How To Set A Budget As A Freelancer
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How To Set A Budget As A Freelancer

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“A budget is telling your money where to go instead of wondering where it went.”-Dave Ramsey

Have you ever wondered where your income has gone? Where did you spend it or what did you spend it on? Almost all of us have gone through this at some point in our lives, but there comes a time when we have to stop spending carelessly and start budgeting.

It’s time to grow up! Gone are the days of not having to worry about paying bills and other necessities yourself. Budgeting takes time, responsibility and a lot of patience. It’s not as simple as just putting money in the bank, there is a lot of planning and prioritizing that needs to be done by you and/or your family.

Some may have a steady income, but there are many who don’t. Either way, you have to learn how to budget your money wisely. There are freelancers and those who earn based on commission have additional budgeting challenges as you are never sure how much you will be earning or when you will be paid.

There are many perks of being your own boss. Your time is flexible and you can make your own decisions, but it is your duty to manage the finances well so that both your personal and professional life will thrive.

Learn these six easy ways to start budgeting your money. Your future will thank you for it!


The golden rule of budgeting is to write everything down. Write it in your notebook or keep track of them in an online accounting software like FreshBooks or Wave. Knowing your fixed and variable expenses is so important.

This is where you can calculate back in reverse and determine how much you actually spend in a month. This can include food, gas, electricity, rent, etc.  If it leaves your bank account write it down.

If you see a pattern of spending then include it in your monthly budget. After gathering all this information, you can now estimate how much you need to be earning to be able to continue living the lifestyle that you want.


Recognize what are the most important expenses that you would need to budget for. This boils down to all the basic needs you or your family would need like food, shelter, water, electricity, heat, etc. You need to budget this first. Plan for your current expenses first, then place the rest in an emergency fund or a savings account.

If you are a freelancer, it is wise to plan your budget a month ahead as well. If your income for the month is less than you were planning on you will have a backup plan.


When you work as a freelancer or work based on commission, your paycheck is never the same. Some months will be great and others…not so much. The smaller paycheck is the one you need to base your budget on. This helps you budget to the bare minimum just in case you would need to.

What is the least amount of money that you would need to keep your business going and your household running smoothly? Is there something you are spending on that you can cut back from?

Analyzing these parts of your budget is valuable to know in these instances. Once again, take note of all of this and practice mindful budgeting. Compare expenses between certain periods of time and see if you are spending too much money in some areas.

4) LEARN THE 50/20/30 RULE

This rule divides what you need to do with your monthly paycheck. 50% on needs, 20% on savings, and 30% on wants. This concept is easy to understand and practice when you start budgeting.

50% are your fixed costs and essential expenses. These are the basic needs for you and your family, like rent, groceries, car payments and utilities.

20% savings is what you will put in your savings account. This is the money you will reach into when there is an emergency, you are making a large purchase (like purchasing a home) and your retirement.

30% is for flexible spending. This includes eating out, buying clothes, school supplies, entertainment, etc. If you can pinch more in this budget then it’s best to do so and move some of the money to your savings.


As a freelancer, you may not be sure when your next paycheck will be once you have completed a project. It is best to set up an invoice system and a billing period for your clients. If you are using FreshBooks to track your expenses you can also do invoicing. With this link you can get a free month of FreshBooks. Wave is another great online accounting source and offers a free plan.

This gives you peace of mind since now you will know when you will be getting your payment. Be clear about your terms and conditions beforehand so that your client will know when to prepare your money and what date they will have to send it.


When you are self-employed and running your own business, your budget between your personal and professional life can get a little blurry. Sometimes you will be tempted to use money intended for your business to pay for your house bills for example. This should not happen. It would especially make keeping track of your expenses more difficult.

If you do have an irregular income, you may benefit if you open a few bank accounts. Other than a savings account, you can categorize this by making accounts for your travel expenses, emergency funds, and other aspects that you think you would need to save up for. That way, expenses would get mixed up and you can track easily how much are in these accounts. If you need to go on a business trip, then you reach into your travel account instead of your savings and have a clear view of how much you should budget for your trip.

Budgeting is not easy and for some, it is not a fun thing to do. It is normal to be tempted to just live and spend when you need to or want to, but you are just setting yourself, your business and your family for possible troubles in the future. It is good to be optimistic, but it doesn’t hurt to be cautious as well.

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McKinzie Bean
McKinzie is a mom of two, and a personal finance enthusiast. She loves teaching other moms how to save money, make money, and take control of their financial situation. She has started five profitable businesses and in college, she double-majored in Financial Planning and Psychology. You may have seen her in publications like Forbes, The US Chamber of Commerce, Yahoo Finance,, The Penny Hoarder, & more.

14 thoughts on “How To Set A Budget As A Freelancer”

  1. This is great info. I find it so challenging to budget as a freelancer. There was a time when both my husband and I freelanced. That was insane!

    1. That would be so hectic! My husbands income is consistent which is nice, but it definitely has been a struggle to budget my income. I am so glad that you found this post helpful!

    1. Budgets are so important especially when you are living on one income. I became a stay at home mom in early 2015 and living on one income was definitely as stretch! Since then I have started a few side hustles to help cover some of our additional expenses. Good luck to you and your family 🙂

    1. Thanks so much for taking the time to comment! It is extra difficult to budget when your income varies month to month.

  2. I love that 50/20/30 rule! What a great idea, and it makes it so simple, doesn’t matter how much you’re earning, apply that rule and you’re all good. Thanks so much for sharing 🙂

  3. I agree with what you have to say about the importance of budgeting for freelancers. It’s so important to plan when your income is irregular. Keep up the good work here and don’t forget to live unstoppable!

    1. Hi Rhonda! Thanks for the encouragement. It definitely can be tricky with an irregular income. I hope these tips will help you 🙂

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