Having no income is bad. Not caring for your regular income is worse. But recklessly spending and not even projecting a spending plan for your irregular income? It?s the worst.
Being a freelancer is one of the most fulfilling professions a Filipino can have. You are your own boss, you set your own time, and you get to decide whether to give yourself a raise or not.
And let?s face it: Filipinos have inherent family-centered values, so being able to work from home with our loved ones brings home the cake.
But, being a freelancer also means more responsibility; after all, you?re running your own company. You deal with insurance, invoicing, saving for retirement, and paying taxes. You?re plagued by throbbing headaches and swollen eyes. You may even have difficulty sleeping at night because of your irregular income.
Protect yourself and your freelancing profession by following these personal finance tips:
1. Prioritize Basic Budgeting
You can never be at a healthy personal finance state if you don?t even have a customized spending plan.
Start with basic budgeting?list down your basic needs (like utilities, internet, food allowance, transportation, office supplies, projected tax due, health insurance and retirement savings). Estimate a figure for each category.
Basic budgeting means focusing on the essentials so that you have a solid idea on where to focus your funds on, if ever things get a bit slow. We can always eat out at restaurants or watch a quality movie some other time, right?
2. Build an Emergency Fund
You might be a full-time employee doing part-time freelance work or you might be a full-time freelancer right now. It doesn?t really matter.
If you don?t have three to six months? worth of funds that can sustain your basic budgeting, you should start saving now. This helps you sleep better at night and keeps you from asking for money from relatives, in case things get tough.
3. Shop Around for Adequate Health Insurance
Health insurance is something that everyone can get now, even if they?re not part of the corporate world.
Do yourself and your wallet a favor by getting one for yourself. Yes, you might consider it as a waste of good money when you?re paying for it monthly, but once your medical bills are covered by your health insurance coverage, you?re going to thank God you decided to get one.
4. Set Aside Monthly Retirement Savings
Freelancers are patient, wise, determined and good-looking (yes, you read that right) people, so they deserve to retire comfortably. Yes, you might only be in your twenties right now and retirement may seem eons away, but it?s never too early to save for retirement!
Shop around for great investment vehicles: treasury bonds, mutual funds or the stock market can give you great options. Just remember to not let your retirement savings sleep in your bank account. Inflation will just eat it all up!
5. Don?t Get Trapped in Lifestyle Inflation
Lifestyle inflation is when you overspend on a necessity and convert it into a luxury.
Don?t get me wrong, luxury is good when it is in rare occasions. After all, we can only savor it if we don?t get much of it, right?
However, when you regularly eat out at restaurants, buy unnecessary clothes or watch movies each time, there might be a problem here. Say ?no? to lifestyle inflation. It will just make you feel bad when the feast is over and when famine comes in again. It won?t do us any good.
Lianne is a 21-year old registered nurse from Global City Innovative College. She is a professional writer, personal finance enthusiast, life blogger & frustrated entrepreneur. Lianne is a lover of life, tea, laughter, anime, travel, productivity, & love itself. Visit her at http://thewiseliving.blogspot.com for more of her works.Photo credits: Images of Money
Source: http://thefreelancepinoy.com/freelancing-tips/financial-tips
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