Money and the Freelance Life (or Why I Drive a Really Old Car)

I don't talk about finances much here other than issues revolving around rates and making money. That's an area where I know my stuff, but I leave the rest to our resident financial experts. Today though I want to talk about money -- my money -- with a personal look at how freelance success has, and hasn't, changed how I spend.

Some Background

One thing that always leaves me shaking my head is when new writers tell me I can't possibly know what it feels like to be in their shoes, desperately seeking that next check to pay their bills. Yeah. I wish. When I made the leap from full-time nonprofit work to starting my own business full-time, it was a struggle. I remember what it was like wondering where my next rent payment would come from. It's not a pretty place to be. And with a combination of luck and smart business decisions, I was able to get out of that phase fairly quickly. (Tip: it doesn't come from working for peanuts.)

I quickly realized my worth and built the confidence to charge for it. I wasn't afraid to adjust my target market a bit. I took risks that paid off. I learned new skills (why I can sit down and put out a new site in a few hours these days). I learned to diversify. I built my network. I built my platform. And most importantly, I learned how to say "no."

It didn't take long for my income to grow -- dramatically. Now I really don't have to worry about money. But for me that kind of success didn't change all that much about how I spent.

Earning, Spending, Saving

I know some freelance writers who earned a big payout and immediately blew it on something like a trip or a new car. Then they wonder why their overall situation hasn't improved. Now don't get me wrong. If you genuinely need a new car, by all means, buy one. But buying one just to have something shiny and new is silly to me, and it's not something I'd do. Even after years of watching my income steadily increase, I'm still not the type who's going to assume that trend will continue indefinitely. That's why I drive a 17 year old little Geo Prizm (who runs beautifully other than needing routine maintenance, although her paint job needs far more than a touch up). My sister and I call her "the happy little Geo." I love that car. I don't drive all that often -- a perk of working at home -- and the woman I bought her from didn't drive her all that often either (bought the car from someone the family knew so there wouldn't be surprises). She only has about 130k miles, and these cars have been known to hit 300k. I'll be thrilled if I can keep her running to 200k. I think when the day comes where I do have to get rid of the car, I'll probably cry. Really.

The fact that I won't spend just to spend when it comes to cars doesn't mean I don't spend more now that I make more. I just don't let it change my general habits so much that anything becomes an extreme. For example, my apartment looks much different now than it did a few years ago. I upgrade things as they need to be replaced... not just because I want something shiny and new. I don't buy the latest tech gadgets just to have them. If I overspend at all, it's probably buying things for other people, or putting more money into the business (which I really don't think is "overspending").

Some other people I know have let money change them pretty significantly. One of the biggest changes is that earning more makes them think they should buy more on credit. I'll never understand that. But I think I'm fairly well-grounded on that front these days. I don't buy on credit. Ever. I used to. And when I was younger I got into trouble with it after a house fire -- long story short, a student can't juggle three jobs for long to maintain those credit card payments before burnout sets in. It was a wreck. And I vowed never to buy on credit again. I don't use credit cards. I have two old debts left -- student loans (which I opt to pay off over time because it's the oldest account on my credit report, and the age helps my score -- which I still find obnoxiously odd), and one other old debt that will be paid off completely as soon as they mail me the documents I keep requesting (which they assure me I'll have in 60-90 days -- I hope).

Helping my score or not, I have no intention of financing things in the future. When the Happy Little Geo does finally bite the dust, I'll buy my next car outright -- no car loans. And while I'm content in my little one bedroom apartment for now (I don't believe in buying a house until I'm married and ready to settle down long-term), I'm hoping to buy my first house outright too (although I understand there will be another person involved in that decision).

Why am I talking about budgeting and spending and saving with you? Because I want new writers to understand that those of us who have gone before them do understand where they're coming from, do understand the tough decisions involved in starting a freelance career, and aren't necessarily loaded financial whizzes just because they earn more now. I can buy what I want and I can afford to sink a good deal back into my business. But that comes down to a combination of hard work and self-respect and it doesn't put me, or anyone else, out of touch with newer freelancers. And those are things you can achieve too if you learn to value yourself early on. Remember it's never too late to make changes, and it doesn't have to take as long as you think to see serious financial results.

Profile image for Jennifer Mattern

Jennifer Mattern is a professional blogger, freelance business writer, consultant, and indie author. She runs numerous websites & blogs including All Freelance Writing, Freelance Writing Pros, NakedPR, and Kiss My Biz.

Jenn has 25 years' experience as a professional writer and editor and over 20 years' experience in marketing and PR (working heavily in digital PR, online marketing, social media, SEO, new media, and thought leadership publication). She also has 19 years' professional blogging and web publishing experience (including web development) and around 18 years of experience as an indie author / publisher.

Jenn also writes fiction under multiple pen names and is an Active member of the Horror Writers Association.

Subscribe to the All Freelance Writing newsletter to get freelance writing updates from Jenn in your inbox.

16 thoughts on “Money and the Freelance Life (or Why I Drive a Really Old Car)”

  1. Well done on growing your business Jenn!

    It’s true, success in business comes from hard work first, smart (but sometimes also risky decisions) second and a bit of luck. But what’s often overlooked is how you manage what you earn. And if you don’ do that last part right, no matter how hard you work, decisions you make and the amount of luck you have, you may go down anyway. So well done on writing this post. Good stuff.

    • Thanks Pawel. Managing the money is definitely another aspect of earnings, and frankly it’s not my best area. It’s a struggle for me to stay within budgets and actually bother to track where money is going (personal spending at least — better business records). But here’s the thing — if you don’t get better about that you never know when the money’s going to be gone, and when the work will dry up. Years of double-digit growth is awesome. But I’m not naive enough to assume it will always be that way. And others shouldn’t be either — whether it’s growth with private clients or being naive enough to think a content mill or residual income stream will always be around. You have to prepare for possible changes.

  2. Jenn! I’m so impressed! I’ve talked specifically about money before in one of my posts. All combined, I make right around 6-figures a year. If I were single I’d have a rather significant surplus I could work with to invest and save, but as it is, I don’t see much of that money at all. Why? Because I pay about $900 a month in childcare. I pay a rather sizeable mortgage on a house big enough for a family of four plus the necessary utilities. Could that have been avoided? Sure, but then it costs quite a bit to get positioned for the best schools – I wasn’t willing to settle on something less for my children’s education. As it is, my house is one of the least expensive in the area.

    We have two car payments because one of us can’t keep an old car and we were faced with a carseat problem – they wouldn’t fit in the car with us thanks to our height. Of course my biggest expense is the one that you mentioned toward the end of your post – the one that’s supposed to be sharing expenses and decisions. What I’ve learned after 9 years of marriage is that sometimes that special someone shares more debt with you than profit. His business has had some serious ups and downs and a failed PPC venture (overseas company stiffed him a payment of $xx,xxxx left us with impressive debt for that and then more as he worked quickly to rebuild his business without ever really grasping the more intricate finances.

    We got a bit more debt when his business started to suffer around the time I left teaching for a year to stay home. Today his business has all but failed and there’s not a thing I can do about it. So rather than saving and enjoying the fruits of my (considerable) labor, I get the bills paid. My business continues to grow, and he’s found a job outside of computers to help pay some of the bills again, but I’ll still be paying the lionshare of everything.

    This rant has nothing to do with your personal situation. I’m just showing the other side of the coin to tell you that I’m envious of your financial position not because I’m not there yet, but because I could be there, too. 🙂

    • No need to be envious. Yeah, the business debt issues suck, but overall I could equally say I’m envious of you — having the house and the hubby and the kids already. Different strokes for different folks and all that.

      As for the debt, it’s not as if I don’t have any financial issues now. I do. I really screwed up my business taxes early on, lost a lot of the documents that have been very hard to replace (okay… actually an ex took them after a split), and by the time I get that mess all sorted I’m probably going to owe a small fortune in taxes. I remember talking to Yo about the tax issues before, and how I’m always slow to file. She was kind of freaked out and panicky as the deadline approached, but I’m much more relaxed about it. I’ll do it right. I’ll verify stuff. And then I’ll pay whatever penalties and interest they say I owe. I don’t mind paying a bit more if it means avoiding the same mistakes I made before. (And after the horror stories of some colleagues — actually also including Yo I believe lol — I still prefer to do that on my own than bring in a 3rd party.) Might be crazy to some, but it’s one of my quirks, and that’s my biggest financial issue (and yes, one that I’m getting better about over time). So debts, low earnings, whatever… we all have our own things we deal with and there’s always room to improve. For me it’s that and wanting to budget so I can set aside more for my long-term goals. For you or anyone else, it might be something different. I just don’t want anyone feeling like earning a good income means you have everything in that area of your life figured out and you’ve lost touch completely with real life financial issues people face. Just not true. For those who do have every little thing figured out, I’m jealous.

      I have to admit the new budgeting thing is actually kind of fun for me. I like challenges. It’s kind of like playing a strategy game with your life, optimizing what you bring in and getting the most out of it. (Yeah, I’m kind of a dork like that.)

      • LOL – I totally get it about the budgeting! I’m a master budget maker. I’d be out at the store price comparison shopping to get the best deal on a slice of bread to fit in my handy budget and then come home to a $300 new computer toy that the other half just HAD TO HAVE. There are definitely money issues for everyone. We actually just closed out the S-corp because the taxes on that were insane. I think I finally have them all straightened out and I went ahead and closed that down (cleanly, I think.) I’ll open another LLC or S-corp in the near future just for me – it cuts down on my work trying to train a man to keep records who simply doesn’t get it. 🙂

        I totally respect you doing taxes. Every year the man who paid someone to do a 1040EZ back in the Army would ask me why I didn’t just hire someone to do them if they were so frustrating. My answer was always that I’d have to do just as much work preparing the documents and checking all of the numbers to get them ready for someone else. After all of that, I might as well just fill out the damn forms myself, too.

        • You know, the odd thing for me is that in school I was actually an accounting whiz. It came easily to me, and (another dork moment coming) I really enjoyed it! I think the biggest issue earlier on was keeping records straight and paying attention to a few of the tax rules (a bit more complicated than just general accounting).

          Your situation sounds amusing in story form, but I bet that gets frustrating! Do you find that it causes a lot of tension or that the opposites on some of the financial issues tend to balance each other out more?

          • It is amusing most of the time to be married to someone who just doesn’t get it. He struggled with the concept of net and gross for YEARS. I’d be like, honey – you make $45k. He’d be like, no I make $90k – see? I’d make complex spreadsheets, graphs and all kinds of things to explain it, but he just didn’t get it. You can imagine what that does to the family budget. LOL

            I’m glad to say that now he finally has clued in and even though he works crazy hours, he also has a job that he’ll do well in. He’s selling Fords. Of course he came home with a new Mustang GT that he loves, but that’s his car payment now that he can pay for and it was a pretty outstanding deal for the car with the employee discount. He has a lot of potential in the car business and I’m looking forward to the extra income. 🙂

            Overall, the differences cause tension until you find a way to deal with them. For years I kept trying to make him see the world my way (which was obviously the correct way.) Now I give him as many of HIS bills (on his credit) that he can afford on his paycheck and he’s handling them. If he messes up, it’s his universe not mine. That makes it much, much easier – especially since getting more responsibility has opened his eyes in a big way to how it all works.

            Most of this is not entirely his fault, btw. He was raised by a mother who didn’t have any financial sense unfortunately and then went to the ARMY where your paycheck is all spending money since the Army takes care of all of your housing, most of your clothes and your food. When he came to me, he was pretty clueless. It only took 10 years to bring him up to speed. Good thing he’s so good looking. *wink*

      • Oh yeah, and having the suburban lifestyle now is actually kind of awesome so long as you don’t mind piles of debt and plenty of stress. In about 3 years the debt will be all gone, the childcare expenses will be gone(the boys can walk the 5 blocks home from the local neighborhood school and wait 20 minutes for me to get home) and all of that money will be mine to play with and invest. Or spend on braces and sporting leagues (those suckers are expensive!). Whatever.

        When my youngest heads off to college I’ll be 45. The college fund is growing every year primarily thanks to my parents so I’m hoping I don’t have a major outlay for that. So at 45 I should be rolling in cash and bored out of my mind – time to go back for the doctorate, travel and all of the other fun things I’ve put off thanks to the kiddos.

        There are benefits of doing it both ways. I struggled early on by having mine at 25 and 27. My sister waited until she was 32 and isn’t struggling with money, but struggles with time to be home. She’ll be in her 50s when my niece heads off to college, about the time she’d like to retire. Of course she spent the last 10 years traveling and working ridiculous hours for a ridiculous salary in a crazy engineering job that took her all over the world. (She loves it.)

        I’ll have ten years at least of teaching left before I chose to retire (from teaching) after I send the kids off. That’s plenty of money and summer vacations to tour the world. So it definitely works either way. And people like Yo who aren’t interested in kids will simply have tons of money to lavish on cats and whatever other delicacies she so desires. 😀 Okay – off comments, back to installing a new kitchen sink in my big fixer-upper I pay an arm and leg for in the best school district.

  3. I love your little car, too! She runs like a dream.

    I agree, Jenn. I wouldn’t have bought a new car last year if my daughter hadn’t needed a reliable car for college. I sold her mine (and I still miss it), and bought a used one. It nearly killed me to part with the money – things were going great, I had a nice bank account…. all gone into payments now. I can’t wait to pay it off. It’ll be with me for a long time, I hope.

    • Yeah, she runs pretty good for her age and all (and yes, while not grammatically correct, I will always refer to my car as a “her” lol). The woman before me took great care of her. I try to, although not the best to be honest. I don’t take her into the city often, so you and Devon were a special treat. And while I don’t really have any problems with her, I do often worry that other people will get freaked out in the car because you can feel the road much more than in plenty of newer models (which I love and consider a part of the experience of driving!).

      I know people who “need” to change cars every 3-5 years, and that I just consider absurd and wasteful and in the cases of the folks I know personally who do it I also consider it kind of shallow. It’s definitely an image thing. I can’t imagine anyone caring that much about what other people think. *shrugs* Makes me smile though when they bitch they can’t go out b/c they have no spending money. And all I can think is “yeah, that’s because you’ll forever be paying a small fortune each month for car payments.” idk Just beyond my comprehension I guess. I’d rather have one that works and run it till it dies, then replace it. And use that time to save for the new car (no financing and interest) and have more money to enjoy life. But that’s just me I guess.

  4. I’m pretty cautious myself and living the freelance life has made me even more so. I have no proof that what I make today is what I will make tomorrow. I budget down to the penny so I know how much I have to earn to stay afloat. (My monthly budget actually has a line that says “BS,” meaning stuff I don’t need but will buy like old video games off Ebay.) Everything else hits savings for really cool stuff I want for the future.

    This is why I still have a 99 Honda I bought from my brother for $550. (Unbelieveable gas mileage and runs great.) Because I learned a long time ago that I am not what I wear or what I drive.

  5. “I know some freelance writers who earned a big payout and immediately blew it on something like a trip or a new car.”

    this is anyone, really! Except, freelance writers I suppose are more likely to get a huge payout as opposed to smaller checks. BUT that means you can buy things like cars with cash and avoid credit fees….

    Some of these posts make me panicky! $900 for childcare– are you a freelancer? $900 was typical for me too, when I worked FT, but I reduced the amount of time my children were in daycare once I started freelancing. I worked in the evenings or weekends when hubby was home, and only paid for PT childcare.

    And not paying taxes on time- yikes. Don’t give the govt more than your fair share!

    • As for the cars, it’s not about them being able to afford it when those big payments come in. I’m talking about the ones who can’t. The ones who blow the money when a contract pays out and forget that they don’t have the steady income for the next few months. And my word choice was poor there. By “new” car I wasn’t talking about brand new — just getting a check for a few grand and running out to replace a car (w/ a used one) because they’d rather not bother with maintenance on the older one they have.

    • I am a freelancer and I work nights and weekends, too. But I am also a full-time high school teacher because I enjoy it. 🙂 So I work almost around the clock, earn buckets and send it all right back out the door again. LOL

      I will say that I paid less last year than I will this year. This year I’ll be paying almost $500 for after school care for my oldest. He’ll be starting kindergarten and gets out of school at the same time I do. I can’t get to him in time to pick him up and I have to pick up his brother first, so I pay out the nose for that it seems. At least he’ll be in an exercise class after school.

      I’m hopeful he’ll make a good friend in the neighborhood during the school year whose mother I trust to take him home for the thirty or forty-five minutes it takes me to get to him. It is absolutely frustrating, I will say.


Leave a Comment