Finances are never fun to talk about, especially since freelancers tend to always be on the hook for, well, everything. Technically, up-front, you will be. But you can have a logical way to deal with them if you put the right tools and techniques into place to do just that. I “trial and error”-ed my way through learning how to deal with business expenses as a freelancer, so below are the top tips that I still use today!

Top tips for dealing with business expenses

I’m to the point where I can keep business expenses low compared to many freelancers. However, most of that came from learning to understand what I needed and what I didn’t, despite my assumptions or expectations. Take a look.

• Plan them in advance: Most expenses will be either monthly or yearly. Make sure you budget and plan those expenses in advance to know what’s due, when, and how much you have to put away for it. Whether it’s a $50 expense or a $500 expense, planning will help you prevent any nasty surprises.

• Put away a bit of income each month: While you might want to put away as much as you need for your yearly expenses at one time, most of us don’t have enough to do that. So, ensure you tuck away some monthly income for upcoming business expenses. Due to the wonders of freelancing income, it may vary from $5 to $150 each month, but anything and everything will help!

• Keep it simple: Freelancers love bells, whistles, and toys as much as the next person. It’s tempting to go and get everything while thinking, “It’s just a business expense.” Which it is. But do you really need to have every bell and each whistle? Think about keeping your expense list (be them physical or digital products) as streamlined as possible so that you only spend what you need to.

• Do an audit at the end of the year: Our needs will change yearly. At the end of each year, look back on your expenses and see what you can take off your list or factor in what you need to add. I always find that I’m surprised to realize that my needs change as much as they do in a year!

Remember to spend within your needs

Times get tough for freelancers a lot. But, expenses need to be paid even when income drops without warning. One of the most important things I’ve learned is to always assume you won’t have as much money as you hope you will. It returns to that timeless expression: “Hope for the best, plan for the worst.” Keep that in mind when assessing your expenses so that you don’t accidentally overspend.

With the right advice to guide you, dealing with expenses as a freelancer doesn’t have to be scary or complicated. It will be about understanding what you need, what you must do to meet that need, and how to ensure you’re getting what you want out of your expenses each year.

What are some of your essential business expenses? How do you budget for them? Are there any that you renew year after year without thinking about them? Share below!