6 Habits to Keep Your Finances Organized When Freelancing

Keeping your financial life organized when freelancing needs to be a top priority, especially if you want to grow your business and stay ahead of your bills. Even though the freelancing lifestyle doesn’t give you the security of a steady paycheck, there are several things you can do to stabilize your finances and keep up with your financial obligations. Here are just six habits to keep your finances organized when freelancing:

1. Review your budget at least once per month. Keep yourself on track and avoid making some common financial mistakes by reviewing your budget at least once per month. Revise your budget if some of your fixed expenses have changed, or if you’ve managed to reduce some of your variable expenses. Reviewing your budget at least once per month and keeping it up-to-date are essential for keeping your finances organized when freelancing.

2. “Report” your bills on your budget. Keep track of incoming bills by reporting the amount due right on your expense worksheet. This strategy makes it much easier to keep your finances organized and reduces the risk of a missed payment.

3. Pay your bills on a schedule. Set up a schedule of recurring bills so that you never miss a payment and are able to pay each bill ahead of time. Organize your expenses and bill payments to go out twice per month on a specific date. Make sure each bill is scheduled for payment in either the first or second round, and check it off as paid when you’re done. Getting into this habit early on in your career will help you keep your finances organized when freelancing.

4. Keep paying down debt. Even when money is just trickling in, get into the habit of paying down your debt as quickly as possible, and as often as possible. Stop using your credit cards for day-to-day expenses and work on building a credit card payoff fund. Make larger payments on your high-interest credit cards so that you can get out of debt as quickly as possible.

5. Automate your savings. Take steps to automatically transfer funds from your checking account directly into your money market or savings account on a recurring basis. Making the savings deposit a “hands off” activity will increase your chances of building up that savings account. It’s one less thing to worry about and will help you focus on other activities when you’re keeping your finances organized.

6. Set up multiple checking and savings accounts. Compartmentalizing your checking and savings accounts can make it much easier to organize your finances. For example, you could set up two checking outs – one for business expenses, and another for personal and living expenses – and two or three savings accounts. Multiple savings accounts could be created for your emergency fund, luxury expenses and for your quarterly tax payments.

Acquiring some good financial habits early in your freelancing career can set you up for a healthy financial future. Use these six tips to get your finances organized and take control of your financial life as a freelancer.