freelancing

7 Signs It's Time to Quit Freelancing

Paul Michael — Mon, 15 Jan 2018 09:00:07 +0000

Tell someone you're a freelancer, and you'll usually be treated with a mix of envy and admiration. Freelancing brings with it a perception of freedom and flexibility that is a definite plus, but much harder to sustain than many people might realize.

As a freelancer, chances are you put in more hours and are on the go more than regular full-time employees. You don't get subsidized health care, a 401(k) match, or paid vacation. It can be tough — sometimes, too tough. And when the following red flags appear, it may be time to throw in the towel. (See also: Day Job or Freelance: Which Is Right for You?)

1. You don't enjoy it anymore

Let's start with the most obvious reason. If it's just not something you like doing anymore, maybe it's time to start thinking about a different career path. Remember when you first decided to jump into the freelancing pool? The buzz you felt going it alone. Hustling for clients. Being your own boss. It all felt like the world was your oyster. If you now get up every day wishing you'd made a different choice, that's life telling you you're wasting time.

Our job takes up the majority of our waking hours, so to be doing something that makes every one of them painful is just not worth it. What do you daydream about doing instead? What would reinvigorate those passions you once felt for freelancing? Listen to your gut and make a move in that direction. (See also: 8 Signs the 9-to-5 IS Right for You)

2. It's getting harder and harder to find work

When you first dipped your toe into the freelance pool, you had to hustle to get those initial clients. But, after some hard work, you built up a nice client roster and had enough regular work to make freelancing a financial success. However, things change. Markets change. Freelance industries can become flooded with new and cheaper talent. And, of course, there are those sites like Fiverr and Guru that are crammed with people all over the world charging rates that you cannot even begin to compete with.

That mix of more competition, lower freelance rates, and even corporate downsizing can have a serious impact on the time you spend trying to find work. And if you spend more time looking for it than working on it, you could be in real trouble. (See also: How to Land More Freelance Clients)

3. You can no longer afford to pay for your own health care

This is a big reason freelancers are returning to the workforce, and it's a sad sign of the times. Corporations and small businesses have the clout to negotiate excellent rates for their employees. Not only that, but the company pays the majority of the monthly premium, with some companies even offering completely free HMO coverage for an employee and family.

As a freelancer, you don't have that kind of power. According to data gathered by eHealth, the average individual health insurance premium for 2017 was $393 a month. It skyrockets to $1,021 a month for families. That's not taking into account deductibles, which you have to meet before the insurance kicks in. It's a huge burden for a freelancer to take on, and coming back into the fold can be a relief. (See also: 10 Work Perks You Can't Get as a Freelancer)

4. You miss the interaction with other employees

Freelancing can be a lonely business. Many people take daily human interaction for granted. In fact, some people tire of it all, and it becomes a major reason for freelancing and going solo. But over time, you can go days without talking to anyone except the checkout cashier and the dog.

Humans, for the most part, are social creatures; it's only natural to start longing to be around other people again — for those water cooler talks about last night's killer season finale, or the latest and greatest music you've discovered. And while texting and calling people can help with the loneliness, it can become depressing. If it's starting to weigh on you every day, and you are making excuses to leave the house, it's time to think about returning to the workforce. (See also: 11 Ways Freelancers and Telecommuters Can Make Friends and Network)

5. You're bored and you're coasting

Has the freelance life lost its spark because you are simply not being challenged anymore? It's possible that your daily work routine is filled with the same projects, for the same clients, over and over again.

Some freelance writers get stuck penning annual reports and company brochures week in, week out, and it becomes monotonous work. Some freelance photographers get stuck doing weddings and graduations, and although it's special for the people being photographed, it can be tedious taking the same shots every time. Whatever your freelance gig, if you are dreading getting out of bed in the morning because you have "those projects," you have lost your passion. Dive back into something more challenging, for your own mental wellbeing.

6. You can't make ends meet

Freelancing is a constant hustle. It can be exhausting to find work for yourself. What's worse is when the jobs start paying less, or you lose a few clients. Some clients will be tempted by younger freelancers offering lower rates. Others may just be retiring, or going in another direction. And while it's important not to panic if you do lose some regular monthly income, you have to be prudent about how long you ride it out.

Can you find something that will make up for that income loss before it really starts to eat away at your emergency fund? Do you even have an emergency fund? What can you cut out to keep going? Examine the budget carefully, and if things are looking bleak, you may need to cut and run to a regular, full-time salary. (See also: The Smart Way to Budget on a Freelance Income)

7. The work-life balance is no longer acceptable

When you first started freelancing, you knew you'd have to put in extra hours to get the business off the ground. After that, it should have been more like a day job, with regular hours that you work, regular time to relax, and hopefully, a week or two of vacation. However, some freelancers swear by the saying, "Never turn down work — they may never ask again."

That can be a huge problem. You don't want to turn work away and risk an income stream drying up. But you're tired. You've been putting in 60-hour weeks and you need a break. If you have reached that stage where you are living to work, and not working to live, you should consider quitting and finding a full-time job with an employer. (See also: 9 Signs Your Work-Life Balance Is Off)

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This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Best Money Tips: Freelancing Myths That Can Derail Your Success

Amy Lu — Wed, 10 Jan 2018 09:30:11 +0000

Welcome to Wise Bread's Best Money Tips Roundup! Today we found articles on freelancing myths that can derail your success, superfoods that will keep you healthy this winter, and how to get cheap prices at luxury hotels.

How to Land More Freelance Clients in a Snap

Paul Michael — Thu, 21 Dec 2017 09:30:10 +0000

You've got a freelance business. Maybe you already have a few clients, or you're looking for your very first ones. Either way, you need successful strategies to add more customers to your roster. Diversification is key when you are freelancing, so use the following tips to expand your client base and build a more solid foundation.

1. Take advantage of social media

It's free, it's popular, and it's a quick and easy way to reach millions of people. If you don't already have them, set up business pages on Facebook, Twitter, Instagram, and if it's applicable, Pinterest. Then start pushing out content.

Retweet articles about your industry and comment on them. Publish links to articles you have written. Get your work samples photographed and uploaded, and make sure you use plenty of hashtags so that people can find you easily. Check out the social media sites of businesses you would like to do work for, and leave comments leading back to your pages. The more you post, ideally several times a day, the more chance you have that people will find you.

2. Attend networking events regularly

Depending on your location, you should be able to find regular networking events that you can attend to promote yourself. Websites like Meetup, Eventful, and even Facebook Events make it easier than ever to find something close to you that will be filled with the kind of people you want to meet. Be prepared with business cards, but don't jump right into your elevator pitch. Just mingle, get to know the people there, and when the conversation turns to the inevitable "So what do you do?" question, that's when you can promote yourself.

Don't be too pushy, keep it light, but make sure you leave a great impression and a way to be contacted. Even better, ask for their information and hit them up a few days later with a follow up. (See also: 11 Ways Freelancers and Telecommuters Can Make Friends and Network)

3. Speak at a conference

If you don't have a problem with public speaking, you should consider speaking at a conference. There are many different organizations and venues to explore, and it is fantastic exposure for you and your business. Speaking at TED is tough, but the local TEDx events are much easier to get into. They are well organized, extremely popular, and the TEDx talks get almost as much coverage as the bigger TED presentations. They are filmed and distributed via the TED website and app.

If that's not to your liking, find local (or national) conferences that are industry specific. For example, if you're in the design and advertising industry, HOW Design Conference, South by Southwest, and Advertising Week offer excellent opportunities to put you in the spotlight and reach new clients. (See also: How to Make Public Speaking Less Terrifying)

4. Do some spec work for a client you really want

Picture the ideal client list on your website. Who's on it? Who are you most proud of? Now, create something for that client that's better than anything you've seen out there. If it's an ad campaign, flesh it out. If it's a logo design, show it across a range of applications. If it's a website design, make it functional. Spec work like this can often lead to real work for that same client.

Now, it's important to note that this is work you will do to prove your abilities, and was not asked for by the client. This is more of a, "Hey, look over here, I'm really good," kind of deal. If a client approaches you asking for free work, that's another story. You should consider this carefully. Reach out to other professionals and ask them if it led to paid work. If not, they may simply be exploiting your talents. (See also: 8 Ways Freelancers Can Make Sure They Get Paid on Time)

5. Become friendly with freelancers in your field

While freelancers are often in competition with each other for the same business, they also know that it's important to have good contacts. For a start, freelancers with impressive client rosters can put you in touch with people who could provide regular work. Then, there's the case of overflow, or last-minute unavailability. If a freelancer has bitten off more than they can chew, you could become a lifeline.

How do you meet these fellow freelancers? Well, at the same places you'd meet clients: networking events, online forums, and group chats on Facebook. Be polite, ask for advice, and tell them you are looking for work. Sow these seeds now, and harvest the rewards later.

6. Check in daily at job boards

There are plenty of them out there now, including Upwork, Freelancer, Guru, Indeed, and Glassdoor. Plus, LinkedIn has a jobs section, and you can also create a Google alert for freelance jobs in your industry. Be wary of jobs that pay very little (such as postings on Fiverr, for example), as these are more like one-off projects that will rarely lead to anything substantial. Don't be afraid to pitch on multiple projects at the same time. The chances are, your success rate in the beginning will be low, so you'll want to improve your odds of landing a gig.

7. Consider an ad campaign on Google or Facebook

If you have the funds available, a well-written text ad targeted at the right demographic could bring in some great prospects for you. With both Google ads and Facebook campaigns, you dictate the amount of money you want to spend over a set period of time, and fine-tune the target audience so that the clients you're interested in landing will see the ads.

You will want copy that is search engine optimized, so if you are not savvy with SEO, find a copywriter to help you. You will obviously need to make sure that your website is completely finished, and you should also consider a unique landing page. This is first page that the potential client will see, and is a good opportunity to hit them with a bulleted list of your services and easy contact information. (See also: 8 Surprising Ways a Personal Website Can Improve Your Life)

8. Partner with an agency

Sometimes, the easiest and most convenient way to get new clients is to work with agencies that have already done the hard work. They have access to a wealth of accounts, and if you work directly for them, you can make the agency your own client and work on a diverse array of projects.

Advertising, marketing, design, and PR are some of the industries that cannot survive without freelancers. There are also agencies looking for freelance writers and bloggers, photographers, artists, and even carpenters and security guards. Do a search for agencies in your line of work, and don't limit yourself to local firms only. Many writers and designers have clients halfway around the world.

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This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

15 Lucrative Side Hustles for City Dwellers

Andrea Cannon — Wed, 09 Aug 2017 08:30:11 +0000

One of the benefits of city living is having easy access to a wide range of income opportunities. If you need to make some extra cash, these lucrative side hustles are the perfect way to take advantage of your city-dweller lifestyle. (See also: 14 Best Side Jobs for Fast Cash)

Use your car

In large cities, most people are stuck taking public transportation. If you're lucky enough to have a car, that set of wheels can be in high demand. There are several ways you can use your ride to bring in extra dollars. (See also: 7 Ways to Earn Extra Money With Your Car)

1. Drive people around

Driving for Uber, Lyft, or other ride-share companies can be a lucrative side gig, especially if you live in a large city. In fact, some drivers in big cities like New York report earning as much as $90,000 a year. If you don't feel like signing up for something so official, consider charging for transportation or carpool services in your neighborhood. (See also: How to Get a High Rating and Make More Money as an Uber Driver)

2. Deliver items

Whether it's delivering takeout or groceries, you can find food delivery gigs through sites like TaskRabbit, Instacart, Postmates, GrubHub, DoorDash, and UberEATS. If you have a pickup truck or cargo van, you can also charge to deliver or help move large items through services like Buddytruk and GoShare. The salary ranges based on where you live, courier availability, and overall demand. According to Glassdoor, Postmates couriers make an overall average $11.37 an hour, while Instacart shoppers make an average $12.15 an hour.

3. Rent out your car

If you don't drive your vehicle much, put it to work for you. Use sites like Turo and Getaround to rent out your car while you aren't using it. You can set your own daily price or choose automatic pricing. You could potentially make up to $10,000 a year, according to Getaround.

4. Use your car to advertise

If you live in a heavily populated area, companies like Wrapify and Carvertise will pay to lease ad space on your car. They do this by applying laminated decals to your vehicle, turning it into a billboard on wheels. Carvertise pays qualified drivers $100 per month, and all you have to do is drive the vehicle like you normally do.

5. Rent out your parking space

In cities like Los Angeles and New York, parking lots charge upward of $200 and $800 per month, respectively, for an available parking spot. If you have an extra space in a driveway or private lot, sites like JustPark can help you find interested drivers who need a place to leave their car.

Rent your space

If you live in a big city, your home may be in high demand for tourists and out-of-towners.

6. List your place on Airbnb

If it works with your schedule, consider renting out your home, or even an available room, on Airbnb. While you can potentially make a considerable income, you'll also need to factor in the associated higher utility costs and cleaning fees before determining what your revenue will be. (See also: 5 Easy Ways to Make Good Money From Airbnb)

Offer your acting talent

If you live in an entertainment mecca, like Los Angeles or New York City, you can get paid just for being you.

7. Become a background actor

Anyone can sign up to be a nonunion background actor (or "extra"). Television, film, and music video sets are always looking for background actors of all sizes, ages, and, well, backgrounds. If you live in New York City or Los Angeles, you may be able to make quite a bit of money just by being present in the background of different sets.

In most cases, you will get paid a guaranteed nonunion rate of $80 for the day (according to Central Casting), will be fed onset, and may be eligible for pay bumps due to small things like being near smoke. There is usually quite a bit of downtime, so you may be able to multitask. Sites like Central Casting and Casting Networks Inc. can get you started.

Sell your local expertise

As a knowledgeable local, there are a variety of ways to offer your expertise about your city.

8. Start a blog

If you're interested in writing about your city, you may want to start a blog that offers your insight, opinions, and recommendations about things to do or see in your area. If you earn a decent following, you can monetize the blog and see some passive income roll in. This can be lucrative over time, but just note that you likely won't see a large payout until you've built up your content and an audience. (See also: 5 Easy Ways to Make Extra Money Blogging)

9. Become a tour guide

If you live in a popular tourist destination, and you know your city well, then you can make some money as a tour guide. You can also explore some of your passions with this side hustle because there are so many different types of tours now available. For instance, you can lead a bike tour, food tour, walking tour, or Segway tour. The hourly pay for a tour guide can vary drastically depending on the gig and location, so explore your options to find the best fit for you. (See also: Make Money in Your Hometown: Become a Tour Guide)

Be a home helper

In large cities, there is high demand for people to help around the house and with the kids.

10. Become a dog walker

You can offer your dog-walking services to friends and neighbors, advertise on Craigslist, or sign up with a site like Wag! Angie's List estimates that you can make up to $30 for a 30-minute walk. (See also: How to Make $400+ a Week as a Pet Sitter)

11. Be a baby sitter or nanny

In large cities, baby sitters and part-time nannies are always in high demand. If you are good with babies and children, consider offering your services through sites like SitterCity or Care.com. According to a Care.com survey, the national average salary for baby sitters was $13.97 per hour as of 2016 — but this amount will vary based on where you live.

12. Become a house sitter or housekeeper

Opportunities for house sitting or cleaning abound in large cities teeming with busy professionals and families. You can offer your services through sites like HouseSitter.com or Housekeeper.com. According to Housesitter.com, most house sitters charge between $25 to $45 per day. According to PayScale, housekeepers make between $8.05 and $15.56 per hour.

Sell your services

In a big city, there are many more opportunities to take advantage of the gig economy.

13. Do someone's personal shopping

Sell your knack for style by becoming a personal shopper through sites like Thumbtack. If you're a shopaholic, imagine making an average $14.32 per hour (according to Indeed.com) just for shopping for a busy city-dweller who can't find the time to do it themselves.

14. Offer your interior decorating expertise

According to PayScale, interior decorators can make anywhere from $11.15 to $74.67 an hour for their services. It all depends on where you work and the type of clientele you take on. You can conveniently offer your interior decorating services through sites like Houzz.

15. Give music or dance lessons

Cities with big entertainment offerings, such as Los Angeles and New York, have much higher demand for dance instructors, vocal instructors, or professional musicians who want to share their expertise. Advertise lessons on Craigslist or Facebook, and tap your network of friends and family members. A few students per week can bring in decent side income.

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This article is from Andrea Cannon of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

10 Work Perks You Can't Get as a Freelancer

Dr Penny Pincher — Mon, 08 May 2017 08:30:07 +0000

In some industries, the number of gig economy workers is growing faster than the number of payroll employees. Working as a freelancer certainly does have its advantages, the biggest of which are flexibility, freedom, and the ability to experience variety in your work.

But if you find yourself staring at the walls of your cubicle, daydreaming about escaping the 9-to-5 and finding freedom as a freelancer, don't overlook the perks you could be getting at your regular job, right now. It may not be so easy to leave these things behind.

1. Stable income

One of the biggest benefits of a regular 9-to-5 job is the steady paycheck. As a salaried employee, you can plan your budget based on a stable stream of income. As a freelancer, your income can vary significantly from one month to the next. A few slow weeks can throw your finances into disarray, so you'll need to shift your entire budgeting strategy to make sure this doesn't happen. (See also: The Smart Way to Budget on a Freelance Income)

2. 401(k) match

Many traditional employers offer matching contributions to 401(k) plans. In other words, when you make a contribution to your retirement fund out of each paycheck, your employer will also contribute something. This is free money, and can total thousands of dollars each year. In the gig economy, you won't get this kind of assistance building your retirement fund. You'll need to make efforts to save for retirement all on your own, such as with an IRA or solo 401(k). (See also: A Simple Guide to Retirement Plans for the Self-Employed)

3. Retirement counseling

Employers frequently offer training or educational programs to help workers plan their retirement investment strategy. Often, they'll even provide free access to financial planners to answer questions. Freelancers are on their own to figure out the road to retirement, and consulting with financial pros will have to come out of your own pocket.

4. Health Savings Account

A valuable benefit that many people miss out on is participating in a health savings account. Every paycheck, you can contribute pretax dollars to be used for health-related expenses. Some health savings accounts allow the funds to be placed in investments where the money can grow until it is needed. As a freelancer, you may be able to set up your own health savings account, but you will need to do a lot more research than someone who simply signs up for an established program through their 9-to-5. (See also: How an HSA Saves You Money)

5. Paid vacation and holidays

Paid time off is an undisputed benefit of a regular 9-to-5. As a freelancer, you don't earn a paycheck while on vacation or holiday. If you want time off, you take time off from earning any income, too. This can certainly put a damper on enjoying your down time.

6. Making connections

As a 9-to-5 employee, you'll have opportunity to build relationships with the coworkers and senior-level staff you see every day. These connections can give you a special level of access to approach and meet other influential people in your company. Plus, it never hurts to have a few people to chat with as you pass the day. Freelancers can still find plenty of opportunity to network, but they'll need to go out of their way to make it happen. It won't be as simple as showing up to work.

7. Tech support and replacement

I have thousands of dollars worth of computer equipment sitting on my desk. It gets supported, maintained, and upgraded by my employer. As a freelancer, you are on your own to buy and support your technology needs. Do you need a special monitor? You'll need to shell out for one. Is your computer too old to do the job? The replacement comes out of your pocket. If something breaks? The repairman will be billing you directly.

8. Training, certification, and professional development

Companies often invest in their employees by providing training or certification programs to help them be better workers. Staying up-to-date on skills, technology, and industry trends is incredibly useful to the employees as well, and makes them more valuable in the marketplace. Freelancers will need to find, purchase, and commit to their own training. It can be very easy to rest on your laurels and let your skills become outdated, especially with no boss insisting you keep learning.

9. Awards and recognition opportunities

It looks great on a resume to list awards and other work honors that you have received. Many employers have some form of "employee of the month" or similar recognition. You may not be able to stock your resume with such accolades if you go out on your own. At the very least, you'll have to seek out and apply for awards, where you'll likely be up against a much larger pool of talent.

10. Employee discount programs

Another perk that businesses offer their employees is discounts on products and services. These can range from cellphone plans, to personal computer purchases, to fitness club memberships — even discounts on concert and amusement park tickets. As a freelancer, you'll miss out on these discounts.

This article is from Dr Penny Pincher of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

8 Ways Freelancers Can Make Sure They Get Paid on Time

Kentin Waits — Thu, 04 May 2017 09:00:08 +0000

After 10 years working for various digital marketing agencies, I jumped ship and went freelance in 2005. Though making the switch was stressful, I've never looked back. Freelancing has given me control over my schedule, put an end to my mind-numbing commute, and allowed me to work from anywhere. (See also: 7 Things I Learned About Money After I Went Freelance)

Of course, all that freedom assumes one big thing — that I'm getting paid on time. If late payments are derailing your freelance dreams, listen up. Here are eight ways to make sure you always get paid on time:

1. Track everything

Getting paid on time starts with you. That's why organization is one of the life skills every freelancer needs. Keep meticulous records of all work completed and the payment status of every invoice. I rely on a basic Excel spreadsheet that's organized with the following headers: Client Name, Project Description, Hours/Rate, Amount Invoiced, Date Invoiced, Date Payment Received, and Notes (for tracking important communication with clients and the dates any payment reminders were sent).

2. Invoice immediately

To get paid promptly, you have to invoice promptly. Waiting weeks or months to invoice exposes you to client-side staff turnover, shrinking budgets, and sometimes even insolvency. Strike while the iron is hot. Unless you've made other arrangements, send a detailed invoice within 48 hours of completion of the work.

3. Tighten up the terms

Avoid confusion about payment terms by making them a standard part of your invoice template. Some variation of "Payment is required within 30 of receipt of invoice. A late fee of 5 percent will be assessed each month payment is past due" will usually do the trick. Oh, and be sure to include your contact information on every invoice. You always want your phone number front and center in case a client has billing questions.

4. Pave the way for easy payment

Encourage quick payments by making things easy. Set up a PayPal account or work with other payment apps like Google Wallet or Wave, which allow clients to pay online with a credit card. Though there's a nominal fee to process payments, it's well worth the immediacy and convenience.

5. Be kind, remind

Though some freelancers send follow-up reminders for every invoice (whether payment is late or not), that seems a little heavy-handed to me. Focus on what's unpaid and keep the tone of your message friendly and positive. Remember, the goal is to facilitate payment, not ruin a relationship.

6. Levy a late fee

Applying a late fee to past due payments is sometimes a necessary motivator. To minimize ill will from valued clients, make sure your late fee structure is modest (say, 5 percent each month), consistent, and clearly stated in the payment terms on every invoice.

7. Polish your professional image

If late payment is an ongoing problem, maybe your business isn't being taken seriously enough. Upgrade your image and work on how you present your business in all communications — including invoices. Download a free invoice template, tailor it to fit your needs, and add your logo. Better yet, create, track, and manage invoicing with a service like Freshbooks or Zoho.

8. Set up a retainer

Retainer agreements are simple work contracts. They provide freelancers with a recurring and predictable source of income, while at the same time allowing clients to reserve your services for extended periods of time — usually in preparation for big projects. Though invoices are still required in most retainer arrangements, they don't drive the payment process. For repeat clients, suggest establishing a retainer and offer an incentive. I reduce my hourly rate by 10 percent for all work completed under a retainer agreement of three months or longer.

In the freelance world, getting paid on time takes the same skill set that built your business in the first place: an obsessive attention to detail, a big dose of diplomacy, and a touch of ingenuity. Still need some motivation to speed up those slow-paying clients? Just remember how terrible your commute used to be. It works for me every time.

This article is from Kentin Waits of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

4 Big Business Accounting Tools Every Side Gig Needs

Kat Tretina — Fri, 21 Apr 2017 08:30:15 +0000

While side gigs are becoming an increasingly common way for Americans to bring in extra income, many people do not understand how that additional income can affect their taxes. If you're not prepared, freelancing or working on the side can lead to serious issues with the IRS, costing you thousands in penalties and fees.

If you plan on taking business deductions for expenses, you'll need some tools to manage your reporting and minimize your tax headaches. Treat your side hustle like a small business. Below are four business tools you should use to keep your side gig from overwhelming your finances. (See also: 6 Signs It's Time to Make Your Side Gig Your Career)

1. Business bank account

If you have a side business, you should seriously consider opening a dedicated business bank account. It will make tracking your expenses and profits so much simpler, which makes tax time simpler as well.

Keeping your business and personal finances separate is not just easier, it's also important. Should the IRS ever take a closer look, you want them to see a clear distinction between personal and business expenses, as well as all of the business income you've earned. Jumbling this together with your personal banking is a recipe for confusion and possible contention.

Having a business bank account lends you more professional credibility, too. Asking a client to write a check to your business, for example, feels much more legitimate than having them make it out to your name.

All of the business income you earn doesn't have to stay in your business bank account. You can pay yourself the appropriate amount after considering taxes and expenses. Simply transfer that money to your personal account, and leave the rest in your business account.

2. Business credit card

Similarly, it's a good idea to have a separate credit card you use solely for business expenses. (See also: When You Should Get a Business Credit Card Over a Consumer Card)

By having a card solely for your side gig, you will be able to manage your business deductions quickly and accurately. When you do your taxes, or if you work with a tax professional, you just need your credit card statements to get an accurate picture of your expenses and deductions. Some business cards even offer special reporting tools that automatically itemize your spending for you. This can greatly streamline your accounting process and save you some trouble come tax time.

Many business credit cards offer other unique benefits, such as extended warranty protection and rewards targeted specifically for business-type purchases. They also tend to come with higher limits than personal credit cards. If you need to make a substantial business expense but don't want to dip into your own savings or take out a business loan, these higher limits can be a huge help. They're also a great way to build credit for your business, should you ever need a loan or other financing down the road. (See also: The 5 Best Credit Cards for Small Businesses)

3. Invoicing system

While you can find free invoice templates online and create your own in Microsoft Word or Google Docs, it's a good idea to use a professional invoicing system. Invoicing software tracks clients, invoice numbers, and your profits. They are more accurate than something you create on your own, and they look more professional than the do-it-yourself approach.

And you don't have to spend a lot of money to create polished invoices. There are a number of free and low-cost bookkeeping programs out there that are designed specifically for freelancers and side hustlers. PocketSuite, Freshbooks, and Wave are excellent and no-cost options that can help streamline your business management.

4. Tax professional

While many people opt to do their own taxes, when you add a side business to the mix, a tax professional can be a huge asset. When you're self-employed or freelancing, even on a part-time basis, you owe self-employment taxes, which can be complex and confusing. You'll receive forms 1099-MISC from any clients that have paid you more than $600 during the tax year. If you receive a 1099-MISC, you have to pay self-employment taxes. Not to mention if you add expenses in the mix, you'll want to make sure you are claiming the proper deductions.

Tax professionals can help you navigate paying estimated quarterly taxes, or calculate how much money you need to withhold from your main job's salary to avoid paying quarterly taxes. They can also identify deductions and credits you may be eligible for, such as a home office or education deduction. These are substantial tax breaks that no self-employed individual should overlook. You want to be sure you're claiming any deductions or credits accurately in order to receive the maximum benefit possible. A tax pro can help you do this.

By working with a professional, you'll have overall peace of mind and avoid any surprises at tax time.

This article is from Kat Tretina of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

8 Ways a Side Hustle Can Advance Your Career

Paul Michael — Wed, 08 Feb 2017 10:30:32 +0000

Some people call it moonlighting. Others call it a "hobby that pays." Whatever you call your side hustle, it's not just something that can bring in a little extra cash. A side hustle can be a valuable addition to your main career, giving you skills and connections you would never normally acquire.

So the big question is, if you don't yet have a side hustle…will these eight benefits inspire you to get one? (See also: 15 Ways to Make Money Outside Your Day Job)

1. Learn Valuable Project-Juggling Skills

Handling several projects at once may well be part of your current career. However, once you add in the additional work from your side hustle, you go from being a moderate juggler to a master of the art.

With a side job, your schedules might clash. And when that happens, you can't really tell your boss that you can't do the work because you have an extracurricular project on your plate. With a main career and a side hustle, you become an expert in time management and scheduling. You also learn, quite quickly, how much you can take on without burning out. These are all skills that will do you well in your main career.

2. Enjoy More Freedom at Work

A side job means additional money that isn't coming from your main career. While this has many benefits (the more different streams of revenue you have, the better), it also gives you something other people in the same role may not have — freedom.

The lure of money, or a promotion, can often make people do things they wouldn't like to do, but will anyway because of the need for additional income. If you already have that additional money from another source, you can say no to some of the projects you aren't interested in. You can speak up in meetings without fearing that your pay raise may be on the line. In fact, some people have discovered that this actually helps their career, with their newfound ability to be honest and confident actually helping them get a raise or promotion they otherwise would have missed out on.

3. Stand Out From the Crowd

This is a hirer's market, in almost every industry. Demand for jobs is outpacing supply, and when that happens, you quickly become engaged in a battle to be noticed. Why you? Why your resume? There are dozens, if not hundreds, to choose from.

Well, a side hustle can add much needed diversity and drive to your list of skills. Think about it. Two very similar people come for an interview, say for an account executive position. One has the usual skills, and the typical career path. The other has the same, but then you notice that they also have written articles for an industry magazine, and given speeches at major marketing events. On top of that, they have their own successful drop shipping business on eBay. One is clearly a go-getter, and can handle the pressure well. Plus, they have way more experience outside of work.

4. Add More Strings to Your Bow

Aside from simply standing out to prospective employers, your additional experience from side jobs can have a real impact on your current position. For example, someone may start at a junior position in a firm, with the very narrow set of skills that are required for that role. However, by taking on a side job, perhaps in a field quite different from their chosen profession, they may find themselves with brand-new abilities that really help. A lawyer who takes a side job doing acting in local commercials, or voice over work, suddenly finds that he or she has become a much more skilled orator in the courtroom.

This happens often in the fields of advertising, marketing, and public relations, too. Look for jobs that may not initially seem to fit, but have qualities that could reach into your chosen career. You may be surprised at the benefits.

5. Get a Great Confidence Boost

Success breeds confidence. If you become successful in your side hustle, it will seamlessly start to affect your main career. And so it should. If you were doing "just okay" in your main career, but suddenly found great success in your side job designing websites, or selling your own jewelry collections on Etsy, your confidence will get a much-needed boost. It won't take long for that confidence to influence your current role in your main gig.

Now, you have a little more steam in your stride. You're a little surer of your abilities, and your decisions. Before you know it, the success you found in your side job is being dwarfed by the successes you're having at work.

6. Open Up New Opportunities

Any time you move in professional circles outside of your main career, you are opening new doors for opportunity. If you have been in one company, and one role, for a long period of time, your contacts and business networks may be stagnant. They're good. But they're not growing. They're just the same "business as usual" leads.

However, your side job can open up dramatically different networks. And while you may think that the two cannot combine, don't be so sure. It's entirely possible to meet someone who has an interest in what you do as a main career, but who found you because you make awesome beer, or provide a killer cake baking service. Great business connections can come from all walks of life. They don't all have to come from the same pond.

7. Give Yourself a Second Career to Explore

A career now is not the same as a career 60 years ago. No one these days can expect to start at a company in a junior position and leave at retirement age with a gold watch and a big party.

Employment rules have changed. Technology is moving faster than any of us can really comprehend. And it is dangerous to have only one set of skills for one career. Your side hustle can be a huge benefit here. It can give you skills you would never get through your main career, and should the worst happen, you may be able to turn that side hustle into a full-time job. It's quite possible the job you do now, for a bit of extra money, will be your life preserver in a few years' time.

8. Find Fulfillment and Do What You Love

They say that if you do a job you love, you'll never work a day in your life. "They" don't all live in the real world. Most of us are not fortunate enough to do a job we love, day in, day out. There may be moments of joy, but often, it's a matter of going through the motions and waiting for the clock to wind down.

With a side hustle, you really can love what you do. Sure, it brings in a little money, but it can provide much greater benefits than that. It can be a creative outlet, or a way to meet new people, and enjoy new experiences. If you've always wanted to paint murals, but work in a bank…do both! If you love being a kids' entertainer, do parties on weekends. You can find fulfillment, if you really look for the opportunities.

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This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

My 2016 Budget Challenge: Reduce Debt or Save for an Emergency?

Max Wong — Fri, 23 Dec 2016 10:30:31 +0000

[Editor's Note: This is another episode in Max Wong's journey to find an extra $31,000 this year. Read the whole series here.]

Uh oh. Mr. Spendypants' contract is up. We anticipated that he might be out of work in mid-October and have been putting money into an emergency fund all year long for just this occurrence. The situation is not completely dire, as his company has paying work until March 2017. We have a very minor reprieve.

Very minor.

As luck would have it I am also under-employed. I got furloughed this week by not one, but two jobs until a date that has yet to be named in 2017. Ugh. Really? I guess it's not just me who is strapped for cash at the end of the year.

The big conversation Mr. Spendypants and I have been having all week is this: Should we continue to put money toward the $31,000 Budget Challenge, or should we put that extra money into our emergency fund in the event that Mr. Spendypants is unemployed come March and I am still under-employed?

The Argument Against Staying the Course

Who knows what impact the new administration will have on the economy? We currently have slightly over $13,000 in our emergency fund, enough to live off of for four months. But what if the job market tanks and we can't find jobs for six months or a year? Putting all our money into the emergency fund is obviously the less risky move.

The Argument for Staying the Course

Mr. Spendypants is really good at his job in video games. He's had his choice of companies to work for in the past. Also, the video game industry is fairly recession-proof because games provide cheap entertainment for the out-of-work masses. We do trust that with his talent and his 20 years of connections in the industry that he has a 90% chance of quickly finding another paying job, perhaps even before his current job ends in March.

Naturally, the real financial wildcard in this situation is me, Mr. Spendypants' deadbeat wife. If Mr. Spendypants can't find full-time work quickly, will I be able to get a job that pays me enough to cover 100% of our bills? Probably not.

That said, if push came to shove, we could definitely cover the mortgage with my current collection of little jobs. I will just have to freelance that much harder, with no weekends or evenings off. And, even if Mr. Spendypants couldn't find a full-time gig, he could also rustle up some part-time freelance work to cover the rest. The worst case scenario: He goes on unemployment and we have to stop putting money in our retirement fund every month.

Also, if we continue to aggressively attack our $31,000 debt instead of putting all the extra money into the emergency fund for the next two months, we're potentially saving money in the long run on interest. Our debt load won't be so bad if we find ourselves in a financial pinch four months from now. It's much easier to weather a financial downturn, be it personal or global, if you have a small nut to cover.

How to Hedge Our Bet

After a lot of discussion and number crunching, we have decided to stay the course and continue to put money toward both the emergency fund and the $31,000 budget challenge.

This is the riskier choice. To hedge our bet, we've decided to sell off anything in the house we don't totally love to make some extra money. This is a win-win situation for both of us. I get the hated clutter out of my house, and Mr. Spendypants gets more peace of mind.

Initially, Mr. Spendypants wasn't sure that we could make enough money selling used housewares to keep us afloat. Unlike me, he hasn't sold a lot of stuff online. When a copy of Kuon, an old video game that I had listed on eBay for $199, was snapped up in under an hour, he was convinced.

Although I would love to systematically go through our house Mari Kondo-style, Mr. Spendypants doesn't want to have to look at a giant stack of merchandise in the middle of the living room. As a compromise, we're going to do a series of mini-purges where we only pull the things that we can sell that week into a common area for sorting and packing. Since I will be the one managing our online inventory and sales, this means a lot more hunting and packing for me, but I'm not going to argue about it. I have been trying to get Mr. Spendypants to downsize since we moved into Dinky Manor eight years ago. If a little financial panic is what it takes for him to get rid of belongings that have gone unused for years, I'll take it.

Progress So Far

I had the death flu for most of October. One of the suckiest things about the gig economy is that there are no sick days for people who work from home. If I don't do work, I don't make any money. Because I was sick in bed through the middle of the month, I only made $324 creating a database for my real estate agent and $199 selling Kuon on eBay. I am now, also, two weeks behind on all my work, which is kind of a nightmare. The only positive thing about getting the flu is that I was too sick to go shopping for anything, even food, so we didn't actually spend any money.

While I was suffering at home, Mr. Spendypants was suffering at work. His schedule was so crazy, that his bosses ordered dinners in to incentivize him to work late. Between the long hours and the catered meals, he was too busy to go shopping for anything, even food, so he managed to sock away $1,101 from his paycheck.

Goal: $31,000

Amount Raised: $25,219.17

Amount Spent: $12,853.66

Amount Left to Go: $18,634.49

This article is from Max Wong of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Ways to Ease Into a Day Job After Freelancing

Mikey Rox — Thu, 21 Jul 2016 09:00:12 +0000

Freelancing gives you the freedom to set your own hours and work at your own pace. Some people consider this the ideal situation, and after making the switch from employee to freelancer, they vow never to return to the workplace. Of course, anyone's professional situation — the amount of money coming in to keep you fed and sheltered — can change in the blink of an eye, and some of us have to get a "real" job again. Sound familiar? Then listen up! Whether you're looking for steady, predictable income, or you're making a switch because you need benefits like health care, these are the ways to ease back into a regular daytime gig with minimal stress.

1. Find a Job You're Passionate About

Freelancers enjoy a freedom unlike any other, and after years of working for yourself, it can be difficult to ease back into a routine of punching a time clock and having a boss breathing down your neck. Getting a regular day job might be a necessity and not a choice. But even if you can't change your overall circumstances, you can be choosy when it comes to accepting a position. The transition from freelancer to 9-to-5 employee will be harder if you hate what you do. On the other hand, if you find a job that excites and challenges you, it'll be easier to get up in the morning and leave your house.

2. Seek Opportunities That Offer Flexibility

Nowadays, it's not unusual to see employers advertising flexible positions. Some employers recognize the benefit of telecommuting, and they allow certain personnel to work from home or only come into the office a couple days a week. If you prefer the stability of a steady paycheck, but you want the ability to work independently, seek opportunities that provide the best of both worlds.

If telecommuting isn't an option, it'll also be easier to ease back into a regular day job if you find a position that lets you work at times when you're most productive. Maybe you perform better when able to start your workday in the late morning or the afternoon. Although a 9-to-5 work schedule is common, it's not the only option, and you'll find that many companies offer their employees a variety of schedules.

3. Split Your Time Between a Regular Day Job and Freelancing

Another option is splitting your time between a regular day job and freelancing. A regular job can provide the income stability you need, but enjoying this stability might not require a full-time gig. Rather than jump head first into the full-time grind, work a few hours with an employer and freelance for the remainder of the day to supplement your income. For this approach to work, you'll need a few regular freelance clients who can provide a steady stream of work. Easing into a day job is easier when you're only working four hours a day.

4. Pace Yourself

Successful freelancers are hard workers and they wear many hats. They spend their days working on projects, hunting for new clients, invoicing, handling client issues, and some freelancers have multiple income streams to make ends meet. It's a busy, hectic life, and it's easy to develop a pattern of always being in work-mode and constantly hustling.

Working at this pace can become a normal part of your daily routine — to the point where you forget how to work at a slower pace. As you ease back into a regular day job after years of freelancing, you may bring a few bad habits with you, such as working until you're numb, never taking a break, or thinking you have to accept every opportunity you're offered.

While you'll want to be a team player and take the initiative on your new job, you have to remember that the company's success doesn't lie on your shoulders. Pace yourself or else you'll burn out.

5. Stick to a Regular Sleep Schedule

Some freelancers don't start their workdays in the morning. Instead, they begin working in the late morning, afternoon, and some don't work until the evening hours. If you're a night owl and used to sleeping in, the transition from freelancer to employee is especially challenging when you have to rise early and be at a desk by 8 a.m.

This doesn't mean you have to hit the sheets by 8 p.m. after getting a regular day job, but you will need to get enough sleep to wake up on time and function during the day. Being in a constant mental fog because you didn't get enough sleep, and running late every morning only prolongs the adjustment period.

Easing into a fixed, eight-hour schedule after years of a flexible, non-fixed schedule can leave you physically and mentally exhausted. Getting plenty of sleep and staying active makes a difference. Walk on your lunch break or pace your office for a couple minutes every hour. Activity can increase your energy and improve your mental and emotional health, which can be the mood booster you need to accept your changed circumstances.

Have you recently made the transition from freelancer back to a more structured position? How has the transition been? Share with us in the comments below.

This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

My 2016 Budget Challenge: Does Taking a Regular Day Job Mean Giving Up?

Max Wong — Fri, 24 Jun 2016 10:00:05 +0000

[Editor's Note: This is another episode in Max Wong's journey to find an extra $31,000 this year. Read the whole series here.]

Although most people hate their boring job, there is something to be said for mindless labor — at the end of the workday, you can leave the job at the office. I am currently looking for a regular, turnkey job, and money is not even the first reason why.

I Am Tired of Thinking

I know. This seems like a stupid thing that only a stupid person would say. But I am really tired at the end of every day. Like, my brain is worn out. And, when I wake up in the morning, I don't feel mentally refreshed. In fact, my first thought upon waking is a rundown on that day's To Do list, which is basically the list of what I didn't finish the day before.

Other than having no benefits like health care or a 401K, the biggest drag about my current battalion of creative, freelance jobs is that I have to do 100% of the brainwork. I have to write the stories for Wise Bread. I have to organize the photo shoot. I have to make the jam. If I worked a standard service job, I would have time between customers for reflection or even daydreaming. With my current work, I have no time to work through complex problems or innovate. My creative jobs are actually preventing me from being creative.

Yes. This is a first world problem. Most definitely.

Getting Paid by the Gig Is Actually a Problem

I love beekeeping because bees are endlessly fascinating. There is rarely a day that goes by that I don't learn something new about bees or how to keep them. Unfortunately, bees wait for nobody. I have pretty much given up trying to schedule around beekeeping jobs. Also, depending on the size and the grumpiness of the hive, the simplest beekeeping tasks can take five minutes or five hours. While the master beekeeper I assist tells me that I will get better at assessing the work flow as I level-up as a beekeeper, right now I get paid the same for swarm capture jobs whether I get stung once or 20 times.

The days that I get stung 20 times are the days I wish I had a salary.

My Random Payment Schedule Is Annoying

I spend all day harvesting lemons and making marmalade on the assumption that I will be able to sell it. While my profit estimates are usually accurate, the schedule of payment never is. Sometime I sell out of jam in 48 hours and sometimes it takes months for me to sell 100 jars. I know that I will make $4,000 in profit if I sell my entire summer harvest of honey, but I might not make the brunt of those sales until Christmas rolls around. Meanwhile, I still need $423 by next week as the minimum payment on my bank loan.

Okay, thanks for letting me get all that whining off my chest.

Hooray! Three Job Offers

I had the most peculiar Monday. I got three job offers in one day.

I woke up to the first job offer. A tech startup wants to hire me to write content for their blog. It's an intriguing company — working in affiliate marketing — a white-hot space right now. Creatively I said yes, but financially, I said no. The company isn't funded, and I currently can't afford to take a spec job for someone else. If I am going to work for free, it has to be for me.

I am sure I am walking away from a million dollar opportunity.

The second job came through a knitting buddy who has created a probiotic cookie that Los Angeles foodies are going crazy over. She's never run a company and needs someone to be her factory manager. Although I have experience working as a private cook, I don't have the mass production experience she needs to make the jump to the big leagues. With my family's restaurant background, I feel like I could probably figure out what she needs to do to get her product into Whole Foods. Even though a salaried job is so tempting, I know that running any kind of food-based company is a 24-hour job that will take over my life and brain. I don't take her up on the job, but I do take her up on the offer of free cookies. I need probiotics. And cookies.

I am sure I am walking away from a million dollar opportunity.

The third job came from my sister who is an illustrator. The company she works for is short on freelance inkers. Since I have never worked as an inker, I am naturally worried that I will fail spectacularly at the job and bring shame upon my entire family.

Here's her assessment of my skills: "I think you're going to get this. Your obsessive tendencies and perfectionism…well, you are like a meth user without the meth. Those are the makings of a good freelance inker. How fast can you learn Adobe Illustrator?"

That's comforting, I think.

My sister hadn't considered me for the job before because she thought I would get bored with the assembly line aspect of the work. But then she discovered that her boyfriend's brother just made $50,000 in two months working as a freelance inker. Granted her boyfriend's brother is like a cyborg with a stylus and is super fast on Adobe Illustrator, but if that guy could make $25,000 in a month, I could at least manage that amount of work by the end of the year. This is my sister's plan to help me make my $31,000 budget challenge.

What makes me think this is the dream-come-true, turnkey job isn't even the pay, it's my sister's description of the work: "It's mindless, but never boring. It's relaxing, like coloring."

It's times like this that I could kiss my fine arts degrees. And my sister.

Progress So Far

My husband managed to save $600 from his last paycheck. I made $410 from writing gigs and $15 running an errand for a neighbor. While we didn't earn much this pay period, we managed to spend $0 in the last two weeks because we were both submerged in work.

Goal: $31,000

Amount Raised: $19,905.84

Amount Spent: $10,653.66

Amount Left to Go: $21,747.82

This article is from Max Wong of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

The Smart Way to Budget on a Freelance Income

Claire Millard — Wed, 20 Apr 2016 09:30:26 +0000

If the 53 million freelancing Americans agree on one thing, it's that their lifestyle gives an unbeatable level of flexibility, and can be an extremely lucrative working model. If there was a second thing the global freelance community might agree on, however, I would bet that it's the fact that managing your money as a freelancer can be a nightmare.

With income varying month by month, budgeting can be tricky — but having a solid budget is all the more important because of the normal fluctuations of income most freelance workers experience. So how do you go about setting a budget as a freelancer? The following steps can guide you.

Step One: Determine What You're Spending

Before you can start creating a budget, you need to get a picture of how your spending looks today. Set a challenge for yourself to record all your expenses over the course of a month. This could be using pen and paper, collecting receipts, and then adding them all up later, or using one of these great spending tracker apps.

Once you have some measurable data about your spending patterns, group different expenses together, and add in the known costs that did not occur during your test month. If you pay annual insurance premiums, or other annual bills, for example, divide the total by 12, and add that figure to your monthly calculation.

As an example, you may put together the following categories:

Housing — rent or mortgage, utilities, insurance
Debt — credit or store cards, student loans
Transport and commuting — public transit ticket costs, or car loan, petrol, parking and servicing costs, as well as any insurance you pay
Taxes (As a freelancer this is especially important!)
Savings
Personal expenses — food, phone bills, vacations, clothes, gifts, parties, and regular health costs
Fun — all entertainment

The categories you choose will vary according to your lifestyle, but by grouping them like this, you have an overview — which is helpful if you later decide you need to trim the budget a little.

Step Two: Create a Baseline Budget

Your goal now is to create a survival budget, and an ideal budget. The survival version is your baseline, and should not include any unnecessary costs. This is your worst case scenario information about how much you need to spend, even if there is a problem and you're out of work for a while.

The ideal version can be much more relaxed — covering your preferred spending levels and any discretionary spending on hobbies and entertainment.

Scrutinize your recorded spending by category. Remove any optional costs, and add the categories together for your baseline monthly budget. Once you have done this, you can put the fun stuff back into your budget — along with your preferred levels of saving, and any discretionary spending, like donations to charities. You should now have a monthly total for your minimum and ideal levels of spending.

Step Three: Optimize Where Possible

Now is the time to look at your monthly income. As a freelancer, this might vary significantly month-to-month, so taking your annual income and dividing it by 12 for an average can make the process easier. If you are more risk averse, or have little or no financial cushion at the moment, then you may choose to take your lowest month's income as your model instead of an average.

How does your monthly income match up with your projected baseline and ideal budget? This exercise should give you a view of how realistic your figures are, but if your income falls below your survival budget, then you need to think about how you can make the numbers match.

Are there other items you can remove from your budget, or can you reduce regular costs such as utilities or insurance premiums? Alternatively, can you bring in some extra income on top of your usual workload to help balance the books?

Step Four: Pay Yourself

Set yourself a trial budget, factoring in both your expected income and your necessary expenses. If it looks like you can be quite comfortable on the income you expect on a monthly basis, then go with your ideal budget. But if you're concerned, then try the baseline budget for a while to see how it works out.

Whichever spending level you go for, pay yourself a paycheck to help you smooth out the ups and downs. You could do this quite literally, by billing clients to one account and transferring only a fixed amount to your main spending account on a monthly basis.

Your aim is to even out your spending, so any additional income you make in a lucrative month can be saved, and added to an emergency fund or used as a financial cushion for periods when income falls.

Step Five: Make a Long-Term Plan

If you're able to earn enough to support your chosen lifestyle, then over time you will be able to create a financial buffer and build savings. If you use any extra income mindfully, rather than allowing your spending to creep up without noticing it if your earnings increase, then you can repeat the budgeting exercise as your personal circumstances and needs change.

More of us are now working in a freelance model, and studies suggest that anything from 40%–50% of workers will be working freelance by 2020. With freedom-loving Millennials quickly becoming the largest segment of the working population, this is hardly surprising. But with the struggles faced by freelancers trying to budget effectively, the Gen Y trailblazers already reshaping the future of work now need to turn their attentions to planning their finances.

How do you manage your freelance budget? Share your tips in the comments!

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This article is from Claire Millard of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

15 Ways to Make Money Outside Your Day Job

Philip Brewer — Thu, 19 Nov 2015 19:03:04 +0000

Extra money is great. At a minimum, extra income is more change in your pocket. Beyond that, it can diversify your income sources and make your finances less vulnerable to a disruption.

There are many types of non-salary income, but one way they're often divided up is passive versus non-passive. Consider these 12 sources of additional income.

Passive Income

Passive income tends to be investment income: Money you get for letting someone use your money or your stuff. Here are the classic categories of passive income. (By and large, this whole category is only available if you have money to invest.)

1. Interest

Interest is money you get from something like a bond, CD, or savings account, where someone pays you to use your money.

Not so long ago — before the financial crisis — there were plenty of reasonably safe interest-bearing investments that paid 3%, 4%, or even 5% over inflation. Those days are long gone. Now, CDs or bonds can barely beat inflation, and that's only if you're willing to tie your money up for a long time. Still, interest income can serve as a secondary income stream, and the opportunities are likely to get better in the near the future. (So, be careful about locking up your money for the long term at current rates.)

2. Dividends

Dividends are your share of the income earned by companies in which you own stock, and are also earned from baskets of investments that hold stocks, such as ETFs or mutual funds. Unlike the interest earned on a bond or CD, dividends can rise or fall unpredictably, depending on the success of the firm or the fund. Although some risky companies can pay high dividends, stable companies tend to offer modest returns, typically under 5%.

3. Rents

In theory, rents can be pure investment income, like interest and dividends, but in practice, being a landlord is more like taking on a second job — you have to find tenants, accept rent payments, keep the building maintained, deal with broken appliances, and so on. You can hire a management company to do that work, but that's an extra expense — and the income still isn't purely passive, because you still have the work of managing your relationship with the management company.

Still, rental income can be an incredibly flexible second income stream. Airbnb, RelayRides, and similar companies now enable individuals to rent out things like spare bedrooms, vehicles not in use, and earn extra income with less effort.

4. Royalties

Royalties are money that you get for letting someone make more limited use of something that you own. If an oil company operates a well on your land, they'll pay royalties. If a publisher sells a book that you wrote, they'll pay royalties. The possibilities are vast, and in essence include anything people can use — land, books, photos, patents, trademarks, etc.

It's worth noting that most people who sit down to write a book don't end up getting any significant income from it. That's probably even more true of people who sit down to invent something. Still, books, online stock photography, and even less-successful inventions can all generate extra income and diversify your earnings.

Non-Passive Income

Non-passive means you have to get out there and hustle up this extra income in your spare time. Some take a lot of hustle.

5. Working Another Regular Job

For someone working for wages, a second (or third or fourth) job is a classic source of extra income. If you're working for a salary, you'd probably be breaking your employment agreement to work another job, but there are ways to work for pay without breaking the rules. Check with your employer to determine your company's specific policies.

6. Working at an Irregular Job

Not all jobs require a regular time commitment. Some can be done on an ad-hoc fashion, such as:

Casual labor, like a handyman, house painter, gardener, house cleaner, or dog walker.
Freelance work (usually skilled or semiskilled labor done outside the range of regular employment), such as a web designer, photographer, adult education instructor, bicycle messenger, etc. Many occupations that fall into this category require special training, certification, or even licensing.
Seasonal work, such as a department store Santa, sheep shearer, etc.

7. Service Something That Makes Money

The classic option here is a vending machine. Your investment is modest — the cost of the machine, and the cost to stock the machine the first time. Your labor is modest — visiting the machine to restock it and remove the cash.

Vending machines used to be a great way to make a modest amount of money, especially if you knew someone who would let you put a machine in a reasonably high-traffic area either for free, or for a piece of the action. You could start small and then buy more machines. Back in the day when coin-operated video games were a thing there wasn't even any restocking needed — you just went as often as necessary to take out the money.

8. Running a Small Business

Running a small business can be a great way to make money from a source other than your salary. The range of options for small business are infinite. Just for starters, virtually all the "irregular job" items from the previous section could be just as easily arranged as a small business. Instead of painting houses or walking dogs, you start a house painting or dog walking business. Plus, running a business may confer certain tax advantages (deductions, anyone?) which can make it an even healthier secondary income source. The next two ideas can also be structured as small businesses.

9. Sell Something You Make

The list of things you can make and sell is endless — jellies and jams, soaps, jewelry, garden produce, baked goods, maple syrup, pottery, scarves, etc. I wrote a bit about the line between hobby and small business in my post Make Your Hobby Pay Its Way.

10. Sell Copies of Something You Made

This is a variation on the point above about royalties. Instead of letting another company sell copies of something that you've created in return for royalties, you can sell the copies yourself.

The classic case is self-publishing a book, but there are a lot of other possibilities that fall into this category. For example, If you know how to do something, you could create a video teaching how to do it, and then sell it on DVD.

This option really lends itself to digital sales, because the cost of production is zero — ebooks, online video courses, phone apps, etc.

It's tough to make much money this way, because there's so much stuff out there already, often for free. Sales are likely to be low, and unless you have a very narrow, very focused niche, you're going to face a lot of competition.

Still, this can be a win, especially if you want to create something for your own reasons — a phone app that does something you want a phone app to do, a drawing that speaks to you, etc. If you're making the thing because you want to, the extra effort to sell copies is quite small, and will probably bring in a little money.

11. Sell Something You Gather

There are still places where it's legal to collect things and sell them — mushrooms, pine boughs, sea shells, rocks, insects, etc. Success requires access to a place where you can collect, and usually requires more than a little skill in knowing what's worth collecting, and how to sell it.

12. Sell Something You Buy

If you can buy something cheap and sell it for more than it cost, you can make money on the markup. To make a reasonable profit, you usually have to add value in some way. The two classic ways are: Import the item, or repackage a cheap, bulky item into smaller units.

Importation: Say you find something sold overseas that you really like — a clothing item or a gadget or a tool — that just isn't a thing in the U.S. You can find the manufacturer, buy a modest quantity at wholesale, import them into the US, and sell them at a markup. Your added value is the capital to buy the stock and the effort handling the complexities of importation.

Repackaging: Almost anything is cheaper in bulk, sometimes a lot cheaper. My wife buys a brand of quilt soap that's good for washing wool. She can get it in 8-ounce bottles for $8 or $9 dollars — about $17 a pound. The stuff has a single ingredient: sodium lauryl sulfate, the detergent in baby shampoo. If you buy by the barrel, sodium lauryl sulfate costs less than $1 a pound — highly profitable, even after paying for bottles. Anybody can do the same thing with anything that's cheap in bulk but can be sold for more in reasonable quantities.

13. Teach a Class

If you have some skill — and if you also have some skill at teaching — you can make money offering classes. Where I live, people can arrange to teach classes through the park district, recreation center, the local library, YMCA, community college, and at least two different senior organizations. Many of the stores that sell arts or craft supplies also offer classes with local artists and craftspeople as teachers. And if you're adequately entrepreneurial, you don't need to teach under the auspices of some other organization at all. You can find your own students and teach out of a location of your choice.

14. Put Ads on a Website

Creating a blog or static website and putting Google Ads (or other affiliate programs) on it can generate extra income — just how much depends on the traffic and ad clicks your site generates. It's a competitive space, but if you can produce a quality site with adequate traffic, it may provide a regular source of additional income.

If you have some sales skills, you can also market your site to individual companies and get them to buy ads for a lot more money. That's another piece of work, however. It would make your income a little less passive, because now you're a salesman on top of everything else.

15. Create a YouTube Channel or Podcast

If you like making videos, this can be a source of modest income. If making videos seems like a lot of work, you're going to quit before you make any money from Google Ads on your YouTube channel. Still, if you make videos that go viral, there's the potential to make quite a bit of money. Some YouTube stars derive significant income from their videos.

Podcasts are a little more complex to monetize, because you don't have the option of just putting ads on the page somewhere; you actually have to include the ad in the podcast itself. On the other hand, the ads are worth more, because the listener is pretty much stuck listening to the ad from beginning to end.

There are podcast networks that offer tools to help with creating and making them easy for listeners to find. Some of them also have ad networks, although you'd probably make more money if you did the work of selling your podcast to sponsors.

How do you earn extra income?

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This article is from Philip Brewer of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Ways to Grow Your Savings Without a Steady Paycheck

Carrie Smith — Thu, 10 Sep 2015 15:00:27 +0000

Whether you're a freelancer or part-time employee, not having a regular salary can disrupt your progress toward big financial goals. Money fluctuations can mean you either have to stop the savings transfers, or withdraw money out of the account to cover bills.

But saving money without a regular paycheck isn't impossible, and with these tips you can learn to create a savings habit that sticks!

1. Separate All Your Savings Goals

Even if you have a separate savings account, it's too tempting to have all the money in one account while simply allocating the funds to different savings goals. For this reason I recommend opening a new savings account for each individual goal.

My husband and I recently did this as an experiment, and for two months in a row we've had a surplus of money in our bank accounts, and have been able to save money toward all of our goals. And we're both self-employed so you know how difficult this can be!

While it is possible to have too many accounts, this strategy works for us, and has allowed us to pay all of our bills, self-employment taxes, and save extra money toward various specific goals.

2. Pay Yourself a Regular Salary

As a freelancer, temp, or someone who works on commissions, it's still important to pay yourself a "salary" on a regular basis. I deposit a regular salary from my business account to the household account every Monday — no matter how little or how much my freelance business brings in.

Giving yourself a regular "paycheck" will help combat the inconsistent income that comes with being self-employed. It may take a few months for your budget to adjust to the changes, but it can drastically improve your finances and allow you to finally get into the habit of saving money.

3. Try a Microsaving Tool

Microsaving is when you save extremely small amounts of money — like $2 or $5 a week. As your budget adjusts to the savings, and you begin to see your small balance grow, you can increase the savings amounts. Next thing you know, you've saved a couple hundred dollars that can be used towards anything you want.

To make it even easier to save money without thinking, there are several different microsaving apps available that will put saving money into automatic mode.

Digit is a popular tool that allows you to start saving money via text message. Once you link your account, Digit will start withdrawing a few dollars every week and deposit into your new Digit account, based on your bank balance and only if you can afford it.
Acorns is a microsaving investment tool that helps beginner investors or students get their feet wet in the market. Everyone has to start somewhere and Acorn's round-up payment withdrawals makes saving money very easy.
SmartyPig allows you to create individual accounts for each savings goal and keeps you updated on the progress. You can also earn rewards, cash back, and gift cards as incentives to save money.

4. Find What Motivates You to Save

What motivates you to save money? Are you a competitive person who likes to turn saving money into a challenge? Find a few friends who will commit to a savings competition with you. Whoever reaches the goal first gets a free dinner, night out, or other incentive (paid for by the losers, of course!).

Are you an artist or visual person? Try mapping your progress by coloring in circles for each $50 or $100 you save. Whether it's goal tracking, paying off debt, or saving for a particular event, try coloring your way to reaching your goal. And when you've reached your goal you can hang the artwork in your home as a motivational reminder.

5. Join a Savings Challenge

Much like a diet helps you jumpstart your weight loss plan or workout regimen, a savings challenge can help you get your spending under control, and create a regular savings habit.

There are lots of different challenges available. You can go on a 14-day spending diet, a 60-day cash budget challenge, a year-long shopping ban. Last year I participated in a 12-month money challenge from inspiration I found on Pinterest. But the options are basically limitless, so start out small and then increase the challenge as you become more comfortable with it.

Experiment with different methods and test out strategies based on your money personality and saving style. Don't be afraid to try out new ideas to see how they work for you.

How do you save money without a regular paycheck? Share your best tips!

This article is from Carrie Smith of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

6 Gadgets Every Work at Home Professional Needs

Amanda Meadows — Mon, 29 Jun 2015 09:00:13 +0000

Desk jockeying from the comfort of your home? Make your home office way more awesome with these six gadgets. They can help increase your productivity, reduce boredom, and make working from home much easier.

1. Multi Device Keyboard

Need to switch from iPad to laptop, and back again without fumbling for cables or constantly restarting the Bluetooth connection? This multi-device keyboard makes it easy — as simple as turning a dial. It's wireless and completely mobile, making it easy to move around the house or pack on business trips.

2. Smart Light Bulb

I've been on spreadsheet grinds that go so long that when I look up, the sun's set and it's dark as a cave in my office. It's time to consider switching the home office lighting to the new GE Wink, which can be controlled by both your home dimmer and from anywhere with a smartphone app. Try one in your office and one in the living room, so you can brighten, dim, or turn off the light without having to leave the desk.

3. Bluetooth Headphones or Speaker

My Bluetooth speaker has been a lifechanger. When playing back a video for work, I can actually hear it without tethering myself to the computer with corded headphones. If you want a big sound for less, try the Photive Bluetooth speaker, which is by far the best value in the Bluetooth speaker market. It also holds a single charge for days.

For those who like lush headphones, these Jabra Bluetooth headphones are awesome. They're comfortable, have well rounded sound, and work within a decent range. You can finally enjoy work tunes and grab something from the fridge at the same time!

4. USB Key

This really handy USB stick by LaCie fits onto your key ring, but it's also shaped and sized like a key! This makes it lightweight and less bulky than your current USB drive. You'll also find it very hard to fill because it holds a sizable 32GB of drive space, making this the perfect goto on-the-go USB solution.

5. Desk Elliptical

Everyone knows it now: Sitting is a disease. But even if you work from home, you probably also need to work at a desk. There are options such as the standing desk, or the treadmill desk. But, If you want to remain sitting most of the time yet keep your blood flowing (perhaps even burning some extra calories), try this under-desk elliptical. It's compact, light, and easy to use. Plus, it's a great value compared to full-size home gym equipment.

6. Tylt Vu Charging Pad

This is really cool: An affordable and convenient home charging pad that's good for any smartphone. No more misplacing cords, then scrounging for them in a hurry when your phone is at 3% battery. It's also small enough to keep on your desk and take along on business trips.

What are some other gadgets you can't work from home without?

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This article is from Amanda Meadows of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

freelancing

7 Signs It's Time to Quit Freelancing

1. You don't enjoy it anymore

2. It's getting harder and harder to find work

3. You can no longer afford to pay for your own health care

4. You miss the interaction with other employees

5. You're bored and you're coasting

6. You can't make ends meet

7. The work-life balance is no longer acceptable

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Best Money Tips: Freelancing Myths That Can Derail Your Success

Top 5 Articles

Other Essential Reading

How to Land More Freelance Clients in a Snap

1. Take advantage of social media

2. Attend networking events regularly

3. Speak at a conference

4. Do some spec work for a client you really want

5. Become friendly with freelancers in your field

6. Check in daily at job boards

7. Consider an ad campaign on Google or Facebook

8. Partner with an agency

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15 Lucrative Side Hustles for City Dwellers

Use your car

1. Drive people around

2. Deliver items

3. Rent out your car

4. Use your car to advertise

5. Rent out your parking space

Rent your space

6. List your place on Airbnb

Offer your acting talent

7. Become a background actor

Sell your local expertise

8. Start a blog

9. Become a tour guide

Be a home helper

10. Become a dog walker

11. Be a baby sitter or nanny

12. Become a house sitter or housekeeper

Sell your services

13. Do someone's personal shopping

14. Offer your interior decorating expertise

15. Give music or dance lessons

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10 Work Perks You Can't Get as a Freelancer

1. Stable income

2. 401(k) match

3. Retirement counseling

4. Health Savings Account

5. Paid vacation and holidays

6. Making connections

7. Tech support and replacement

8. Training, certification, and professional development

9. Awards and recognition opportunities

10. Employee discount programs

8 Ways Freelancers Can Make Sure They Get Paid on Time

1. Track everything

2. Invoice immediately

3. Tighten up the terms

4. Pave the way for easy payment

5. Be kind, remind

6. Levy a late fee

7. Polish your professional image

8. Set up a retainer

4 Big Business Accounting Tools Every Side Gig Needs

1. Business bank account

2. Business credit card

3. Invoicing system

4. Tax professional

8 Ways a Side Hustle Can Advance Your Career

1. Learn Valuable Project-Juggling Skills

2. Enjoy More Freedom at Work

3. Stand Out From the Crowd

4. Add More Strings to Your Bow

5. Get a Great Confidence Boost

6. Open Up New Opportunities

7. Give Yourself a Second Career to Explore

8. Find Fulfillment and Do What You Love