Maria Peloponisiou~ 5 min Reading time | 06. Sep 2019
Freelancing is great; besides the long hours of hard work in the end, at least you got some penny rewards to look forward to. Nonetheless, most freelancers frequently find themselves in unique situations. You’d find that some have let go the mental peace that comes with consistent monthly cash flow, for the privilege of working for themselves. When it comes to save money, freelancers go through a great deal to make ends meet, and that’s one thing we all need to appreciate.
This begs the question, can a freelancer be in a position to formulate a working budget and abide by it. This is keeping in mind that freelancers usually don’t have a steady cash flow and are most times not aware they’ll earn monthly. There’s a straight answer to this, and that’s a definite Yes! However, this doesn’t come as easy as it sounds. For freelancers, it calls for some whole another level self-discipline to realize this. To assist you with that, our team has come up with some quick hacks to help you through this entire process of money discipline.
With us is a guide on how to save money wisely as a freelancer. This is all to secure both your emergency slush expenses and long-term savings
Wise Money Savings Hacks for Freelancers
These are some working habits that if you practice and emulate, you’re looking at excellent benefits in the long-term:
The unsolved problem among many freelancers is the idea that they can do everything. Well, this isn’t the case for many freelancers are having sleepless nights for not knowing how to save money. We get it, and nobody is here to dispute you can’t do everything. But if you are reading this, it means there’s trouble in paradise. The idea of accomplishing everything and still finding time to attend to your favourites is something we ought to look into with great concern. For the simple fact that it’s impossible, you’re human, not a robot, and even a robot creates time to recharge. The day doesn’t offer them enough time to accomplish all that and still find free time to do the things you enjoy.
If at all you want to free up time to attend to other life matter or take up a higher paying job, then outsourcing is your silver bullet. Nonetheless, there’s a catch with outsourcing as you might end up spending more. Outsourcing requires some proper vetting to finally settle for sources that work with your specific income flow. There are sites on the internet you can sign up for and get quality services without having to pay much.
Plan for Your Money
The moment you hear this, what immediately comes to your mind is a budget. It doesn’t necessarily have to be a budget. The main idea is for freelancers to have a working plan on how to spend their finances. It’s more or less of mental conditioning whereby you assign specific income streams for particular goals. This can range from paying debts to feeding your saving account or save for the upcoming holiday vacation to Thailand. Whichever the case, a working financial plan based on your income streams is fundamental.
There’s a bright side to this besides the hard work that you’ll have to put in. In the long run, you’ll develop an admirable financial discipline. And this will mean not spending on unnecessary stuff hence money wasting.
Save Money for Retirement
More often than not, the subject of saving for retirement is often overlooked, but it’s a fantastic strategic plan. For most freelancers, it sounds odd, who are looking to save money they’re looking to spend many years from now. And what about living in the moment! This philosophy is to be dropped immediately if you want to make some notable progress with your financial habits.
Putting aside some money for your retirement days is something hard for many, considering the many short term goals you have in mind with the extra finances. Saving for retirement with money from your freelancing has with its significant advantages. One you will be able to have additional funds for ultimate comfort in the event anything happens. Better yet, if you have a personal pension plan or something similar to that. You will be in a better position to enjoy the benefit of the tax deduction for the yearly contributions. Well, how’s that for killing two birds with one stone!
Keep Major Expenses Low
Back when you were a full-time employee, you had the benefit of a fixed monthly income. From whereby you stood, you were in a position to evaluate the leeway you had when it comes to luxury and nonessential spending. And now that you’re in the freelancing front, things are a bit different, and this calls for you to cut down on your expenses.
The goal is to save money, and one way through this is to keep significant expenses low. Which are some of your principal monthly payments, of course starting with housing which cuts across many freelancers? Make an effort and cut on your monthly payments. You’d opt for maybe a double mortgage for your house, but you’d rather keep your costs low to have some money left for savings. The same applies to other expenses, like transport. In the long-term, you’d appreciate that keeping your costs low helps tone down the overall spending cost and hence free up money for saving.
You might start throwing jabs at us for telling you to spend money. And just it sounds here we go again “Spend money.” At least this time around the phrase is quoted. This perfectly fits the idea we’re looking to put across. The freelancing business is comprehensive and competitive, for one to grow and gather more clients, you ought to spend. Look at it in terms of ‘using the money to get money.’ You’ll need to invest in your work and perhaps turn it into a full-fledged business that should get you positive feedback.
The main issue comes with deciding what to spend on. The focus needs to be on things that should get you the highest Return of Investments possible. Based on your working freelance niche, you can evaluate and choose areas to spend on. While at this, you can as well seek for professional advice to avoid making regrettable decisions.
There you go, money-saving skills you need to practice and make a habit of them. We get it, and it’s not easy managing your finances when having unsteady monthly cash flow. But you have to work around it and abide by your plan.
How do you allocate specific finances based on your income streams?