Three Best Pieces of Financial Advice for Freelancers: Part I

Being a freelancer requires a whole different mindset than being an employee. You can make a living — as Elaine and I have, and as we help people do. But there’s no steady paycheck, and no big benefits package.

We offer plenty of specific financial advice, like how much you need to have in a cash reserve fund, and how to keep C4xRvRB9kLCwdjudd-xX-gVG_iRhgHxyIQez_Z4Ky3Eyou cash flow, well, flowing. But the most important pieces of financial advice I’ve received have been broader. They helped me reframe my mindset from employee to entrepreneur. I’m going to post them one-two-three in the next three days.

#1: Take Care of Yourself

If you are even considering becoming a freelancer, chances are you know a lot about how to make people happy. You’re confident in your people skills and your talents; to greater and lesser degrees, both will be crucial to winning business. You probably also love what you do, which is motivating you both to leave the crushing realities of a corporate job and to have the freedom to practice your profession the way you think best.

In other words: you have the perfect personality to be a freelancer. But there’s a downside to having a passion about your work and about serving the needs of clients. You might tend to put yourself last. Many freelancers I know do this. Out of a combination of passion and the unsteadiness of the income stream, they become chained to their computers. That’s certainly not the point.

One of the key financial concepts for a freelancer is arranging your budget and your schedule so that you can TAKE TIME OFF. You must be able to decompress. It’s even harder if you have children and a spouse, because they are making demands on you too.

My friend Reba Axelson coalesced this for me. A single mom in the 50s, she was widowed very young. I knew her in her late 80s. When I got my divorce, she took me under her wing, fed me and my girls dinner a few times, and told me how she managed emotionally and financially as a single mom. A native Virginian, she could be very stern when she wanted to be, though always in the most genteel accent you can imagine.

(One of her favorite things to say was, “When God was handing out brains, I was standing behind the door,” which was charming because it was so profoundly and laughably untrue; everyone who met her knew Reba was brilliant).

One day as I was leaving her house, I stood by the door with my hand on the knob — I was headed back to my computer. She had bright blue eyes and she looked at me implacably and said, “You need to take care of yourself.”

She had the authority of being a mother figure who wasn’t my mom, and I felt like I had to listen. When I’m tempted to skip a doctor’s appointment, not take time for exercise or say no to a dinner with friends, I remember Reba’s words.

My work gets a lot better when I take time for myself. That time re-energizing is what gives you the distance and space and ability to think clearly.

The ability to prioritize well is the single most important financial skill for a freelancer: You need to have the emotional and intellectual energy to think clearly, so that you can decide what to work on when and how hard to work on each task.

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