5 Money-Saving Hacks for the Self-Employed

Leaving a boring, but steady job for a challenging, but risky freelancer career will completely change your point of the world. Also, now that you don’t have a fixed monthly income, your financial planning requires more thinking in advance. Since freelancers usually experience ups and downs in the number of clients and projects, they need to put some money aside when the monetary tide is high.

In a nutshell – it’s crucial to save money when you have it, to overcome the dry seasons. Here’s how a new freelancer can form a special savings fund from day one of their new career.

Follow the expenditure percentage rule

A rule of thumb is that you should first cover your fixed expenses – the utilities, the rent, the taxes and the insurance. In addition to that, you need to calculate how much you can spend on food and clothes per month.

Only when these necessities are sorted out should you make plans for additional spending. According to Forbes’ financial experts, your budget should be based on the 50-30-20 rule. In line with that, you should spend 50% of your income on the fixed expenses, 30% would be used for flexible expenditure, while 20% should be put aside or invested in business projects.

This advice is a fair start for a freelancer. Regardless of the amount of money you make, try to use this percentage in your budget planning. As a result, you’ll be able to take care of yourself, no matter how much you make as a freelancer.

Farewell impulse buying

Having a full-time job means that you can bring irrational financial decisions from time to time. Even if you succumb to impulse buying, you know that your next monthly payment will cover that expense.

Freelancers, on the other hand, can’t count on that cushion that will insulate them when impulse expenditure fights back. Therefore, if you’re set to become a freelancer, you need to become equally resolute when it comes to meticulously planned buying.

Instead of going to the local shop every day, you should start using the benefits of weekly grocery shopping. In line with that, sit down with your partner and children and make a shopping list. Since your freelancing projects will most certainly preoccupy your time, this is also a great chance for you to spend some time together, while making something practical and useful for your budget.

Similarly, search online catalogs for discounts and special offers, especially when it comes to buying more expensive things, like furniture, household appliances or vehicles. These special deals will keep a few dollars more in your pocket.

Improve the debt-collecting efficiency

While starting out as a freelancer, you might need to accept lower rates until you acquire a number of loyal clients. However, this doesn’t mean that you should agree to long payment period.

Therefore, the debt-collecting efficiency should be one of the key elements of every collaboration you make. For instance, you can allow your clients to pay you within 30 days from the day you hand in the finished project. If they miss the deadline, feel free to send them a polite reminder.

Those who don’t make the payment after the reminder should be sent a serious-toned reminder letter that demands a fast payment.

In order to protect yourself from such outcomes, you need to set the payment terms in advance. Also, asking for a down payment is a clever option to protect yourself.

Managing to collect all the payments on time will enable you to handle all your income as you make money, so as to put aside the amount that you don’t need for everyday life.

Additionally, if you have some late, but loyal payers, you could create a special savings pot for late payments. You can simply pretend that you don’t have that money until you have an unexpected expense, such as a car repair or a short vacation.

Save on your office space

Renting a fancy office with marble floor and a water cooler will undoubtedly leave a great impression on your business clients and partners. Nevertheless, it will also leave a deep mark on your budget.

Because of that, think twice before you decide to rent a separate office for your sole proprietorship. It will eat a large portion of your income. Also, you can’t know how much you’ll be making in the first few months, which makes renting an office pointless.

As an alternative, you could rent a workspace in one of those shared offices. That way, you can join forces with several other freelancers and rent one larger office, so as to share the expenses and save money along the way. As for the reception of clients, you can make a schedule that will determine those appointments.

The next step is to calculate the difference between the rent you pay in the shared office and the rent you’d pay in a separate office. That sum should be put aside and added to your savings account.

Prey on discounts

We’ve already mentioned that you should do some Web research to find coupons and vouchers for discounts. Still, this can become your regular daily task if you register to one of the money-saving websites and receive updated newsletters.

One of the major benefits of such an approach to personal finances is the fact that you can make a purchase online and have the purchased goods delivered to your door. As a result, you won’t have to waste your fuel and time to go and buy those items. What’s more, you’ll get a discount on those things. As a result, you can make a saving within the aforementioned 50% meant for your fixed expenses.

Apart from that, shopping via vouchers and coupons can also free some monetary space within the 30% reserved for flexible expenditure. In turn, these little savings can be transferred to the 20%-savings fund.

However, it’s important to read all the terms and conditions when it comes to these online purchases with discounts. The products sold this way are sometimes damaged, refurbished or simply close to the expiration date, so bear that in mind and make a thorough analysis before the shopping.


Putting money aside when you’re a freelancer is extremely important because those personal saving funds are here to save you when you have fewer projects. Freelancers should plan every single shopping and they shouldn’t bring any hasty decisions. That way, you’ll bring order to your finances and manage to go through every difficulty without any financial collateral damage on your accounts.

Mark Thomasson
Mark is a biz-dev hero at Invoicebus - a simple invoicing service that gets your invoices paid faster. He passionately blogs on topics that help small biz owners succeed in their business. He is also a lifelong learner who practices mindfulness and enjoys long walks in nature more than anything else.
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