These money tips for freelance writers are spurred by the tough economic times – and many freelancers are really feeling the crunch. I know I am – editors have dropped my per word rates, asking me to hold tight until the worst has passed! So, here I have six ways to save and invest (money tips!) from Bills.com for freelance writers…which will help us through the worst of times.

First, a quip about writing and money:

“Writing is turning one’s worst moments into money,” said Irish American author J. P. Donleavy.

There’s a bonus writing tip! Write about your money struggles, or blog about money tips. And, here’s another quip from Donleavy, from his book The Ginger Man: “But Jesus, when you don’t have any money, the problem is food. When you have money, it’s sex. When you have both it’s health, you worry about getting rupture or something. If everything is simply jake then you’re frightened of death,” he wrote.

If it’s not one thing, fellow scribes, it’s another! Okay, here are some money tips from Brad Stroh, co-CEO of Bills.com…oh yeah, and for some renegade tips on making more money as a writer, click on The Renegade Writer by Formichelli and Burrell!

Many self-employed people – from business owners to students who freelance part-time to full-time consultants – do not have traditional employment benefits like direct-deposit paychecks, explains Brad Stroh, co-CEO of Bills.com.  “Many of these hard-working people have income that fluctuates from month to month,” he explains, “making it harder to establish any type of regular savings plan.” 

People whose income fluctuates need to learn to adopt a longer-term view of finances than someone with a regular paycheck coming in each week or month, says Stroh. Generally, after a few years of fluctuation, people can observe patterns – a slump around the holidays or in the summer, for instance – as well as determine a typical monthly minimum income level. Then budgeting, spending and saving can be done with that “base” in mind.

6 Money Tips for Freelance Writers: How to Save and Invest on a Flucuating Income

1. Set baseline goals. A freelance writer could establish an absolute baseline of sufficient savings to cover expenses, such as quarterly estimated self-employment taxes and an emergency fund. Common wisdom suggests keeping six months’ living expenses in an emergency fund at all times. For freelance writers, this fund can become a “floating” fund to pull from during leaner times, then replenish when income increases. This money tip will help you through the lean times.

2. Try “zero-based budgeting.” Everyone has fixed monthly expenses such as rent/mortgage, as well as consistent variable expenses (those that occur each month, but fluctuate, such as food and some utilities). Some freelance writers accumulate savings by holding off on discretionary purchases (luxuries) until they achieve a certain level of savings. Then, they continue to save and allocate a portion of that savings toward a planned seasonal purchase. With this money tip for freelance writers, you can still enjoy your luxuries!

3. Stick to a percent. With each check received (whenever that is), set aside a pre-determined percentage, based on your budget, for savings and investment. Fellow scribes, I use this money tip to pay my taxes every April.

4. Sock away windfalls. When you earn or receive extra money (from a larger client check, a gift or activities such as a yard sale), save rather than spend the excess money. Once you are used to living on your budget, chances are good you’ll actually feel more comfortable if you stick to that budget. If you stash the “extra” – in addition to the regular pre-determined amount – you’ll see your savings soar.

5. Bill yourself. Take advantage of automatic deduction plans you set up. Some financial institutions let you arrange automatic withdrawal from your checking account to a savings account. Record this expense like a bill every month to painlessly accumulate savings. If necessary, start with a small amount like $25 or $50 per month and increase it whenever possible – when you pay off a credit card with a $50 monthly payment, increase your savings by that $50. With the same outflow you have today, you’ll be paying yourself. This money tip for freelance writers will ensure you’re not starving for long.

6. Save like a pro. Don’t just keep savings in your spending account with a mental note that they’re “saved.” Instead, put them in an investment or savings vehicle you’ve selected. If you don’t want savings tied up for the long term, you might choose a money market account that allows withdrawals only at certain minimum levels. Or purchase short-term CDs (three- or six-month terms) on a regular basis. This money tip for freelance writers will provide some interest earnings and force you to constantly reinvest.

“Whatever method you choose, do save, and do so on a consistent basis,” advises Stroh.  “Chances are good that you’ll be surprised – and inspired – by the way your funds accumulate.”

Based in San Mateo, Calif., Bills.com  is a free one-stop portal where consumers can educate themselves about complex personal finance issues and comparison shop for products and services including credit cards, debt relief assistance, insurance, mortgages and other loans.

Do you have any money tips or secrets for freelance writers – or ways to ensure you’re meeting your financial goals? Please comment below!

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