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How to Save Money as a Freelancer Without a Steady Paycheck

When I first started freelancing, all I wanted was to have my work published. I didn’t care if my content earned money. I just wanted my writing to be accepted and enjoyed.

When I landed my first guest post, I was elated.

After that, I wanted to prove I could make money writing. I’m not talking about stable income. I mean any amount of money.

When I landed my first paid post, I was through the roof. I was paid $100 for an 871-word post on mindful spending. It wasn’t the $100 though — I mean, I’m not going to complain about an extra Benjamin in my bank account — but that was minuscule relative to the self-satisfaction that came from being paid for my words, my voice, and my ideas.

It validated freelancing as a source of income — and a potential career.

The next step was making consistent money. Not necessarily a lot, but some amount of stable work and income.

When I landed my first client, I popped champagne.

I’m not even kidding.

The next step was breaking even — making enough money each month to cover my expenses.

When I established myself as a freelancer and business owner, earning enough money every month to cover my expenses, a warm sense of pride swept through me.

When you own a business, there’s always that next step. That’s what keeps us motivated to keep grinding and growing. It’s that feeling of “man, if I could just do X — my life would be set, I’d be so happy.”

Whether it’s just having someone appreciate your writing or making a stable income from freelancing, there are goals that keep us going.

One of those goals needs to be saving money — specifically, enough to establish financial stability and to help you reach your life goals.

How should I save money?

It’s not hard to understand the importance of saving — it’s the “how” that can stump people. Before you can worry about making more or spending less, you need to have your financial infrastructure and process in place.

Set up your infrastructure

First, we need to make sure your finances are organized. That includes your business’s finances and your personal finances. Here are five bank accounts you should have:

  1. Personal checking for monthly expenses
  2. Personal high-yield savings for emergency funds
  3. Business checking for operating expenses
  4. Brokerage for investments, which should be tied to your life goals.
  5. Retirement (e.g. SEP-IRA) for retirement (obviously).

Get Your Finances Organized

Stop stressing and clean up your money.

You must separate your business from your personal life. That means you’ll need to open a business bank account and sign up for an invoicing platform (like PayPal, Veem, Quickbooks, or Freshbooks).

For most freelancers, the cost of running a business is pretty small. As a result, your personal expenses are going to be the primary driver of whether you make money or not.

Establish your saving process

Now, let’s talk about the process of saving money as a freelancer.

More likely than not, your payment schedule isn’t going to be as clean as a biweekly corporate paycheck. Instead, you’re going to work with clients (big and small) that have different payout periods. Even if you invoice on a set date every month, your clients aren’t all going to pay you on the same day.

So, your process every month needs to look something like this:

  1. Track your income. Use your paid invoices to calculate how much you made. Consolidate into a spreadsheet for a clean overview.
  2. Track your expenses. Use your credit card and debit card statements to do so. You can download your monthly activity from your financial institution’s website.
  3. Calculate your net income for the month. This amount should be your monthly savings.
  4. Transfer your savings to your emergency fund. If your emergency fund is at the appropriate level (six months of expenses), transfer your savings into your brokerage account and retirement account.

When you’re tracking income, keep in mind that you’re not necessarily receiving payments when you deliver work. In other words, just because you delivered $2,500 worth of work to clients in January doesn’t mean you’re receiving $2,500 in January. Depending on your invoicing schedule and payment terms, you probably won’t receive most of that until February or March.

As a result, your monthly savings need to be based on the money you actually receive (i.e. paid invoices).

Set a schedule, pick a date, and stick to it. This process needs to become an ongoing routine. You could choose the 5th of every month to assess how much money you received in the prior month and how much you spent. Then you can calculate your net income (i.e. your savings) and transfer accordingly.

How can I make sure I’m saving?

I’m pretty sure that’s not a viable soil for growth — Photo by Micheile Henderson on Unsplash

From day one, making a stable income is a dream goal for all freelancers. Reaching the point where you’re earning enough to not only get you by — but also save and live a fulfilling lifestyle.

Sometimes that means taking not-so-desirable approaches to make sure that dream becomes a reality.

Budget and adjust your lifestyle

I’ve said it before, I’ll say it again: if you’re going to be a freelancer, you need to budget.

First and foremost, I suggest creating (and sticking to) a budget. It’s my top recommendation (above any other) for increasing savings. When you think about saving, it’s a simple formula:

Income — expenses = net income (savings)

Based on that, you have two options: make more money or spend less money. It’s way, way easier to spend less than to make more. To earn income, you have to provide a product or service and someone else has to pay you for it. On the other hand, you control your expenses (for the most part).

Budgeting allows you to track your expenses and expose areas of overspending. Your budget is your financial blueprint.

It’s simple. Freelancing does not require a ton of costs. In most cases, your personal needs and wants will account for 90–95% of your expenses. So, if you want your business to provide you with a stable lifestyle and income, you need to be in control of your finances — and you need to budget.

Budgeting isn’t complicated or time-consuming. In fact, you can create a budget in roughly 15 minutes, which I wrote about here. If the thought of cutting back on expenses and adjusting your lifestyle scares you — or you don’t know where to start — don’t worry. I wrote about that too.

The Sexiest 15-Minute Budget

You heard me. Sexiest.

How I Cut My Monthly Expenses by 32%

If you want to maximize your earnings, you need to minimize your expenses.

Once you create your budget, focus on areas of excess. It’s about finding the right balance between saving and being realistic. You don’t want a budget you can’t stick to, you want a budget that allows you to save without eliminating the joys of life.

Again, creating a budget isn’t the challenge. Once you start, you’ll realize it’s pretty easy to assemble. The challenge is sticking to it and adjusting your lifestyle to match it.

Work with out-of-niche clients

We’re always in search of our ideal client — high paying, respectful, communicative, timely clients in our niche. As much as we want to hold out for them, the need for money gets in the way.

Sometimes we have to take less-than-ideal clients to get by.

Sometimes we have to write about topics we don’t particularly enjoy.

Yes, it’s important to write within your niche to establish your credibility and portfolio — but, every now and then, you have to stretch outside of your usual scope.

At the end of the day, you need to pay bills. You need to buy food. You need a little fun money.

I totally understand avoiding red flag-waving leads or cutting ties with bad clients. Don’t force yourself into a miserable situation. But if you find a decent paying gig with a potential client that checks most of the boxes (or at least doesn’t raise any alarms), go for it. Assuming you need the money.

Provide volume discounts

For most freelancers, the problem isn’t finding work — it’s finding enough work to make a living.

One solution is offering volume discounts to leads and clients. For example, let’s say a client wants one blog post per month for $200. You could explain the benefits of higher frequency (more traffic and leads) and offer to do three posts for $500 per month.

The underlying message you’re trying to convey to the lead/client is that they’re receiving added value. In this case, they’re getting two more posts and saving $100.

Yes, you’re making less per post — but you’re making $300 more than you were before.

Consider part-time jobs

If you’re in dire straits and you need to make some more money, a part-time job might be necessary. Don’t get me wrong, I don’t like this suggestion. Time is finite. The thought of adding more to the full plate of a freelancer isn’t fun.

But, if you need additional income, driving for Uber or Lyft might be the best complement to freelancing. You still maintain total autonomy over your schedule, since you can choose when and how long you want to drive.

There’s still some sacrifice involved (likely weekend free time), but it can boost your savings.

Your earning potential as a driver depends on the city you live in, but it generally ranges from $12 to $22 per hour. That’s after Uber/Lyft’s share — but before taxes and the costs of driving (gas, maintenance, etc.).

Assuming you make somewhere in the middle of that range (let’s say $17), you could make an extra $272 a month if you drive four hours a week. Again, that’s before driving costs and taxes — but it’s a worthy solution if you’re struggling to save money.

One lesson to take away…

You need to be saving some amount of money every month.

If you can save 20% of your income, great. If you can save more, hell yeah — your future self will appreciate it. If you can only muster 5%, that’s fine.

Something’s better than nothing.

At the end of the day, how much you need to save depends on your lifestyle and life goals. If you have expensive tastes and dreams, you need to prioritize saving as much as possible.

What are some ways you earn a little extra each month? What tactics do you use?


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