Ctrl your budget as a freelancer

How to Take Control of Your Budget as a Freelancer?

Have you ever considered how much you actually do to control your budget as a freelancer? Here’s a very real and very possible scenario every freelancer can at one point or another end up with. An important, or possibly only, client could end a project at any point and end their relationship with you. If you are not careful, this can leave you without a stable income for a week, month or even more, depending on when you can find the next client. Even then, you’ll have to wait for payment from then for a while.

Being a freelancer has its perks, for sure, but not all about it is roses and sunshine. Freelancers must always be prepared for extreme situations like a client suddenly leaving, dry periods without income and the like. The profession is, to be sure, more and more desired and valued, especially among Millennials, as a way to ensure a better work-life balance. After all, if that wasn’t the case, 34% of American workforce wouldn’t choose to freelance in 2016. But nevertheless, many shy away from freelancing for being too risky, not wanting to leave their traditional jobs.

But as long as you control your finances, there is nothing to fear. Let’s see how you can control your budget as a freelancer.

Determine Your Monthly Expenses and Income

What are you spending money on

One of the biggest misconceptions about being a freelancer is that you don’t have any expenses. Of course this is not true. The only real difference between freelancing and a full-time job is that you don’t have to spend money on gas to get from your home to work and back. And you probably don’t need to spend so much on office supplies and in the office cafeteria. But all the other expenses are still there.

Here’s what I want you to do. Take a pen and a paper and start recording your expenses for the month. This will give you a good idea of how much you spend each month and allow you to be a little smarter with your budget as a freelancer. Or, if you can’t find a working pen, try a spending tracker like BudgetTracker.

Your monthly expenses would include rent and mortgage, credit card loans, taxes (don’t forget to pay these), food, electrical and water bills, transportation, gas (just because you don’t drive to work doesn’t mean you won’t use a car at all), but also any monthly subscriptions to magazines and websites and more.

Now take your average monthly income over the past 12 months and compared that to your expenses. How does it fare? Are you earning more than you’re spending and by how much? Does your income allow you to spend money on more than just essentials like food, utilities, rent, mortgage and taxes? Do you also have enough for yourself and for any “special expenses”?

Now it’s time to prioritize your expenses and create a “worst case scenario” budget. Basically, this budget will include only what’s really essential and, as the name suggests, is something you can turn to in case you’re without clients and projects for some time.

Set Up a Rainy Day Fund

Leave some money aside

As a full-time employee, your paycheck will arrive at the end of each month, so you’re pretty much set. But if you’re freelancing, like we already established, you don’t have as much security. Don’t let get caught off guard by a dry month and a period without clients and projects (and consequently without payments).

Set up a rainy day fund. This can be a few bucks you’d put into a separate bank account after each client payment, separate from your main account, or you can put the money in the envelope and keep it away from your eyesight, or even, if you have a family member or a friend you can trust with your money, let them handle this account for you. In fact, this last method might work the best as you don’t have to pay the friend (buy them a drink at least) and there isn’t as much temptation to open the envelope yourself.

Now that you’ve set up a rainy day fund, you can have a safety net you can turn to in case of an emergency. By emergency, of course, I don’t mean spending that money on parties, but paying for essentials during a dry or a particularly slow month.

Get More Avenues of Income

A great thing about being a freelancer is that you don’t have to be tied to just one client. In fact, you shouldn’t be. Don’t get into the mindset of a full-time worker and work with just one guy. Get more projects. The more, the merrier.

More clients and more projects means more money in your account, but also more financial security in case one of the clients decides to cancel their project, is late with payment or doesn’t pay you at all. For example, you can have one or two bigger clients where the majority of your income comes and 3-4 more smaller clients to fill in any gaps in your budget.

Also, my recommendation is to never let yourself relax completely. Even if you have a full table of clients, keep looking for new, better paying ones. Remember, clients are not the only ones that can end a contract and leave, just don’t make it a habit of doing this too often and too quickly. The longer the project lasts, the more money you can end up making and your relationship with that client can be better.


Keeping an eye on your budget as a freelancer is extremely important as you can see. Just because you don’t need to commute to your place of work, doesn’t mean you don’t have any expenses. We already established that you have to pay your mortgage, bills, food and more. Unfortunately, for many new freelancers, budget control doesn’t come as easily due to the fact they now have more than one income stream. Hopefully, this post will help you keep a tighter grip on your budget as a freelancer.

What other ways to control your budget as a freelancer do you recommend? Let me know in the comments below and feel free to share this post on social media.

Vladimir Covic
  • Pauline
    Posted at 01:08h, 16 June Reply

    I am so not good with how to smartly control my budget. This post comes in very handy!!!

  • Eliza
    Posted at 18:04h, 14 June Reply

    This article is so great, thanks for sharing it. I’m a freelancer too, so come of these tips might be rather useful.
    Cheers, Eliza | http://www.fashion-confession.com

  • Nicole
    Posted at 13:48h, 14 June Reply

    I must be so hard to budget when working as a freelancer. A rainy day fund is super essential!

  • Mangesh
    Posted at 19:09h, 13 June Reply

    I use think freelancing is not my cup of tea. But your tips really made me think it otherwise. Kudos to you 🙂

  • Shubha Juyal
    Posted at 19:07h, 13 June Reply

    OMG!..I am the worst at budgeting…such needed post for me!

  • Nusrath Sariffo'deen
    Posted at 18:09h, 13 June Reply

    I bookmarked this! Very handy article. Thanks a lot for this!

  • Sarah
    Posted at 15:24h, 13 June Reply

    Thanks for sharing, I’ve considered going freelance but haven’t had the courage to just yet! I think the rainy day fund is particularly important.

  • Echoesofhervoice
    Posted at 14:54h, 13 June Reply

    Nice tips. I’m not sure that I would choose to be a freelancer considering the unsteadiness of the income. But kudos to those who are managing.

  • Anshuman Agrahari
    Posted at 10:58h, 13 June Reply

    I appreciate this article, Have written one or two articles on the same topic.
    You could add reference to some money management apps, that’ll be helpful to the readers.
    Sharing 🙂

  • Arūnas
    Posted at 10:30h, 13 June Reply

    Useful article. “Set up a rainy day fund” is one of the smartest things you can do with your money.

  • Michelle
    Posted at 02:04h, 13 June Reply

    Great article. It’s so hard to budget when your income isn’t steady

  • Salim Šabić
    Posted at 00:20h, 13 June Reply

    Great advice. As a freelancer, you always need to have some cash aside for “rainy days”. 🙂

  • Chloe
    Posted at 20:21h, 12 June Reply

    Hi, planning in your budget is key and essential and having saved away got an emergency is key.

  • Janecke engeberg
    Posted at 18:49h, 12 June Reply

    Thanks for sharing! Great tips. I am not freelancing, but have reduced my workload to get some more time for my writing! A lot of good tips for me here! Thanks

  • vinod verma
    Posted at 15:55h, 12 June Reply

    Great point and valuable tip.

  • Divyanka
    Posted at 15:47h, 12 June Reply

    Very relevant and helpful points. Agreed to the problems people face as a freelancer, thanks for providing solutions!

  • Dave
    Posted at 15:32h, 12 June Reply

    The rainy day fund is what saved me and my brother last year, and is about to save us again – summer is hell for freelancers in Italy, as most of the local jobs dry up for almost eight weeks, from mid July to mid September.
    Thank you for this post.

  • Abhinav
    Posted at 15:18h, 12 June Reply

    Valid and relevant. Over the world, many people are considering freelancing but knowing the budget and work with it is absolute. Countering for high expenses or unexpected expenses is a great point made.

    Posted at 10:35h, 12 June Reply

    I am a freelancer and the article helped! enjoyed reading! thanks for sharing

  • Zineb
    Posted at 10:32h, 12 June Reply

    I’m not freelancing but I really think you made some valid points in this post.

    Love always,


  • jhilmil
    Posted at 10:21h, 12 June Reply

    The more projects, the merrier & more creative we become:). Really wonderful post!

  • Ashutosh Verma
    Posted at 08:06h, 12 June Reply

    Aahhaa.. now I have something that is useful to me. This is very great idea for control on my budget. Thank you

  • Anne Murphy
    Posted at 22:03h, 09 June Reply

    You definitely have to put money aside.

    All right, when I freelanced my work was highly seasonal. I worked with retail, so every year Q4 was incredibly busy, Q1 was dead (but some of the money was coming in from the previous quarter) and the trick was to have a great enough variety of clients that some would have significant work in Q2-3… and then start over again. It was always a roller coaster! Most isn’t quite that dramatic… but I”m certainly not the only one to have a program cancelled with less than a week notice. Or a client go bankrupt…

    I did it to give me flexibility for other work I was doing – and that filled some of the holes, for me. We all need to see what makes sense for us.

    • Vladimir
      Posted at 06:59h, 12 June Reply

      Very true Anne. You always need to have a backup. Thanks for the comment.

  • Raushan Kumar
    Posted at 17:02h, 09 June Reply

    I definitely agree with your point , freelancers have the biggest problem to manage the budget. You have surely suggested nice process to recover .good work.

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