How NOT to manage your money as a freelancer

As copywriters, we’ve spent a lot of our professional careers freelancing. Long enough to completely change our attitudes towards how we manage money: from the care-free, penalty-heavy, actually very stressful madness of youth, to the careful, penalty-free, surprisingly calm control of middle age. 

Here are five pieces of terrible advice on how to manage your money that we once followed—answered by our older, mature selves.

Go for the bank with the best ad campaign

Why bother with all the research? I just see which ad campaign makes me laugh, and choose them. Ooh, or maybe the one with the cool logo.

Not clever. It’s worth taking the time to find the one that’s just right for you. Some banks are free to sign up and free to manage, with fee-free transfers, mobile deposits and business tools. Some are more ethical than others; some are entirely online… Do your research.

Chuck your business and personal funds into the same bank account

It’s so much easier! Well, for about five seconds. Okay, true, it’ll make things trickier in the long run, but who cares? 

The taxman cares. And so will you, once you’ve experienced the pain of trying to distinguish between the two when you do your tax return. Keep them very separate—possibly even with separate banks. Don’t mix business with pleasure, remember?

Budget shmudget – you can manage your money without it

Budgets are boring. They’re restrictive. And they’re useless. I earn what I earn, I spend what I spend (and maybe a bit more). What difference does a budget make?

Budgets can make the difference between profit and loss. At the start of each month, write down a conservative estimate for what you will earn and for what your expenses will cost—and don’t forget to factor in tax. Then spend accordingly: tighten when you need to, spend when you’re free to—but let your budget help you decide when that is. Check out everydollar.com or other budgeting tools online.

Only invoice when you feel like it

I only invoice when I’m in the mood. Which is almost never. But every few months I’m like ‘Ooh, yeah, let’s do some invoicing’. But by the time I’ve found all the invoice details I’m bored already and watching dancing parrot videos.

Want to spend less time invoicing? Do it more often. Keep track of all your projects as you do them, then invoice them by the end of the same month you did them in. It’s also good practice to keep a short, strict deadline: payment within 15 days, or else there are penalties (make this clear on the invoice). You’ll be surprised how much less chasing you’ll do.

Spend all your tax money 

OK, I know I SHOULDN’T do this but I just can’t help it. It’s there, and I need it. I’ll find the tax money later.

It isn’t there if you move it straight away. Tax money is money that you owe, and as soon as you spend it you’re in debt. Instead, open a savings account with the same bank—specifically for taxes—and instantly put aside the appropriate percentage (plus a little bit more) so you can’t touch it. So much less stress when the year ends.