by Ken Bickel
Budgeting your finances as a freelancer is essential to your survival. Every independent worker longs for absolute and lasting success, but until you achieve it, there are plenty of ways to make a stable living – but only if you manage your finances properly. Devote the appropriate amount of time and attention to your money management and you can take a lot of the stress out of the equation. The last thing you want is to have to return to the corporate world, especially in light of today's hiring landscape. To learn how to stay put and thrive as a freelancer, read on.
1. Halt Personal Spending
This may sound like a harsh measure, but it's only necessary until you gain control over your finances. Just tell yourself you're not going to spend any money beyond the necessities like gas and groceries for one week. See how much you saved during that time and determine if you truly missed out on anything. This strategy can serve you well going forward when you need a fairly quick influx of cash.
2. *Get on a Budget*
Once all this slicing and dicing is done, get yourself on a budget. Write down the new amounts for your bills on one side of a piece of paper. Then, write out your estimated income on the other. To arrive at this number, average out your past 12 months of earnings or, to be more conservative, take the worst month you had in the recent past. Hopefully in light of all your cost-saving measures your spending is below your income. If not, you've got a bit more work to do.
3. Market Yourself
A great way to make budgeting easier is to boost your income. Are you marketing yourself and your talents to the best of your abilities? When is the last time you tried out a new social media platform like Pinterest or Google Plus? How about trying to get yourself on a local radio show or TV news program? Bringing in more income makes managing your finances a whole lot easier.
4. Slash Your Monthly Bills
Next, take a look at your monthly bills. Cut back on your channel package to save on cable TV. Review your smartphone data usage, judge it against your plan, and pare it back as necessary. Investigate the competition for all monthly services like Internet, phone, and cable, and see if bundling is an option. Cut down on your showers, do all lawn watering late at night, and commit to running full loads of dishes and clothes to reduce your water bill.
5. Commit to Paying Off Credit Card Debt
If you have a surplus in your budget but are still carrying credit card balances, get those squared away first. Once they're in your rearview mirror, you're going to be stunned by how much more you have left in your bank account each month. Credit card debts can suck the life right out of a budget - get rid of yours quickly.
6. Find Quick and Dirty Ways to Save Money
To top it all off, look for some quick and dirty ways to save money. Clip coupons to reduce your grocery bill. Skip those trips to the convenience store for candy, newspapers, and lottery tickets. Walk through your house and unplug everything that rarely gets used to lower your electricity bill, even if those items aren't turned on.
If you're thinking about freelancing for a living or are in the process of making the switch, do yourself a favor and hold onto your traditional job until you're absolutely sure you can make the jump. Although the benefits of full-time freelancing are appealing, a good safety net can reduce stress and catch you should you need it. When your freelancing begins to suffer because of the hours you need to devote to your day job, that's the time to make the switch. Until then, hang tight and save as much money as you can. If you do enough planning and continue to keep your eye on the ball, the sky is the limit.
What money management tips do you know of for freelancers?
**Editor’s Note: **Guest blogger Ken Bickel is a freelance writer and personal finance columnist who gives readers tips related to money management and careers.