How To Manage Your Finances As A Freelancer

 

How to manage your finances as a freelancer

 

Working for yourself is like a dream come true for many and with over £4 million people working as freelancers in the UK, it is a dream that many have made into a reality. There is no doubt that working as freelancer is exciting, but it also highly challenging – especially where money is concerned. Challenging but perfectly do-able. If you have started working as a freelancer or you are considering doing this, it is important to take control of your finances. These are some ways to manage your finances when working as a freelancer.

 

Keep an emergency fund

Work is really never guaranteed when you work as a freelancer. You could have loads of work one month and nothing the next, so it is important to be prepared. The particularly difficult months seem to be around Christmas, when most businesses shut down and if you are not prepared for this, it can cause a lot of stress. This is why it is so important to keep an emergency fund, so you can cope with difficult periods. If you have already started working as a freelancer, it is time to start putting money away. If you are just about to take a leap into the freelancer world, keep this in mind as you get started.

 

Charge your worth

When you are first starting up as a freelancer, it can be tempting to charge really low costs – just so that you get the work. However, you need to think about the other costs you are incurring, which your employer would usually cover. You need to pay tax, you’ll want to have some savings, a pension and also some cash to cover your holidays, as you need to make sure you take these – for the sake of your own sanity! With these in mind, make sure you charge the right fee – don’t undersell yourself.

 

Separate business account

It is a good idea to keep two separate accounts – one for your own personal use and one for your business. You can set up a standing order to pay yourself a set amount each month and keep the rest in your business account. This makes it much easier to do your taxes and it’s just a better, more organised way of managing your business.

 

Build a range of clients

Even if you get regular work from a specific client, you should never rely on this solely. If you do – it is just the same as working for an employer. You never know what might happen, so don’t put your eggs in one basket. Instead, make sure you get involved in different projects and build a range of clients. With the nature of freelance work, you never know when projects will end, so the more clients you have – the better. It is also important to keep learning and building your skills – so you can diversify your workload.

 

Manage your accounts

It is important to manage your accounts effectively – not just for the purposes of your tax returns, but also so you can manage your budget better. You need to know exactly how much you have coming in and what you have going out your account – otherwise you may quite easily find yourself in debt. There are lots of accounts packages for freelancers or if you don’t fancy doing it yourself, it may be worth enlisting the support of a professional.

 

Seek advice

Don’t be afraid to seek advice from professionals or other freelancers regarding the financial aspects of working for yourself. You’ll probably find that many others have experienced the exact same issues as you and knowing you have support can be hugely beneficial. There are all sorts of financial issues which can arise when freelancing and it is important to know what these are and how to ensure you don’t make the same mistakes.

 

Be great at what you do

If you want to be successful and manage your finances right as a freelancer, you need to be great at what you do. It’s not just about being skillful in your art, but also being reliable and good at communicating with your clients. If you build strong relationships with clients, you can guarantee that they will come to you again and this means your financial situation will greatly improve in the process.


How To Prepare Your Finances For Starting University

 

How to prepare your finances for starting University

Starting University is an exciting time in anyone’s lives. It’s the opportunity to go into the world on your own, learn new things and meet many different people. It is a chance to set off on a journey and although nerve wracking, it’s something most people want to do at some point in their lives. The only downside of going to University, is that it can be very expensive. There may be tuition fees to pay for but even if you don’t have this expense, you will still need to be able to handle the cost of living. There will be all sorts of costs which you won’t be used to and it important to prepare yourself for these, so you can enjoy your time at University and not get bogged down with financial problems. These are some ways to prepare your finances for starting University.

 

Start a budget

You can still have fun at University, even if you don’t have a lot of money – you just need to get really good at budgeting. Work out how much you will need to be able to enjoy things like Fresher’s week and other nights out and try to keep this money aside. You will have less to spend during the week and you will probably need to spend a few weekends at home, but it will be worth it if you still get to enjoy good nights out. Make sure you can pay your bills first and you can ensure this by keeping track of your incomings and outgoings. It’s not a particularly enjoyable task, but it is extremely useful for good financial management.

 

Share accommodation

You can significantly reduce your bills by sharing accommodation – either in the halls of residence or private rentals. It makes much more sense to share with someone else when you are at University and this is the one time you can get away with it – so make the most of it. If you choose to share, you can cut the cost of your rent, as well as all of your other bills. Everything will usually be split down the middle, so this will be much better for your finances.

 

Use student discounts

One of the major plus points of being at University is the fact that you can save money on just about everything! Most major stores will offer discounts for students and you can also usually get it for travel and other day to day expenses. Take full advantage of discounts wherever possible as this will help improve your financial situation when at University.

 

Don’t overspend

One of the problems with being a student are that companies are willing to throw money at you. This probably doesn’t seem like too much of an issue – but there is a huge temptation to take everything going, without really having the cash to pay it back. It is important to be careful with your spending when at University and don’t just take out as much as you can. You may be offered thousands of pounds on your overdraft on your student account, but you’ll need to pay it back – so don’t spend what you don’t need. University is about having fun; however, you don’t want to leave with massive amounts of debt.

 

Part time work

Regardless of whether or not you have a student loan, you should also aim to earn money while at University. There isn’t really an excuse not to work, as there are always plenty of opportunities available for students. Taking on a part time job can help support you at University and can also save you from getting into too much debt, before you even join the workplace. Money doesn’t tend to last long at University, so the more you can earn – the better.

 

Start cooking

If you want to keep your finances in check, learning to cook is a good way to do it. If you learn to cook, you can make your meals go much further. You can freeze what you make at night and enjoy it for days afterwards. Making meals from scratch is so much cheaper than getting takeaways and it’s also a much healthier option. If you can cook your meals, you can even make your own lunches, which will instantly save you a lot of expense.