If you work as a freelancer but you don’t run a company, it might be rather difficult to differentiate between your personal and business expenses. It’s not easy to resist a temptation to buy yourself, for example, a new Apple gadget if you can justify it with professional reasons, right?
Managing payments, bills, unplanned expenses or spontaneous shopping is quite a challenge not only to freelancers.
If you work remotely, however, you must take into account the irregularity of your income and think how you will settle up with your customer.
Why is it worthwhile to analyze and control your expenses? Freelancers complain about practices of lowering rates or customers’ unrealistic financial expectations.
Regardless of whether you are happy with your rates or consider your earnings to be too low, a meticulous analysis of expenses will allow you to eliminate unnecessary shopping and to regain control of your budget.
It might turn out that “single” cups of coffee in a popular network of cafés eat up more of your earnings than you think and far more than you are willing to spend.
5 best tools for financial management for freelancers
How to take control of unplanned shopping? We have prepared a list of 5 best free tools and applications for budget management for freelancers. You will find here a wide range of services: from archiving bills through calculating rates and ending with issuing invoices.
Setting an hourly rate – Toggl
Toggl is a well-known tool for tracking working time that is particularly useful when you settle your work not on the basis of an entire project but applying an hourly rate. A great advantage of Toggl is that you can use it on mobile devices, as a desktop application or a Chrome plugin.
Toggl is free of charge up to 5 users so if you want to settle an “hourly” job with one customer, you can both track the progress of work and not to pay for the service.
Paid plans start at $10 per month.
Issuing invoices – useme.eu
Useme is a website for freelancers where sign a freelancer contract and issue an invoice for your customer from any place in the world. Apart from that, the service also offers a job market for freelancers where, unlike on other websites, an employer can see rates in the submitted offers.
Registration in the service and using it are free of charge. Useme charges a small commission on the settled deals.
Planning a budget and expenses, saving
Even if you don’t complain about your financial situation, comparing your list of expenses with reality can show you a few “sins” that eat up a lot of money. Thanks to a few such small sources of savings you can recover amounts that will be surprising for you.
A convenient solution is applications for managing expenses and cost tracking. In the Mint app you can add several bank accounts and with the help of monitoring, you can learn about what you spend your earnings on.
You can divide your expenses into a few categories, which allows you to set average sums spent on living. It is a particularly important piece of information for those freelancers who have just started working on their own and would like to avoid unpleasant surprises.
External apps, however, demand access to your data, so if security means a lot to you, you can make use of dedicated banking apps, which enable you to track expenses and show an account’s “statistics”.
They also enable you to obtain more detailed reports since the application is connected to your account and isn’t dependent on what you enter into it… and what you overlook.
If you possess a few accounts and want to combine data obtained from several applications, use the Calculator created by Novi https://www.novimoney.com/blog/ blog. Along with offering you a spreadsheet for budgeting, Novi will give you some advice and suggest a few ideas about how to “disenchant” budgeting for those who are put off by it.
Archiving bills: PomoDone
Are you fed up with working too much? Or maybe it’s just difficult for you to get down to work and you feel that you’re wasting time just looking at the screen? PomoDone will solve both these problems. The app uses the Pomodoro Technique in its operation: it breaks down the allocated time into smaller intervals of time consisting of the “spins” of work and the “tomatoes” of rest. The classic Pomodoro Technique includes intervals made up of 20-minute work and 5-minute breaks; however, if you don’t want to work more than, for instance, 4 hours on one project, the app will also work well.
You can easily synchronize PomoDone with Useme and issue an invoice for your hours of work.
5 best tools for finance management for freelancers – summary
What does a freelancer need to control their budget?
First of all, you should keep your finances related to remote work in order: accurate adding up your hours of work is needed here (Toggl) and concluding deals with customers via the Internet (useme.eu).
The second category of expenses concerns the cost of living. You can control your expenses, search for sources of savings and put away money by means of mobile device apps (Mint), dedicated banking apps or by calculating costs manually and putting them in a form.
Finally, you can use PomoDone to keep control of the pace and time of work.