Expenses You Can’t Afford to Cut

In a freelancer’s life, when the going gets tough, the amenities get going. We all start looking for things to cut out of our budgets during those “famine” months when income isn’t so great. As you’re calling companies giving them the “I’d like to cancel my account” spiel, make sure you don’t cancel these.

Homeowners or Renter’s Insurance

Your mortgage company requires you to have homeowners insurance. Even if you own your home, you still need insurance to cover the things inside your home in case of disaster or theft. Plus, you don’t want the burden of repairing or replacing your actual house if there’s a hurricane or fire.

Renters: don’t assume your landlord’s insurance covers the things inside your home; it usually only covers the building. You’ll need your own insurance to pay for damages to your personal property. Some insurance policies even cover items stolen from your vehicle (your auto policy might not).  And it might be worth it to pay a few extra dollars each month to cover your computer, in case of loss, theft, or damage (e.g. spilled coffee).

High-Speed Internet

Unless you live next door to a library with free Wi-Fi, you need to have high speed internet of your own. Don’t try to rely on a neighbor’s internet. You never know when they’ll cancel service or put a lock on their account. The upside is that internet is a tax-deductible business expense, at least the percentage of internet you use for your business. While it’s probably not a good idea to cancel your high-speed internet, you can downgrade your speed or check out promotional offers with other companies. I don’t suggest you go back to dial-up just to save $30 a month.

Web Hosting for Your Online Portfolio

You can get hosting for as little as $5 a month and maybe even free. So if you feel like you’re spending too much on hosting, it's time to shop around. Check your webhost’s current pricing. If their current promotional offer is cheaper than what you’re paying, call and ask for a discount. If you switch hosts or move to a cheaper plan, make sure you continue to get a package that meets your needs. Read reviews or ask for recommendations before you switch to be sure you’re going with a reputable company.

Computer Repairs

If your primary work computer needs repair, get it fixed. After all, you need it to get your work done. Always weigh the cost of repairing your current computer versus getting a new one.

Income Taxes

It’s so easy to avoid paying the IRS because they’re going to stop doing anything (at least not anything that directly affects you right now) because you missed a payment. If you delay quarterly tax payments, you could get hit with an underpayment penalty. What’s bad about delaying your quarterly taxes is that it’s harder to catch up once you’re behind. It’s much easier to pay $1,000 every few months, than it is to pay $4,000 by April 15.

Always Weigh Your Options

Some expenses you can easily get rid of, or at least go without for a few months. Things like magazine subscriptions, books, and travel can probably be reduced or eliminated. As you evaluate your current expenses, think of ways to do things cheaper or even get them for free. But if an expense is critical to your writing business, keep it. And don’t forget that it’s always within your power to generate more income either by raising rates, adding an additional revenue stream, or taking on more work.