Career Woman

Freelance worker finances can be strengthened with these tactics


This guide outlines several strategies for improving freelance worker finances and financial stability.

Statistics suggest that over 50% of the US workforce will be freelance by 2027. Freelancing has become increasingly common in the last decade, and numbers have shot up since the pandemic. There are multiple advantages to switching to a freelance career, but there are also disadvantages. In this informative guide, we’ll outline some simple steps you can take to reduce financial risks. 

How to grow freelance worker financial strength

Save as much as possible

One of the most significant risks for any freelance worker is a lack of stability. When you are employed, the company you work for will pay you a set amount every week or month.

When you freelance, you may go through periods when you earn a lot followed by quieter months when your earnings plummet. There is always a chance that you could lose work or that you have to turn down a project due to illness, for example. Try to save as much as possible to ensure you have access to funds if you do have a slow month or year, or you can’t work for a period of time.

If you have savings, you can ride out the quieter times and then boost your savings balances when work picks up or you’re able to take on more clients or work longer hours. Compare savings accounts and aim to transfer a set amount each month. If you have a bumper period, you can top up your account.

Stick to a budget

Many people draw up a monthly budget because they get paid once a month. If you’re a freelance worker, budgeting can be more difficult because you might get paid more or less frequently and you may not know exactly when you’ll get paid.

Try to stick to a regular budget. Set out a plan for the week or month ahead and update it as and when you have payments to add or expenses to subtract. Use your budget to set spending limits and establish how much you can save or use to pay off debts. It’s also beneficial to analyze your finances when you’re budgeting.

Go through your bank statements and look at where you are spending your money. If you’re trying to save more or reduce debts, identify areas where you can make cuts, for example, going out less, spending less on groceries, or canceling memberships and subscriptions you don’t use. 

When you’re budgeting as a freelance worker, don’t forget to include taxes. You will need to complete a tax return and make sure you pay your tax bill on time. It’s best to put money aside weekly or monthly so that you can transfer your payment without worrying about taking a huge financial hit as the deadline looms. 

Make sure you have insurance

Freelancers don’t have access to the benefits packages that employers offer. This means that you’ll need to factor in the cost of buying insurance when creating your budget. Insurance is crucial as it offers financial protection.

If you don’t have insurance and you end up in the hospital or you need to carry out emergency repairs to your home, for example, the costs could spiral. Explore different types of insurance, compare prices and policies from different providers to find the best deals and seek advice from financial advisors.

If you’re a freelance worker, it may be beneficial to add extra policies to cover loss of income or to take out a higher level of health insurance to protect you if you can’t work due to illness. 

Keep a close eye on your debts

The vast majority of adults are in debt, but this is not always a negative situation. If you have a mortgage, for example, and you’re paying back the loan each month, you don’t need to worry.

If you are struggling to make repayments, you have multiple loans and you’re using credit cards to get from one paycheck to the next, this can be problematic for a freelance worker. Debts can spiral out of control very quickly and before you know it, you may be getting letters or calls from creditors and final payment demands.

Keep a close eye on your debts, check balances, and try to avoid using credit or borrowing money if you already have substantial debt. Paying off high-interest debts first is beneficial, as it can help you to reduce your total debt faster.

If you do reach a point where you’re finding it hard to pay your mortgage or cover bills, seek help. Expert advisors can provide help with everything from the best way to get out of foreclosure to effective solutions for tackling credit card debts and consolidating debt payments.

It’s important to take action at the earliest possible stage to prevent losing control. It’s also wise to use your savings before borrowing money or using credit cards if you don’t have sufficient funds in your checking or current account. Paying off debts will ease financial pressures and stress and help you to improve your credit score. 

Plan for retirement

When you’re a freelance worker, it’s not as easy to plan for your retirement because you don’t have access to pensions and savings schemes through your employer. However, there are other avenues to explore.

It’s helpful to start putting money aside as soon as you can to ensure that you can enjoy a comfortable retirement. Tackle debts first, set up an emergency fund and then save what you can for the future. It’s worth seeking expert advice to help you determine which plans and financial products will be most beneficial for you. 

As well as saving for your retirement, you may wish to consider investing as a means of making money. If you have funds available, you can invest money to try to boost your income.

Depending on how much you want to invest, the level of risk you can tolerate and how quickly you want to make money, you could look into options such as trading stocks, buying real estate to flip or rent, buying commodities or investing in bonds. Take the time to research and learn how different investments work and make use of free demos and trials before you spend any money. 


Being a freelance worker offers flexibility, control and the opportunity to manage your schedule, client base and earnings, but it can also be risky. To reduce financial risks and prevent stress, try to be proactive in managing your money.

Draw up a budget each month, keep a close eye on your accounts and debts, try to save as much as possible and make sure you have insurance. Seek advice if you’re struggling to pay off debts or you’re looking to save or invest for your retirement and live within your means. 

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