The work of a freelancer today has become especially popular among people who prefer a free schedule. But like any employment, it implies a practical qualitative use of the budget. You must understand that only an effective planning approach can bring the desired profit. Here are some practical tips.
Determine your monthly overhead
First of all, you need to determine how much money you need to live. This includes utility bills, food, clothing, travel, rental, entertainment and other necessary expenses that cannot be ignored. Add all these amounts, and you get the amount that determines your spending. To feel confident, you need to earn a little more than this amount. Even a small amount of money in excess of this number indicates that you are on the right track. But if the earned money is not enough for mandatory spending, then you need to work more, since such activity is considered unprofitable.
Find out the terms of payment
You have determined the amount you need for your monthly expenses. Now it's time to determine when and how you get paid for the job. In some cases, money comes once a week, it happens that it happens once or twice a month. If you have a clear replenishment schedule, you will be able to correctly operate this money for your needs. Find the most convenient option (for example, at what time you will pay utility bills, purchase products, etc.). Smart planning will be your first financial assistant.
Spend expenses until next replenishment
A huge mistake will be to immediately spend all the money earned for a good order. If you received a significant amount and paid the bills that were planned, you still can not afford to spend all the savings that you have today. The specifics of the freelancer's work provides for the absence of a fixed income; it cannot be called stable in terms of financial replenishment. And if you are lucky enough to earn a decent amount of money at a time, there is no guarantee that you will be lucky the next time either. Therefore, postpone a certain amount until the next replenishment of your account.
Pay yourself a salary
You constantly receive a certain amount of money, which consists of several receipts. Think of a way to pay yourself to feel confident. And this is not banal advice (you will think that cash receipts are payment), but a whole philosophy. You should first of all think about your necessary expenses (meals, training, etc.), and then add taxes and everything else here. Therefore, think about how you better distribute the cash proceeds. This may be a certain percentage of each deposit. 10, 20, 30 or 50 percent (depending on the amount you earn) you must pay yourself monthly, as an employee. Distribute the rest according to the schemes that we considered above.
Open multiple accounts
It would be a great solution to open multiple accounts. One of them can be arranged specifically for paying off debts (for example, a loan), the second will be inviolable (for example, ten percent of the income will be deposited every month on your dream: an expensive purchase, vacation, training, etc.), and the third - on your personal expenses (this includes household needs, food, entertainment, etc.). These accounts do not have to be on bank cards (although the “untouchable” savings account is best done exactly that way), money can be cashed out and then distributed.
Reasonable savings
Based on the previous paragraph, I would like to add that cashing in money will help you significantly save in terms of food and spending on vacation. It is proved that money from a card is spent much faster than cash that is in your wallet. You will be able to clearly see how quickly seemingly large sums go away. Therefore, before you go to the store for shopping or go to the amusement park (or any other place of leisure), make a plan of your potential spending. For a store, this is a list of items that need to be purchased. For leisure activities, this is an amount exceeding which is strictly prohibited.
The benefits of planning
The plan by which your money will “work” is of great importance to you. All that you earn will pay off your taxes and all necessary needs. And the deferred amount on the card will become your buffer, which will help if necessary (for example, unexpected spending on a computer or other expenses). You will be sure that you have money for basic expenses and unforeseen expenses. Try to be a qualified accountant and an understanding boss. Only this approach will allow you to enjoy your work and enjoy pleasant financial rewards for your work.
