research and find out what other companies charge for similar tasks. Once you figure this out, you can ask for a higher rate for your work -- who knows, maybe you'll get lucky!
Meet the Author, Sophia Young
Sophia Young recently quit a non-writing job to finally be able to tell stories and paint the world through her words. She loves talking about fashion and weddings and travel, but she can also turn out a thousand-word article about the latest marketing and business trends, finance-related topics, and can probably even whip up a nice heart-warming article about family life. She can totally go from fashion guru to your friendly neighborhood cat lady with mean budgeting skills and home tips real quick.