Second, I'm just one freelancer, sharing her thoughts. As I tell my copyediting clients—after setting forth the applicable grammar/spelling rule(s) so they can make an informed decision—take what resonates from my edits and suggestions and toss the rest. The same maxim applies here. However, even if you don't (yet) agree with my suggestions offered below, you may hit upon a better rendition for you (even for others; please share!).
Third, despite all the great financial info out there (pay yourself first, set up autosavings, etc.), none of that helps the proverbial starving artist or struggling freelancer. I do not have autodrafts for my bills set up as there are times when I'll have $0.88 in my account for weeks on end. So I have to manually pay my bills. Which, as mentioned before, is working for me. If you are not the most reliable one to take on this manual approach to bill-paying, then hopefully your roommate/partner/spouse is better at it. Let them take the reins on this one.
Fourth, for a freelancer, you have to change your monetary focus on those long-term goals and reset to ponder short-term goals. And it's a sliding scale. If you have money to cover your monthly bare-bones expenses (and you do know what that exact figure is, right?), great. And, just to be clear here, "bare-bones expenses" does not include house taxes (if you pay them separately, if you do not have them added into your monthly mortgage payment) and does not include IRS taxes unless this particular month includes an estimated quarterly tax payment deadline. So just the mortgage/rent payment, utilities, food, car gas (if needed). Now, if you don't have money to cover just this month's bills, don't let that worry you. For now. Do you have enough for today? And by that I mean, food, water, shelter, clothing, even money to pay a bill due tomorrow or the next day. Then consider yourself lucky and blessed.
Fifth, DON'T WORRY. I still do, but maybe this will remind me not to. In the freelance world, tomorrow you could have five prepaid projects coming in within the span of five minutes. Or you could get five prepaid jobs, one a day over the span of the next five consecutive days. The point here is, you don't know what tomorrow will bring. So be happy with what you've got today. Tomorrow may have more pleasant surprises for you. With the freelancing life, you've got to have hope and faith. A lot of each.
Sixth, I know when I have a really great month (exceeding my entire monthly expenses' needs, meaning one-twelfth of the house taxes and one-thirdish of the next estimated tax payment to the IRS), I have the urge to pay a principal-only mortgage payment or to make a double payment on my HVAC loan with its remaining balance edging closer and closer to $1,000. DON'T. My son pointed this out to me, and it is so true. When you make that extra principal-only mortgage payment, it does not negate next month's mortgage payment. And, granted, the principle-only payment is nowhere near the P&I payment due monthly. But it's a start in the right direction if you have that sitting in your account, correct? So resist that urge to pay more than the required payment on ANY bill. Instead set aside that $100 or whatever into a savings account or your hidey-hole at home or for your extremely trustworthy roommate to sequester until those last three months of the year where you have no business to speak of. Which is my particular annual event.
Seventh, in my scenario, (a) I have no credit cards (only debit cards) as I happen to think credit cards are of the devil. They should be outlawed in my opinion. And pushing them on college-age kids is akin to pushing drugs on kindergarteners. Just my opinion here. (b) Plus my twenty-four-year-old car (that I love) is paid off. So think twice about jumping headfirst into your own business, foregoing that steady-paycheck day job if you have credit card debt and a huge car payment and live by yourself, even if your mortgage is paid off. Believe me, your freelancing days will give you plenty of freedom but it may take years before you ever make the money you did in the corporate world. Just saying ...
SIDE NOTE HERE: Some of us are meant to be our own bosses (me, for instance). Others of us are meant to be in the corporate world, working for a boss. As long as you know your rightful place, you should be happy working there. However, be forewarned. If you are more security focused, then you need to stay in that 9-to-5 job with the paychecks coming on the first and the fifteenth of each month, like clockwork, and in the exact same amount each time. Now, if you are more like me, and freedom means more to you than a set amount being deposited into your account twice monthly, then maybe you should try freelancing on the side, as you pay down your debts and pay off your car note (keeping that day job for now), until you can minimize your expenses and truly start off on the right foot to being your own boss. It's a heady feeling.
Eighth, when you're really hurting for money, and you can't seem to get a day job (or your car is dead in the garage and now you must restrict your day-job options to those businesses nearby that you can walk to), do what Marianne Williamson advocates: empty a drawer. I swear it worked for me earlier at the start of this year. Something about nature's law of a vacuum. The universe seeks to fill it.
Ninth, this is one tip from the "normal" financial world that works in the freelancer's world as well. Diversify. Have multiple streams of income. Don't put all your eggs in one basket. That way, hopefully, when one stream dries up (temporarily or permanently), you'll have others to support you in the meantime as you reassess your options.
Okay, that's it for my financial tips for you today. My mind kept nagging me to share this, so, now that I've done so, maybe my brain will turn to something else, like creative ideas for my first-ever fiction series. That would be wonderful.
Are you an experienced freelancer with more operating advice for me, for us? Would love to hear it.
Take care, all.
Denise Barker, Author, Blogger, Copy Editor
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