How to look after your income when freelance earnings are up and down

People choose to freelance for loads of reasons - independence, creative freedom, working on their own projects on their own terms. They know it’s got a bit of risk attached, but not feeling that Sunday night dread is usually worth it.

Inevitably though, your income won’t be the same every single month like it would be in a ‘normal job’. How can you budget and save when your earnings are flexible?


Plan (at least) 1 month in advance

Some clients will expect a 30-day payment deadline, and others will be late and forgetful, so you might not see any cash for a month after sending an invoice.

If March was a busy month, but April is below average, you’ll probably see the effects 30-40 days after all the work is done and the invoices are sent. If you can anticipate these fluctuations, you can adjust your spending to match.


Watch your big and small expenses

Going freelance could be quite a big change for your household cash in terms of regularity and reliability. While your freelance business is in its first few months, it’s a good idea to plan or postpone big expenses if you can. Basically, it’s not the best time to book a trip to the Maldives...

Small expenses matter too, even if you’ve been freelancing for a while. It’s still worth checking your bank statements and Direct Debits regularly. Subscriptions, memberships, and even meals and nights out can start adding up and draining your account a bit too quickly.


Save, save, save

We don’t want to get all negative, but it’s time to address the Big Fear for all freelancers - losing business. It happens to everyone for loads of different reasons. One of your clients might change their budget, not need your services anymore, or even close down.

Losing just one or two clients could make a big difference to your monthly income, so saving regularly into a separate account is really important. How much you save is up to you, but lots of people swear by the 50/30/20 budget. 50% goes on bills and essentials, 30% on fun stuff, and 20% goes away for later.


Remember your retirement

Freelancing might give you loads of freedom, but there are always a couple of downsides. You don’t have an employer to automatically enroll you in a pension scheme or make contributions, so you have to save for retirement on your own.

Try the Pensions Advisory Service if you’re not sure where to start. It’s got all the basic info, including how to start saving and where to look for private pension providers.


Send super smart invoices that get you paid faster

Solna has loads of helpful tools that make it easier for freelancers to get paid. Create branded invoices, send automatic reminders to your clients, and make it easy for customers to pay you direct from the invoice.


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