I am a member of a couple different freelancing communities. Being involved gives me a chance to stay current, and it also provides a lot of food for thought.
Maybe it’s just because of the holidays, but it seems like there are a lot of freelancers living paycheck to paycheck. And it’s not just freelancers, of course; a lot of people do it. As freelancers, however, we don’t need to. A little extra planning, and a little extra work, and we can beat the cycle and get ahead of our finances.
I’ll be the first to admit that I am just as bad about not planning ahead with my expenses as anyone out there. I can’t tell you the number of times I’ve pulled last-minute working sprees, just for the sake of paying a bill on time. It’s stressful, and I’m trying to leave this habit behind this year. This is how I’m doing it.
- Figure out my monthly expenses. I want to be at least one month ahead, so I need to have that amount extra in the bank. My expenses are around $1500 each month.
- Set a goal, and divide it up. I would like to be entirely ahead in 6 months. That means that I need to set aside $250 a month, or about $63 a week.
- Create a plan for making the extra money. I know that I can hit this goal with 4-5 extra articles at Demand Studios. If I write an extra 5 articles a week, I can have the full $1500 in 20 weeks, or about 5 months.
- Stay motivated. Determine a reward for when you hit your goal. I plan on making this a family project, with my husband and I both working towards making sure the money is set aside. We’ll come up with a reward for once we complete the goal, maybe a night out or picking up a couple movies and ordering Chinese. We’re easily pleased, but your reward can be as big as you’d like (as long as it doesn’t cut into your new savings).
Once we hit the $1500 mark, I want to keep going. If I put aside that same $75 a week all year, I’ll have $3900 set aside by the end of the year. That’s enough for a car repair, new laptop, and a month of expenses.
I’m done living paycheck to paycheck; this year, I’m breaking free. Not having to worry about money when I need to take a few days off here or there will be more than worth the extra effort.
So, who’s with me? 