Smart Budgeting Tips For Freelancers

Working as a freelance designer affords you an incredible amount of flexibility in how you live your life. You can usually work when and where you want, earn as much (or as little) as you wish, and, within reason, pick and choose the clients you work with - firing the ones who don't suit you.

The unfortunate downside to working as a freelancer is that your income is never, ever guaranteed, which means that budgeting, and saving money where you can, should be central to your overall business plan. The reality is that your freelance income could disappear overnight, so being proactive in managing your finances is simply good for business - your business!

Need Vs Want

In as much as this should be taught to children from the age of 5, it's still something most people don't figure out until they're in their 20s or 30s. The simple fact is that there are some things in life that you want, and there are certain things you absolutely need. For example, your current laptop might be a few years old but does exactly what you need it to do. Your best buddy, however, has just splashed out 3 grand on a new Mac. You'll want a new Mac, but you definitely don't need one. The quickest way to wind up living on Ramen noodles for an entire summer is to spend money on something you don't need.

Assume Nothing

You know that client who promised you 6 months' worth of work, with great pay and a flexible schedule? Don't believe a single word he or she says until you see money in your bank account. In fact, you should doubt absolutely everything you're told by any client, because that will stop you suffering from shell shock when they suddenly stop paying invoices, and their email address goes dead. It's not that all clients are "bad", but any freelancer with a scrap of sense knows that clients can and do change their minds all the time.

Embrace Freebies!

Yes you can go out and spend $297 on the latest and greatest WordPress theme framework, or you can spend 2-hours customizing a default theme to get it doing exactly what you need it to. Approach problem solving from a financial point of view, eliminating expensive software purchases unless you have no other choice. There are tons of freebies out there, including themes, business cards, VOIP tools, etc, for you to use at absolutely no cost to yourself, so why not use them as much as you possibly can?

Save

Nobody likes the idea of having to save even a small part of their disposable income, but if you speak to an experienced freelancer they'll all tell you the same thing: Plan for a rainy day because you can be sure as heck it'll come along sooner rather than later. There are natural client droughts in the world of freelancing, and these typically occur in June, July, and December of each year. If you're not prepared for them well in advance you could find yourself not being able to pay your rent for 3 months out of the year.

As long as you understand that with great money comes great responsibility, then you shouldn't really have any problems. I still think you should bookmark this page and refer back to it at least once a month until you stop running into financial pitfalls that you should have seen coming.

Anything to add to the above? Leave a comment below folks!