How To Manage Your Money When You Become Self Employed

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Taking the leap from traditional employment to self-employment can be a very daunting time. Worries about whether you will succeed are normal, but the wonderful thing is, you are now the person in charge of that. Hard work and self-belief really will so much difference. However, there are a handful of other things you need to take care of also! One of the biggest of these is money and your finances.

Once you become self-employed, you no longer have a manager and HR department to sort out your monthly pay! Instead, you are the person in charge of making sure you earn and get paid

Send professional invoices

Invoices will become your holy grail. A professional looking invoice to clients or customers is a must. Anything that looks cheap or poorly made will give a bad impression of you, your company and your services. Word Docs has some pre-made invoice templates you can use, or you can get ideas online. Also, be sure that you send the same template of format for every single piece of work. It will make everything far easier in a few months time when you come to filing these away. A matching template means that there is a cohesive thread no matter the work, so pick one you won’t later want to change!

Hire legal help

Accountants are the secret trick behind most successful freelancers. They help you keep everything above board. When you first begin, you may be able to handle your finances yourself. But as you grow, your income will likely grow too. When this happens it will become harder to handle. In fact, legal help for all and any issues you face is advisable. Lawyers and solicitors should also be called upon if you stumble upon any legal issues. Any money you need to spend is worth it for the peace of mind, and for the money they may well save you in the future!

Up your rates annually

Inflation isn’t just something that happens to candy bars and vacations! You also need to consider increasing your rates each year. Don’t go crazy; you don’t want to lose customers as a result. But don’t be afraid to. As the cost of living rises, it is only fair that your fee or rate rises in accordance. Most people will be expecting this anyway, so as long as you are reasonable with how you much your increase your rate by, you won’t suffer.

Keep a track of everything

Keeping track of the work you are doing is important, as is keeping your invoices safe and secure. It is wise to keep invoices online in at least two different places, as well as printed copies. However, it is also wise to keep a track of the work you are doing every single day. This will help you later when you come to figuring out how you much have earned over the month, or year. Alongside this, keep a track of your outgoings also. You may even want to start living by a pre-made budget. This will come in especially handy in the first few months when you are still finding your feet.

 

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