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Smart Financing for Self-Employed Professionals

In the vast business world, about a third of specialists consider self-employment a better choice than standard office work. As a rule, the professionals set up the salary schedule themselves — this is why it is imperative to use the best tips for smart financing!

Budget Planning

First, you need to calculate how much money you need to cover the minimum needs (rent, food, entertainment, etc.). For this, all the typical expenses, which are repeated monthly, should be identified. Secondly, it is worth analyzing the income source to understand how much money you will have this month.

Of course, you can do this manually, but it is much more convenient to use various automated services for calculating income and waste:

  • Money Lover;
  • Goodbudget;
  • Monefy;
  • Splittable;
  • CoinKeeper.

This kind of carefulness is needed to avoid embarrassing situations with a lack of money. For example, if the monthly expenses are $750, this amount is considered the minimum necessary earnings. But even if you could not get the appropriate salary, they can always take a loan from Payday Depot.

Accumulation of Funds

The second important tip regarding smart financing for self-employed professionals is to accumulate funds regularly. Four main rules:

  1. Decide what you are ready to skimp on and what you are not. Make a list of mandatory expenses and reduce incidental costs to a minimum.
  1. You can safely save 10-15% of your income. To save money quickly, you need to keep it 2-3 times more (in fact, you can save up to 30% of the salary). 
  1. If postponing 20% of the salary seems impossible, then the earnings are considered insufficient, and a search for additional employment is required.
  1. Don't waste money that you save for a large purchase or store for a rainy day. It is best to put the funds in a bank on a deposit that cannot be withdrawn until the final accumulation without losing interest.

The habit of saving the salary part will allow having a “stash” in case of a sudden need.

Tax Payments Control

The global problem of self-employment is that the worker should independently control how much taxes must be paid and when the deadline comes to an end. However, special services also exist to simplify such operations. For example, QuickBooks allows you to track the financial situation clearly and on time. Other software: TurboTax.

Explore Ways To Save on Your Business Insurance

Self-employed professionals have reported unnecessary costs on their commercial insurance. While each business has unique risk exposure, your commercial insurance should also reflect that. It is advisable to disclose all preventive measures implemented inside your premise to earn discounts on insurance premium. Examples are installed burglar alarms, high security monitoring within your block, fire alarms installed, and security cameras. If you have more than 5 years experience in the services that you specialize in, most insurance providers allow for discounts on Business Liability Insurance. The same is true with protective alarms installed in a car used for work and business-related activities, you may earn at least 5% discount of your Commercial Auto Insurance.

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