Financial Quirks Of Freelance Life
The Freelance life can be tougher than it seems, and that’s just the finances. You’re going to be your own boss, and that can be hard work. You might not have a reliable paycheck. You might be out of pocket when you replace the equipment needed to complete your job. Self-employment? It can come at a big cost sometimes.
Firstly, there are tax considerations. If you’re your own boss – you will be responsible for filling out your tax forms on time, and accurately. Mistakes here can cost you as much as weeks work, which can be crippling to your finances – but you could also be prosecuted for large mistakes.
If you’re unsure, you might consider hiring a responsible accountant who can help you with your tax and also ensure you’re getting the most from your money. Make sure you save your receipts – as meetings, coffees, transportation and equipment costs might be reimbursed by your tax.
Those of us living that freelance life gets paid through invoices, so it’s worth your time perfecting your template to ensure it works for your clients. A heavily designed invoice might not work here – stick to the simple information – namely you, the work was done, the cost and your banking information.
Even if you get your invoice in on time, as perfect as it’d be – not all of your clients or employers are going to pay on time. It’s not a guarantee that they’ll pay at all in some severe circumstances. Research your clients perfectly – and be sure to network with other freelancers or self-employed workers. You’ll be able to spot bad clients and good clients from a mile off – but don’t be afraid to do business with those who don’t pay on time, just be sure to chase up your money often if you do!
This type of situation can leave you short of cash. If you’re owed hundreds, you’re going to be out by hundreds – and when you are trying to make ends meet in your life, this isn’t the best situation to be in. Help is available though and this is an area where a company like Captain Cash can help out, ensuring you can meet your financial commitments.
Being short of cash can be a regular situation during self-employed life, so loans and credit cards might be a necessity. It’s important that you only spend what can be afforded though, as getting into a dire financial situation might force you back into full-time employment.
On the flip side of this, try not to accept cash payment before you have completed a job as this can ruin your motivation. An advance is fine, and in some circumstances, you might want a bit of safety, but accepted payment before a job is done can lead to disaster for your productivity. It’s not a good look, basically. It ensures we settle – and that means we won’t be productive when required, you’ll need to work for your cash.
Freelance life and self-employed life I heavily rewarding – but it comes with some financial quirks and woes that can land someone in some trouble. Be vigilant and sensible if you want to be a financially stable freelancer.
