8 Money Management Tips for Freelancers 💵

  • Remote Working & Freelancing
Contra Tips
· 6 min read

Learning how to manage finances is crucial for freelancers. We’ve got some money management tips to get you started.

In many ways, freelancers — as the name suggests — seem to have all the freedom in the world. They set their own schedules, work from wherever they want, and serve as their own task managers. Not surprisingly, it’s a juggling act of responsibilities, and there’s one ball no freelancer can afford to drop: finances. 

Being an Independent means making decisions non-freelance workers don't have to worry about, and those regarding personal finances are arguably the most important among them.

With some practice, Independents can learn how to manage finances, achieve financial stability, and set aside worry over bank accounts, leaving them free to concentrate on producing their best work.

The importance of budgeting for freelancers 📈

One of the best money management tips is to budget and track money closely. Overstating a budget’s importance is all but impossible. Sure, it may seem stressful or overwhelming at first, but finances become more manageable once a working budget is in place.

The benefits of making a budget and sticking to it include:

  • Spending more wisely. Smart money habits help reduce the stress often associated with spending, and establishing a budget lets you know when you can afford to splurge a little. After all, who doesn’t love to treat themselves every once in a while?
  • Reaching financial goals. Tracking income and expenses makes it easier to see where cuts can be made and resources reallocated to reach savings goals.
  • Preparing for emergencies. Whether it’s a busted water main or an unexpected trip to the hospital, nobody can predict when an emergency situation will arise. The best strategy is to prepare for the unknown with an economic safety net, something a budget allows for.
  • Setting rates and increases. A budget tracks how much money is coming in and where it's going, but it can also indicate when it's time to raise rates. That may not be possible mid-contract, but as an Independent, tracking income and rates is key to knowing when you’re ready to consider negotiating higher wages with your next client.

Figuring out how to save as a freelancer can seem challenging. Still, some simple tricks and suggestions make money management less intimidating, so you can start saving up for time off.

8 money management tips 💰

Many people have a knack for financial management, but to some, it might as well be rocket science. And that’s why establishing a budget is all the more important. Here are some tips on how to start, as well as tricks to make managing money simpler and easier.

  1. Track spending. Determine how much you're spending and where it's going to paint a clear picture of where changes can be made. Track credit cards, debit cards, and any other cash outlay. 
  2. Set a timeline. Set clear dates for financial goals. Rather than setting nebulous goals ("I'd like to be financially stable"), set precise numerical amounts. It helps to give yourself a concrete figure to work toward.
  3. Create a budget. Time for the main event. Luckily, the previous two tips are fundamental to creating a budget, so you’re already on your way. Once you know where your money is going, drafting a document for financial success becomes more straightforward. Understanding your current financial situation helps you plan for your desired financial situation.
  4. Keep up with taxes. Independents must withhold federal and state-level income taxes from their own pay — a task typically managed by an employer. Setting aside sums to cover taxes and fees keeps you out of a sticky situation once tax season arrives.
  5. Establish an emergency fund. Life is full of surprises, but sadly, they’re not always the fun kind. Whether it's car trouble or an unforeseen medical procedure, setting aside funds for a rainy day helps minimize the stress of any unexpected expenses.
  6. Learn to invest. Investing can increase income, making it easier to grow savings and emergency funds. But it also comes with risks. Seeking the advice of a trusted financial advisor can help smartly diversify investments among numerous portfolios.
  7. Pay off debt. Repaying debt — thereby eliminating interest payments — is one of the best ways to save money. Paying off debt also benefits your credit score, an important factor when approaching investors or banks for funding.
  8. Save for a safety net. A safety net differs from an emergency fund. The emergency fund is there for immediate, unanticipated use, while the safety net provides ongoing stability and a break or reward when you need it. Think of the safety net as the sum you’ll draw from for a vacation or a significant personal purchase.

Money may be a major stressor for many, but keeping an eye on yearly finances and following these tips will help you control your finances and reduce stress.

How to save for retirement as a freelancer 🌄

Retirement?! But that's years away — there’s plenty of time to save up, right?


Freelancers, by and large, have different career stability than salaried employees, so saving for the distant future requires a different approach. A few simple tips can make it less intimidating.

  • Save 10% monthly. Regardless of total income, set aside 10% every month toward retirement. Every little bit helps.
  • Start a retirement plan now. Look into retirement plans, such as a SEP-IRA, a Health Savings Account (HSA), or a 401(k). Be sure to understand contribution limits and interest rates for each specialized plan.
  • Taxable brokerage accounts. This investment strategy involves taxable accounts, meaning taxes must be paid on capital gains. The draw of such accounts is that there are no limits on how much one can deposit or withdraw, unlike other retirement plans.

Even from a younger age, investing in a 401(k) or other retirement plans is a wise choice for Independents. The earlier you start, the more you’ll have saved up, making those later years far less worrisome.

Explore opportunities 🪙

With planning and dedication, any freelancer can figure out how to manage finances, reducing stress levels and leaving more time and money for relaxation. Contra offers valuable services to assist in financial planning, including the Contra Wallet and the Contra Crypto Payout system. Our commission-free platform also ensures Independents receive all the money they deserve. With our help, managing money is easier than ever.

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