Reading Yo’s last post about accountability really got me to thinking, “Are people having financial trouble because they failed to take ownership of their finances?” Could that one word – ownership – have prevented the entire mortgage meltdown and subsequent recession?
Taking ownership of your freelance finances means charging a rate you can live on. It means managing the money you have and storing the excess for times you don’t have as much.
When you take ownership of something, you think and plan for the long term. You make sacrifices today so you’ll have something to look forward to tomorrow. Can you make it as a freelance writer if you never take ownership of your finances? I don’t think so.
If you never take ownership of your finances you may:
- Accept jobs that pay an unacceptable rate.
- Build your freelance career solely on content mills and other low-paying work.
- Spend more money than you can afford to.
- Mismanage your money and ignore the importance of budgeting.
- Take a head in the sand approach to your checking and savings account balances.
- Drain your savings and use debt to make ends meet.
- Fail to set aside money for taxes and end up with an IRS collection.
- Take out a loan you can’t afford because the bank says you qualify.
- Spend the extra money you make during “feast” months rather than save it for a famine.
- Market your freelance services only when you’re broke.
“How do I take ownership of my finances?”
Make a budget. There are budget worksheets all over the internet. Don’t mull over them for days trying to figure out which one will work for you. Just print a few, try them out, and tweak one until it works for you.
Evaluate your rates, often. Get in the habit of looking at your rates often to determine if they’re high enough to maintain your lifestyle. When you have a baby, buy a house, get married, or get a divorce, look at your rates to make sure you can continue to live on your current rate.
Stop making excuses. “I don’t make enough money to start an emergency fund.” “I can’t afford to pay my taxes.” Any rebuttal to taking ownership of your finances is an excuse. It’s as simple as that. With proper planning, I’m sure you can afford to take the steps you need to have complete ownership of your finances.
Realize that financial success is key to your freelance success. It doesn’t matter how well you write or market, if you’re not getting paid or you’re mismanaging your money, you won’t be a freelance writer for long.
I know the economy is bad and all that jazz, but I wholeheartedly believe that if you take ownership of your finances, you can make it. It may mean sacrificing. It may mean increasing your rate. It may even mean supplementing your income with some content mill work. If you take ownership of your finances, you'll figure out a way to make it work.
I recently (like, in the last couple of weeks) almost doubled my hourly rate. It came about because I realised I was making stuff-all money, and went to see a business advisor, who said that what I was charging for copywriting was way too low. I was surprised, but looked into it by mystery shopping some other copywriters in NZ – some big players and not-so-big ones – and it turned out that indeed, I was charging far too little. So I thought about it, chose a new rate, and you know what? The very first client I told this new rate just said okay. No grimace, no argument, just said yes.
So I’ve painlessly given myself a huge pay increase, and I have a feeling I’ll actually get more work. When you don’t charge enough, people assume you’re no good – which I always knew, but this has highlighted the importance of actually knowing how much to charge.
I always feel like such a bad person when I have these thoughts, so I was glad to see you write them 🙂 I have a post idea sitting in my notes right now, and here is what I had written:
“Is the economy bad or are people just not looking for work? List of places to look for work”
I had the same thoughts as you–that accountability is the biggest issue with our current economy. There is a documentary–In Debt We Trust–and in it many consumers are interviewed about credit card debt. So many of them bought things on credit because they thought they deserved the things rather than that they actually could afford them. Others got mortgages because the banks told them they could afford it. I mean, I hate that consumers are taken advantage of on such a consistent basis, but when they clearly have a hand in the damage it makes it that much harder to fight for consumer protection.
@Lucy. ITA. I pass up things all the time because the price is too low to believe I’d get good quality. Congrats on raising your rates.
@Yo, I felt bad too. No one wants to be the one to say that Little Red Riding Hood was dumb for walking alone in the woods in the first place. Sometimes we need to be scolded a little bit.