- Dec. 14
- Richard Parker
Watching the Pennies: Minimizing Debt When You Work as a Freelancer
Debt is the grim specter that hangs over us in every aspect of our lives. When we start to take more control of our lives, either by going self-employed or starting to freelance, we’ve got to take a shrewd approach to monitoring our outgoings. And if we start freelancing, but we are already out of pocket or going through a difficult financial time, what can we do to ensure that we minimize this debt?
Is There Any Way to Wipe the Slate Clean?
While bankruptcy is is, for most, the last option, if you’ve been struggling financially for some time, and you feel that you just need to make a new start, bankruptcy might be the right option. You might have already been working hard at acquiring new contracts, and making significant progress, but because you’ve got a lot of debt to pay back, it seems to knock you back to square one. It’s always worth consulting legal specialists, like the law offices of Adam C. Gomerman to see if it is a viable option. Wiping the slate clean in such a grand fashion can prove beneficial. But you certainly need to weigh up your options first. If you’ve been in major debt for years, you’ve got to think twice.
Keeping Your Books Tidy
Going self-employed means, for most of us, looking after our finances. If you’ve started your freelancing journey with debt, it’s important to get into the mindset of the documenting every single transaction. The great thing about learning to keep your books tidy means you will learn how to truly observe every penny that enters your bank account, but these habits can inform your lifestyle as well. When you start to get into the habit of keeping your books tidy, it is going to make for a more structured approach to freelancing. Once you start to minimize your outgoings, you can then take a more tactical approach to minimizing debt.
Tackling Debt Efficiently
As a freelancer, you may decide to take on more work in order to clear your debt but you’ve got to make sure you have the right balance. For those people that have just started in the world of freelancing, the idea of working as much as you want can seem appealing. But if you’ve got a lot of debt, you may very well want to find more tasks on sites like Upwork or Guru. But when you get into this mindset of forever looking for work, you’ve got to remember that if you are trying to pay off debt, lifestyle changes can help as well. Being a freelancer can mean that we may believe we’ve got to spend money to make money. And yes, we can claim expenses for certain items but when we have a lot of debt, it’s important that we make those proper shifts in our mindset. Learning not to overspend, eating cheaper foods, as well as maintaining a healthier approach to spending money are all things that can help you minimize your debt.
We have to remember that being a freelancer means that there is a feast or famine approach to earning money. Sometimes you have great months, and sometimes it can be the polar opposite. And while there’s freedom in your work, you will have to watch the pennies even more closely.