The thought of being your own boss is an exciting and seemingly rewarding prospect. Whether you already have your own freelance business or you’re thinking of setting one up, it’s important to remember that money and budgeting is just as important as if you worked for an employer.
It can often be a challenged faced by many in the freelance world, to keep professional and personal finances separate. But not doing so can cause you some serious issues. Let’s take a look at some effective money saving tips if you’re operating in the freelance world.
Budgeting Each Month
As with many freelance businesses, the money you’re getting in each month can differ drastically. Some months may be better than others, which is why it’s important to revisit your budget every month. By doing this, you’ll be able to accurately track all your expenses (which is important for your taxes anyway). A good way to keep on top of your budgeting is by using specialist apps. There’s a number available online that are either free or can be used for a low monthly fee.
Having Separate Business and Personal Accounts
Keeping your finances separate is crucial, the last thing you want is to have a crossover and not know where you are with your money. Having a business account where you can keep an eye on all your incomings and outgoings will also help with your tax at the end of the financial year too.
Choose Your Financial Priorities
Choosing your financial priorities is a must, and something we recommend you do pretty early on in your freelance career. If you have to get to and from client meetings for example, a car is likely to be high on your expenses list. Make a note of how much your car finance is each month to add onto your budget, alongside any other outgoings you deem essential for your business. That way you’ll be able to keep a track of everything and know how much income you need to be billing for each month to pay for everything.
Stay On Top of Your Taxes
Taxes are something we all love to hate, but they’re a necessary evil. Instead of seeing them as a chore, look at them as a skill you’ll be glad you got a handle of! If you do your taxes right, it’s likely you’ll be able to save money too, if you’re doing it right. Make a note of any tax-deductible expenses you may have and include them in your tax return. Plus, if you learn to manage your taxes like a pro yourself, you’ll never have to fork out for an accountant!