Whether you are just starting out as a freelancer, home-based business owner or micro-business, you will benefit from tips that save you money and time. A freelancing career is rewarding and has its freedoms, although it can be a little scary, too. Your income may fluctuate from month to month depending on how much work you can bring in. Knowing this about your life, you can plan for lean months by learning to be frugal.
All successful small business owners understand that by operating lean and reducing expenses, there is more left in the bank to pay yourself or reinvest into your business. Once you begin finding ways to save money, operating your business frugally becomes a fun and rewarding challenge.
Here are ten money saving tips that can help you cut costs and keep more of your money.
Flareapps.com small business tip #042Track Time and Projects
Tracking time is a skill that is vital to a freelancer’s success. Tracking time means you can more accurately estimate the real cost of projects in the future. Tracked time becomes a benchmark for future service provision. Knowing how long a past project took you and what it cost will prevent you from quoting too low in the future. Read this post about time tracking for more details.
Flareapps.com small business tip #043Outsource Some Services
Outsourcing some of your services will save you time, and as the saying goes “Time is money”. While outsourcing has a cost, it frees you up to do more work. Imagine being a freelance web designer who provides a range of services from logo design to WordPress installation and everything in between. Some of these services, particularly the routine but time-consuming tasks could be outsourced.
Hire an overseas freelancer
Hire an offshore freelancer from services like Fiverr.com or Freelancer.com. There are many such websites whose members offer gigs of all variety such as writing, graphic design, web design, marketing, brochure design, and many more. Often, because the cost of living is less than in North America, you pay far less for the services.
Check out this list of 15 outsourcing websites.
Some services you won’t be able to find offshore workers to perform, and, you may feel you’d rather support the local economy. Outsourcing some work to other local freelancers is one way to free up time while putting a little money in your pocket. You may be able to find a new, eager and competent freelancer who is hungry for work and therefore charges a little less. You can still provide fair market price to your client while taking a markup for the work provided.
You can feel very good about working this way because everyone wins: your client still gets value; you earn a little money; a new freelancer gets some income and some experience, and; you have more time for more lucrative work.
Flareapps.com small business tip #044Pay Your Credit Card Bills
Staying debt-free (or as debt free as possible) is a lesson that pays dividends if you learn it early in your freelance career. Credit cards can be a trap when you are starting out and strapped for cash. Think of credit as a very last resort. If you can wait to make a purchase with your hard-earned cash, you won’t be paying interest and more importantly your credit card debt won’t sneak up on you.
Flareapps.com small business tip #045Avoid Unnecessary Expenses and Debt
Do you really need that new computer, latest and greatest cell phone, new office chair, new “whatever-you-call-it”? Before making a purchase, consider its actual value. Is the purchase a luxury or mere convenience? A must-have or want to-have? Will the expense mean you can earn more money or is it something that you could live without?
Some debt, if manageable, may mean you can earn more income. For example, if you advertise online and you run up $750/month in online ad expenses which brings in $4000 worth of income, it may justify the expense. Just make sure you follow rule #044 and pay off that credit card expense for the ad as soon as you can. If you are paying cash from the bank, make sure you can handle the cash outflow. Don’t exhaust or nearly exhaust your funds on a gamble. Make sure you can afford the loss in case it doesn’t pan out.
Flareapps.com small business tip #046Use Skype for Meetings
Meetings take time. If you are travelling to clients for meetings, suggest Skype meetings as an alternative. Doing so saves time and travel expenses. Skype is convenient, free and easy to use. Don’t want to use Skype? Try these alternatives.
Flareapps.com small business tip #047Use Free Open Source Software When You Can
Software can be a costly expense. There are free software applications for word processing, spreadsheets, presentations, web authoring, mail, and project management. Here are just a few:
OpenOffice is a very good alternative to that ubiquitous office application we won’t name. It has a full featured word processor, spreadsheets, multimedia presentations, drawing, desktop database management and more. It will save in many formats too, so you don’t have to be concerned that someone won’t be able to open the files you create with OpenOffice.
Thunderbird is an overlooked desktop email application. It provides what many top-drawer email apps provide and it does it all for free. You get all of the features you need including tabbed email, calendar integration (Mozilla Lightening), integrated chat, search tools, email security features, junk filters, and phishing protection.
Free project management apps
Whether you work with other people or by yourself, project management makes you more efficient and saves time. Track project time, tasks and sub-tasks, project expenses and collaborate with other people and clients. Try Freedcamp or Bitrix24 or check out this list from LifeHacker. If you work in a small team, consider installing OpenProject. It can be installed on the web or company Intranet and is accessed from a web browser. Features include projects, timelines, wiki, time and cost tracking, document sharing and more.
Flareapps.com small business tip #048Claim Every Expense You Can
Talk to your accountant and also educate yourself about what can be claimed as a deduction.
A few expenses that freelancers may be able to deduct include:
- Home office
- Domain name and web hosting
- Computer and other office equipment
- Online apps
- Office supplies
- Business meals
- Rental or home owner’s insurance
- Travel expenses
- Medical insurance
- Bank fees
For an exhaustive list see The best tax deductions for entrepreneurs and freelancers at Millo.co. Please note that this article is for informational purposes only. Always consult official IRS documents or a qualified bookkeeper or accountant.
Flareapps.com small business tip #049Provide Discounts on Long Term Contracts
Package some of your services as monthly offerings with a minimum 1-year contract and entice would-be clients with a discount. A few long-term service contracts can get you over lean times and provide income you can count on. They also reduce the cost in time and money spent trying to find new business.
Flareapps.com small business tip #050Work from Home or Share an Office
Working from home can be the best way to save money as a freelancer or micro-business. The advantages are obvious: it’s convenience and it’s all but free. If you work in a small team, like more privacy, or need to meet clients, consider a shared office space. Check out Regus, Premiere Business Centers, and of course Craigslist.
Flareapps.com small business tip #051Use All-In-One Financial Management Software
If you move away from managing your business on paper or various spreadsheets and instead choose financial management software that will do it all for you, you will save both time and money. Find cloud-based small business accounting software that will let you: create and send invoices, track income and expenses, monitor your bank account, create budgets and run reports for your accountant at tax time. There are a few applications to choose from. We hope you use Flare online accounting.
Shameless plug aside, having one software application do all of these things is time saving and cost saving. Many freelancers and micro-businesses have invoicing in one place, and bookkeeping in another. They might be using word processing templates for invoices and spreadsheets to track income and expenses; they may be using one online application for invoicing and one for bookkeeping; or, they may be using invoicing software alone and neglecting to track income and expenses.
The benefit of an all-in-one small business finance applications is that for a monthly fee that is equivalent to a few cups of coffee per week, you manage all of your business finances in one place. At tax time, you’ll save money, too, because your bookkeeper or accountant will have to spend less time.