Was tax season your nerve-racking wake-up call? Like… well, I guess there’s more to this whole freelancer gig than drinking a lot of coffee and being a digital nomad?
Well… you wouldn’t be the first one to have that epiphany…
Keep watching for 5 tips for streamlining your freelancing biz to make it profitable, rewarding, and most importantly—stress-free!
Working for yourself is great!
You get to set your own hours, work whenever and wherever you want, be ultra-selective with your clientele, and in most cases… you get to do something you genuinely love!
But here’s the thing… If you work for yourself—not only do you need to be great at what you do—whether that’s copywriting, social media management, web design, marketing, and everything in between…
You ALSO need to actually understand how the heck a business works in the first place.
I know. Shocker right?!
Taxes, managing your clients, contracts, invoices, expense tracking, incorporating, separate bank accounts… and the list goes on and on. When you’re just getting started, all of this can feel a little… overwhelming, to say the least.
And I get it! I was in your shoes once and I remember feeling like this was all WAY over my head. But the good news is this…
You don’t have to have it all figured before you get started…
In this article, I’m going to share with you my personal tips and the best practices I’ve picked up over the last 10 years of running my business… So you can worry less about the operational stuff and focus more on expressing your creative genius!
And hey—while I’m fully aware this topic might not be the most interesting subject on the planet, it is—no doubt—important and necessary to talk about.
So at the end of this blog post, I’ll spice it up a bit and share something WAY more interesting…
My super-secret Monday morning “notebook” hack to help you have the most productive week ever…
So stay tuned for that 😉
Hey Posse! What’s up? It’s Alex!
And this week, I’m coming at you with a HIGHLY requested tutorial from the Posse Community.
Tons of fresh freelancers approach me with skyrocketed stress levels and all sorts of questions about the “not so fun” aspects of running a business.
And while I might not be able to give you expert advice, I can share my own experiences with you.
So give me a comment below if you’ve been WAITING for a video like this…
And if you’re new to the crew—welcome! On my blog you’ll find over a hundred tutorials covering the hottest marketing, copywriting, and freelancing tips in the industry today.
Now before I dive into today’s tips I have a big disclaimer to make! Everything I’m about to share comes from the personal experience and lessons that I’ve learned after running my own business over the last 10 years.
I am not by any means an accountant or lawyer or expert or trying to tell what you should—or should not—be doing in your business.
This article is only meant to help inspire you with ideas and best practices you could research or look into to make running your business less daunting and overwhelming—but please always, always, always refer to an accountant or lawyer for specific advice in your niche, market, and location.
Remember that every area of the world has different laws and regulations, so in order to truly and fully understand your own business options and obligations—you really do need to be talking with an expert.
And trust me, at the end of the day the investment is well worth the money to get the peace of mind and confidence that an expert can provide.
Okay, now with that out of the way… let’s dive into the first topic on the list.
Freelancing & Taxes
Yep. Starting with the BIG ONE. This is probably one of the most frequently asked questions I get—so I’m going to give you a few tips that I follow here.
I remember the first year I started my business very vividly. Mostly because at the end of the year I was hit with a tax bill to pay.
My mistake was that I didn’t make quarterly tax payments throughout the year… or put aside money every month into a savings account, so I had to pay a whole year’s worth of taxes in one go.
Now that was definitely a lesson I learned the hard way.
So when it comes to making tax season less stressful, my number #1 tip will always be to make quarterly tax payments or at the very least make sure you’re setting aside a bit of money each month into a separate account that will go towards your taxes.
That way at the end of the year, you won’t be shell-shocked with a massive bill like I was.
Now, my second tip for handling your business taxes and reducing your end-of-year headache is to use an invoicing tool.
I personally use and love Freshbooks—and you guys, this is a game-changer when it comes to tax season.
The invoicing tool keeps track of ALL your income for you, so you can forget about triple-checking your DIY spreadsheet… Yeah, I see all you DIY-ers out there…
With a tool like this one, the only thing you need to do at the end of the year is download a revenue report and hand it right over to your accountant.
Easy-peasy!
But that’s not all you need to hand over to your accountant at the end of the year…
You also need to keep track of—and file—your business expenses.
Now when it comes to keeping track of business expenses, I have some tips there as well.
Firstly, I always make sure to use the same email address for everything business-related. So sending invoices, signing up for subscriptions, classes, purchasing materials, or anything else that’s directly for my business.
Then any monthly invoices or billing receipts I get via email—are immediately tagged in my email account under “Receipts”.
So when it comes to tax time, I can just pull open that folder and download all those receipts and hand them right to my bookkeeper.
And that’s really all you need to do you guys. Freelance taxes are really not that complicated.
I know it can feel really overwhelming when you’re just getting started—but remember that all you really need to do is keep good track of your income and expenses.
And that’s it!
And remember to learn your local regulations and best practices—always reach out to your accountant!
Okay, now on to the next one…
Contracts
Now let me just come right out and say it… you don’t have to use huge beefy contracts with your clients.
But obviously, it is best practice to have some sort of written agreement in place.
Yep—even that friend of a friend that you’re writing a few Ads for should sign a contract before you do any work!
Contracts are important because they clearly lay out the expectations, deliverables, payment details, responsibilities, and so on…
And that way… god forbid you should ever run into any issues with a client not paying you, expecting work that was outside your original scope, or breaking any other terms of the agreement…
You’ll have something to fall back on that can legally protect you.
When working with new clients, I send Statements of Work… which are just simple contracts that lay out the key terms of the agreement.
They aren’t perfect, but they do have the bare minimum and would offer me some level of protection should something ever happen. At the end of this blog post, you can grab a copy of my Statement of Work Template that you can download and send off to your clients right away.
Remember, this is just a starting place. I’d say it’s better to go the extra mile and make sure you’re protected with a contract.
Again, this is something that you should reach out to an expert for. You can pay a lawyer to draft detailed contracts for you—or you can also pay for generic contracts online that would cover the bases.
Alright, now the next topic on the list…
Making Your Business Official
A common misconception is that you have to register your business as an LLC or entity of some type in order to do business.
But that’s actually not the case at all.
The truth is that as soon as you start freelancing—you already ARE a business owner, operating under your own name. Also known as a Sole Proprietor or Independent Contractor.
And you can continue operating your business—aka sending invoices and making purchases—under your own name. I myself didn’t incorporate until 2016. So 5 years after I started my freelancing business.
Why?
For one thing, it costs money to incorporate, there’s often more paperwork and yearly tax forms that need to be completed, and it can be a lot of extra work if you’re not making enough money to leave money in your company.
With that said… as your business grows and you start generating more income… you probably should consider making your business “official” in terms of actually incorporating it and your accountant or business lawyer can help you determine when the best time is for you to do this.
So again, please reach out to your local experts to decide what’s right for you.
Okay, now I’m going to keep this next one pretty short but I want to make sure I touch on it at least briefly…
Tips For Managing Your Clients & Organization
When it comes to client management & organization—this really can make or break your business.
Taking the time to get organized and stay organized is probably the one tip in this whole article that will lower your stress level the most.
Have a folder for every client. Have a folder for invoices, receipts, and contracts. Have a folder for testimonials, a folder for referrals, a folder for ideas, a folder for… you get the point.
Find your own system of organization and stick to it religiously.
Not only does this make running your business super streamlined, but it also makes your life way easier when it comes to paying taxes or pitching to new clients.
Now some of my favorite tools for managing clients are: Zoom for calls and meetings, Email for weekly communication and deliverables, Canva for creating Statements of Work, Freshbooks for invoicing, and Docusign for getting e-signatures.
Simple, uncomplicated—but effective.
Alright now… are you ready for the spice I promised? I know you are 😉
My Super-Secret “Notebook” Hack…
Okay, so it’s no secret that I love notebooks. And if you follow me on Instagram, then you’ve probably seen me post about my MITs, or Most Important Tasks—at the beginning of each month.
But I actually like to sit down every single Monday morning to map out my MITs for the week ahead.
I personally do this using a Moleskine planner, but you could honestly use any type of notebook you want.
On the right side, I start off by listing out all my tasks for the week, categorized by client or project.
Then over here on the left side, where the days of the week are listed, I will write down the critical tasks I need to complete each day in order from top priority to lower priority.
But the secret part is this…
The “critical tasks” for each day might not be the ENTIRE task, but rather a smaller task that works towards accomplishing the big task.
This will keep you super motivated and help you move towards your goals without getting overwhelmed and doing that thing we freelancers all love doing… PROCRASTINATE.
Alright guys, I hope you loved my super-secret notebook hack and I really hope this blog helped ease some stress and fears you might have had about running your own business.
I wanted to stress one more time that you don’t NEED to be doing all of these things—and especially not just to get started.
So please don’t let fear of paperwork or taxes stop you from igniting your business or fulfilling your passion.
I promise once you get going it’s a lot more simple than it seems.
And always, always, always make sure you’re getting expert advice from your local lawyers and accountants.
Now as promised, you can grab your FREE Statement of Work Template right here.
Until next time, I’m Alex. Ciao for now!
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