Freelancers

How to Set a Budget for Your Freelance Business

A step-by-step process to create a freelance budget you’ll actually stick to

Many freelancers spend a lot of money on business expenses without first considering whether we can afford to. Part of the problem is not having a freelance budget in place to guide spending decisions. I’m sure we’ve all been guilty of spending without thinking at some point, especially when it comes to professional development (just one more webinar, I promise — this one looks so useful…).

Overcoming this issue of overspending is all about having a strategy for how much you can afford to spend on different types of expenses. A little planning upfront can help ensure you have enough money to cover everything you need without eating too much into your earnings.

freelance budget

[Disclaimer: This post contains referral and/or affiliate links, meaning I will earn a small reward or commission from qualifying purchases at no extra cost to you]


Get in the right mindset


Some people say they don’t like budgeting because it restricts them or they’re never able to stick to the budget they set.

If you go into it thinking you won’t be able to stick to it, then you probably won’t. You’re effectively giving yourself permission to fail. There’s a quote I love by Henry Ford: “Whether you think you can or think you can’t, you’re right”.

Think of it like this: having a budget for your freelance business can actually help you to make spending decisions. When your freelance budget has an allocation for software or marketing, for example, you can decide to spend money on those things without any guilt.

And remember, if you don’t rein in your spending, it’s less money for you to take home each month.

The key is to set a freelance budget that doesn’t feel restrictive. The best way to do that? Base it on real numbers from your business.

‘Profit First’ by Mike Michalowicz

If you aren’t confident in handling your business finances as a freelancer, or you want to know how you can level out your earnings from month to month to overcome the feast-and-famine cycle, I highly recommend you read this book.

The author details a system that effectively flips business finances on their head, ensuring that you run a profitable business first and foremost and that your business expenses fall in line with what you can afford.

It’s written for business owners as a whole, not specifically owners of freelance businesses. There are therefore some parts that won’t be relevant to you, but you can choose to implement the bits that you think are appropriate for your own business.

Click here to shop the book on Amazon.


Data is your best friend


Start by going through your bank statements, Excel spreadsheets, or accounting software (whatever you use to manage your business finances) for the last year. Note down all the expenses you come across.

First, exclude (cross out) amounts you’ve subcontracted to colleagues or subscriptions that you’ve since cancelled.

Next, it’s important to distinguish between fixed expenses and variable expenses. Fixed expenses are those that will remain the same regardless of the amount of paid work you undertake (i.e. insurance), whereas variable expenses are those that are incurred based on the paid projects you take on (i.e. travel or project-specific training).

Variable expenses should be passed on to the client directly in the rate you charge them, so we’ll discount them here (cross them off the list). Fixed expenses are what we’re interested in for the purposes of setting a budget.

Classify your fixed expenses as one of the following:

  • absolutely essential to your freelance business
  • necessary but perhaps you don’t need to spend so much
  • unnecessary but nice to have
  • unnecessary and you didn’t get value from it

Absolutely essential to your business

You’re not going to do anything with these for now. Just leave them on the list.

Necessary but perhaps you don’t need to spend so much

If you think there might be a cheaper alternative, do some research. Could you find a cheaper competitor offering a similar service or product? What are you getting for the extra money, and is it worth it to you?

Unnecessary but nice to have

Look at how much of what you spent was actually valuable. Cross out any entries that did not represent a good return on investment for you.

Unnecessary and you didn’t get value from it

If they were one-time transactions, cross them off the list. If they’re subscriptions, go ahead and cancel them straightaway, then cross them off the list.


freelance budget

Take a long, hard look at the numbers


Once you’ve narrowed down your list to just those things that you really need or find valuable, take a look at the total amount they come to. Compare that figure to the total amount you actually earned over the same 12 months. What percentage of your income do your expenses represent? Are you happy with that percentage? If not, you have two options:

  1. Find a way to earn more;
  2. Go back to the previous stage and cut more expenses from the list.

Be careful with option two, though. Cutting too much may not be realistic, meaning you end up finding your budget too restrictive and abandoning it altogether.


Categorize for clarity


Take the remaining expenses on your list and sort them into categories. These might include, but are not limited to:

  • advertising
  • bank/transaction fees
  • equipment
  • gifts for clients
  • insurance
  • IT/software
  • marketing
  • memberships
  • networking
  • office furniture/supplies
  • training/professional development
  • travel

For ease, round the total amount for each category up to a whole number. Now add a category for unexpected expenses. Imagine if your computer were to break or some other emergency situation were to occur. How much would you need to have put aside to cover any additional costs?


The icky maths bit


Now take the total amount you’ll need to set aside for your (planned and emergency) expenses over the course of the year and divide it by 12. This tells you how much you’ll have to put aside each month towards your freelance budget.

Of course, you might have months when your expenses seem to cluster together and other months without any. But the aim is to put the same amount aside every month so that you have a constant pot of money for expenses when they arise.

Once you’re clear on how much you need to earn to cover your expenses, you can use that as a starting point for setting your rates. Other things to take into account include your personal expenses (if you don’t already have a personal budget, repeat this process for your non-business expenses), tax and other mandatory contributions you’ll have to pay, and payments you want to make into a pension.

Think you’ll struggle to stay disciplined in setting money aside for expenses and not going over-budget?

Try having separate accounts within your business banking for different pots of money. Many banks will let you open savings accounts for free.

Whenever a payment comes into your main account, divide it up into percentages for different purposes and transfer those funds into the appropriate accounts.

You could have an account with your allocation for expenses, an account with money set aside for tax and other contributions, an account for your own salary, and even an account for profit (from which you pay yourself a bonus periodically).

When the time comes to make a spending decision, you just check your expenses account to see whether you can afford what you want to buy.


Regular check-ins


There’s no point having a freelance budget if you don’t check on your business spending on a regular basis. Decide how frequently you’re going to do this (once per month is a good starting point) and add it to your calendar as a non-negotiable. When the time comes, look at:

  • your earnings since the last check-in
  • how much you’ve spent on business expenses
  • the amount left in the budget for each category
  • what expenses you know you’ve got coming up before your next check-in

Are you on track, or has your spending got a bit out of hand this month? The more you pay attention to your finances, the easier it becomes to regulate your spending.


Update your freelance budget annually


You should go through this full budget-setting process (at least) once per year. Things change when you’re a freelancer, so it’s important to ensure you’re setting enough money aside to cover what you need for your business.

If you’ve got money left over in the budget when you do your yearly review, you have a few options to choose from or combine:

  • allocate that leftover money directly to your emergency fund for the coming year;
  • put the money towards a big-ticket item you might have had your eye on for your freelance business but didn’t feel you had the budget for;
  • pay yourself an end-of-year bonus;
  • reduce your freelance budget (and therefore your required monthly allocation) for the year ahead.

Do you have a budget for your freelance business? And do you manage to stick to it? Let me know in the comments!

Posted by Susie in Freelancers, 2 comments

My Favourite To-Do List App

How Todoist helps me stay on top of everything I have to get done

As freelancers, we often have a to-do list a mile long. Job for client A with one deadline? Check. Job for client B with a different deadline? Check. Invoicing and keeping on top of client payments? Posting on social media? Attending that webinar on Tuesday? Check, check, check.

And don’t forget that, since many of us work from home, we’re constantly being reminded by our surroundings of all the things we have to get done that aren’t business-related. Need to iron that shirt before your client meeting next week? Cat food supplies getting low? Got to buy a gift for your mother-in-law’s birthday next month? The mental load can be overwhelming.

So what if I told you you don’t have to keep all that in your mind all the time? What if there were an easy way to keep on top of everything without the mental burden? Read on.

[Disclaimer: This post contains referral links, meaning I will earn a small reward from qualifying purchases at no extra cost to you]


My Top 3 Features


1. My to-do list syncs across all my devices

With versions of Todoist for all your devices, you can take your to-do list with you everywhere. No more scraps of paper floating around or a heavy notebook weighing down your bag. Whether you use a PC or a Mac, an iPhone or an Android phone, you can rest assured Todoist has catered for you. Plus, the plug-ins for Gmail and Outlook and extensions for Chrome, Safari, and Firefox mean you can add tasks to your to-do list right from your email or web browser.

2. It’s easy to set due dates

To-do list due dates

Todoist understands natural language, meaning you can type a due date as you would say it. But there’s also a more traditional calendar view, if you prefer to pick a date that way.

Type ‘at 2pm on Thursday’ and the task will be added to your to-do list with that deadline. You can even set recurring due dates, just by typing something like ‘every Monday’ or ‘every two weeks’.

3. I can colour-code tasks by priority level

To-do list priority level

With four different colour levels to choose from, you can decide how important a task is and work through your to-do list in order of priority.

I use level 1 for non-negotiables, like client deadlines and payment dates. Level 2 is for things that should be done on or by the specified date, but could be postponed if absolutely necessary. I use Level 3 for tasks that it would be nice to do by particular day, but that are flexible (laundry, anyone?). And Level 4 is for tasks that either are really not very important or don’t have a due date (like items on my shopping list).


Other Free Features


View tasks for Today or the Next 7 Days

‘Next 7 Days’ is my default view. It lets me see everything I have coming up, and the tasks within each day are ordered by priority.

Divide projects into tasks and sub-tasks

You can set up different projects for the various types of thing you have to think about (client jobs, marketing, admin, housework, shopping, etc.). Then you add tasks and sub-tasks within them, keeping everything neat and organized.

Share your to-do list with collaborators

If you’re working closely with another freelancer on a job, you can share the project with them and assign the tasks between you. That way you’ll always know who’s doing what and when.

Use keyboard shortcuts

Todoist has lots of little shortcuts that help speed you up. Want to quickly add a new task to your to-do list? Just press Q on your keyboard.

Visualize your productivity over time

Want to make sure you stay productive? Set daily and weekly goals for the number of tasks you’ll complete, and watch your streak continue as you achieve them.

Integrate Todoist with other apps

If, like me, you’re a fan of automation, you’ll love Todoist’s integrations. Link it up to Google Calendar, Toggl, DropBox, Slack, and more to have everything at your fingertips. And if you use a tool Todoist doesn’t yet integrate with, chances are you can set it up through Zapier or IFTTT.


The Paid Plan


With all those features available for free, you may be wondering why you’d ever need to upgrade to Todoist Premium. Many people use the free plan happily forever, but the Premium plan does have some useful features too.

Get reminders for your tasks

Want a reminder when you have a task due? Choose whether you want to receive it by phone or email. And need to remember to buy more printer paper? Set a reminder with a location and Todoist will prompt you when you’re near your favourite office supplies store. Clever, right?

Create project templates

If you frequently have projects that involve the same tasks, save yourself time by creating your own template.

Customize labels

Create your own labels that you can assign to tasks. I use these to show me how long a task might take, with labels such as ‘less than 5 minutes’, ‘less than 30 minutes’, and ‘more than 30 minutes’. If I’ve got a few minutes before a client call, I can get easily something quick crossed off my to-do-list.

Choose from a range of themes

Personalize Todoist by choosing your own colour scheme. This can be different on each device or synced across all of them.

Attach files and add comments to tasks

Working with others on a project and need to discuss a task before it can be completed? Add comments to tasks, tag people, and upload attachments for discussion.

Create customized views for your to-do list

View your to-do list by project, due date, priority level, label, assignee – or even a combination! You name it and it’s probably possible to create that filter.

The Premium plan costs just £3/$3 per month, and you can switch back to the free plan at any time.


How to Get Started


Want to give it a go? Click the button below to get 2 months of Todoist Premium for free and try out all the features. If you decide you don’t need the Premium features after those two months, switch to the free plan and you won’t be charged a penny.

Got a question about Todoist? I’d be happy to help if I can. Send me an email or post in the comments.

Posted by Susie in Freelancers, 0 comments

10 Tips for Attending Your First Conference

A Beginner’s Survival Guide

The nature of our work as freelancers can mean we spend very little time with colleagues in person. Industry conferences are a great opportunity to network and learn from our peers, and you’ll probably go home energized and enthused by the possibilities for your business. But what if you’ve never attended one before? How are you supposed to know what to expect from your first conference?

If you’re hesitating about dipping your toe into the conference waters, here are my tips for how to get the most from attending your first conference.

[Disclaimer: This post contains referral links, meaning I will earn a small reward from qualifying purchases at no extra cost to you]


1) Choose a conference that has an element of familiarity


If you’re attending a conference for the first time in a city you’ve never visited or where you don’t speak the language, you’ll be putting additional pressure on yourself. If possible, choose a location you’ve visited before or where you know you’ll be able to communicate with those around you. It’s well worth making life easier for yourself!


2) Participate in as much as you can


The majority of us spend most of our time working alone. The conference will be tiring and you’ll probably be tempted to skip some sessions, stay in bed that little bit longer, or catch up on some work at your hotel. Don’t listen to your brain when it tells you to do this. After all, we can do those things whenever we like, but it isn’t every day we have the chance to meet and learn from colleagues. Even if you aren’t sure about some of the sessions from the title and description, you’re bound to learn something from them all.


3) Put yourself out there and meet people


Say yes to opportunities to socialize. Other freelancers aren’t so scary when you actually start talking to them. If you’re nervous about this, try opting for small social events with few attendees. The size of the group will mean that everyone is involved in conversation, and someone you meet there might be able to introduce you to others later. Don’t be afraid to go up to the speakers after their presentations, too. They’ll be happy to answer any questions you have and it’s another way of making contact with someone more experienced.

Case Study

One freelance translator’s experience at her first conference

I think the thing I benefited from most is the re-energizing effect and the passion it’s instilled anew. This was only achieved by meeting so many wonderful colleagues, exchanging ideas, learning about new practices and being reminded of everything I love about my job. It’s a fantastic opportunity to learn from much more experienced people and to figure out how you want to take your career to the next stage, regardless of your current achievements or position.

I decided to go to the ITI Conference because it was putting a marker in the sand. I was coming up to my two-year anniversary of translating professionally and I wanted to ensure that I was investing in my career and developing the professional skills needed for the job. In a field where anyone can call themselves a translator, I wanted to take the appropriate steps to show that I am a professional. I’ve also realized that I learn best in a real-life, face-to-face setting so the jam-packed two days were more efficient for me than self-paced learning.

For anyone hesitating about whether to attend a conference, I would encourage you to take the plunge! Meeting other people in the profession and acquiring knowledge can only advance your career and make you feel part of the wider professional network. My one top tip would be to pace yourself in coffee/lunch breaks – I found one meaningful conversation with someone is far more useful than lots of quick introductions!

Rebecca works as a French and Spanish to English translator, focusing on tourism, retail and marketing texts. You can find her at rebeccaeldertranslation.com or as @translatorbex on Twitter.


4) Reach out before the conference


If you’re familiar with any of the speakers – you receive their newsletter, have seen their posts on social media, or have attended webinars they’ve presented, for example – send them an email before the conference starts to tell them that. This gives you a connection and a reason to then approach them at the conference. The same can also apply to other attendees if the conference website publishes a list of the other people who’ve registered.


5) Prepare for a tiring experience


Conference organizers have a short window to pack in as much as they can. Expect days to be long and full of activities! On top of that, you’ll be taking in a lot of new information, potentially speaking a different language, and travelling to get there and back again. Try to arrive well rested and allow a day when you get home to catch up on sleep.


6) Find accommodation near the conference venue


Most attendees will stay in or near the conference hotel. Price may be a consideration for you, but remember that you’ll have some early starts and long days. Staying somewhere that involves taking public transport may be something you’ll regret, particularly if you don’t know the city.

I like to use Booking.com to find places to stay when I travel, for a couple of reasons: 1) It has a map view, so you can make sure you’re booking somewhere close to the conference venue; 2) Its loyalty program rewards you with discounts, free breakfast, and room upgrades the more you book! Use this link to book and get 10% back on your first stay.


7) Make sure you have some business cards


Lots of people will give you their business cards. You’ll want to have something to give them in return – it will make you look more professional. If they can’t contact you later, they won’t be able to send work your way or refer clients to you.

I got my business cards from Moo and I was so impressed with the service I received. They arrived faster than expected and the quality was incredible. I now use Moo for everything I want printed with my logo, including Christmas cards and thank you cards for my clients. Get 25% off your first order when you use this link.


8) Take notes on who you meet


You’ll meet a lot of people over the course of the conference. By the end, you may find it difficult to remember who does what and to put names to faces. If you receive business cards from people, write a note on them to remind yourself of what they do.

Another strategy is to keep a list of people you meet with a few details about them. Update it at the end of each day. Wait longer and you might forget…


9) Allow an extra day to explore the city


If you arrange your travel so you only have time for the conference activities, you may find you never see anything of the host city. Many of us don’t find it easy to take time off very often. As you won’t be able to take on any paid work for a few days, why not make the most of it? You’re there already, after all.


10) Don’t be put off if you feel inexperienced


You might be overwhelmed by how much you still don’t know and still have to learn. Just remember that others are very supportive of anyone who wants to put in the work to improve. And by the time you come away, you’ll have already built up your experience, ready for the next conference.

Is there anything you’re wondering about attending your first conference? Ask me in the comments!

Registered for a conference?

Download your free conference preparation toolkit, including prompts to get you thinking about what to do while you’re there and planner sheets to complete and take with you to the event.

Get it here.

Posted by Susie in Freelancers, 2 comments

The Dos and Don’ts of Quoting for a Job

A Project Manager’s Tips on How to Improve Your Chances When Quoting

All freelancers find ourselves quoting for jobs on a regular basis. Sometimes we’re really interested in the project and other times we’re not, but how many of us have been on the other end of this relationship, responsible for recruiting freelancers for a project? Have you ever wondered what influences whether the client hires you or not?

As a freelance translation project manager, I regularly contact freelancers on behalf of direct clients and ask them to provide quotations. It can be eye-opening to discover what makes someone a preferred freelancer and what can be an immediate turn-off.


Covering the Basics


Let the client know quickly if you aren’t interested

If you know straight away that you aren’t interested in quoting for the project, respond to the client to tell them so. If they’ve addressed you personally in the email, that means they’ve looked you up and are waiting for a response. Let them know in good time if they need to keep looking for someone else.

Confirm receipt

If you don’t have time to go through the project information properly within a couple of hours of the email coming in, send a holding email to the client so they know you’ve received it. You can then take all the time you need to read the information later without pressure to respond urgently, subject to any deadline the client has given.

Read the project information thoroughly

Make sure you read everything you’ve been sent, including any accompanying materials. If you don’t understand what you’re being asked for and what the project will involve, ask.

Be clear and concise

Use headings or bullet points and don’t expect the client to click on links to other sources. If the client has to go hunting on your website to find out about your experience of similar projects, they most likely won’t bother. That’s especially true if others are providing that information directly via email.

Provide all the information you’re asked for

It sounds obvious, but it’s very off-putting if the client has to remind you to send the information they’ve asked for in the first place. If you’re quoting for a direct client (as opposed to an agency), they probably aren’t very familiar with how your industry works. They need to know a bit more about you and your experience to be confident in hiring you. Ignoring such requests shows a lack of attention to detail and implies that you aren’t interested enough in the project to spend some time on your quotation.

Give your price in the requested format

If you’re asked how much you would charge for working on a project, give a total price rather than an hourly rate. A direct client probably isn’t very interested in how you reached the figure – they just want to know how much it will cost. If the client asks how much you charge per unit of work (whether that’s per word, per video, per social media post, or anything else), provide your quotation in that format. Make it easy for them to hire you.

Quote realistic turnaround times

If you say you’ll be able to do more than is realistic in a given time frame, the client might think you don’t know what you’re doing or that the quality of your work will be poor.


Stand Out from the Crowd


Format your quotation in an attractive way

A professional quotation as a proposal in a separate document with all the requested information is far more memorable than a figure in the body of an email. A little colour can certainly go a long way when quoting, too.

Summarise the client’s needs

Include a summary of the client’s needs and your interpretation of what’s required when you send your quotation. It will show you’ve really thought about the project and what you could bring to it.

Phone the client with any questions

If you have any questions, use this as an opportunity to pick up the phone and call the client. Having actually spoken to you, they are much more likely to think of you when it’s decision time.

Be friendly and enthusiastic

Showing your personality will make you more memorable than freelancers who are very matter-of-fact in their emails. By showing you are approachable and easy to work with, you make the client more likely to champion you and choose your quotation over others.

Mention any upcoming commitments

If there might be an issue in the event that the project overruns or starts late, state that from the beginning. Bear in mind that some projects don’t start when they’re expected to. This really isn’t something the client wants to find out later when it’s a problem. They’ll therefore appreciate you taking the initiative at the quoting stage.

Case Study

Efficient, accurate and enthusiastic: one translator who got the job

I was project managing the translation of a short educational marketing text into multiple languages. I found several translators who I thought might be a good fit in the ITI Directory and emailed them with the source text and project brief.

Within an hour and a half, one translator had replied to tell me that she was interested in the project. She didn’t give her quotation then, but told me when I could expect to receive it.

Within the time frame she’d stated, she sent me her quotation as a PDF document. It included a little bit about herself and her experience, explaining how she approaches each project. She told me what tone of voice she would use and the values she would convey in the translated text, based on her understanding of the source text. Lastly, she asked for confirmation that this was what the client was looking for.

The translator was friendly and professional in all her emails and showed real enthusiasm about the project. I received 10 quotations for her language pair and hers was right in the middle of the price range. However, price was not the most important consideration, and she convinced me that she was the best candidate.


Some Things to Avoid


Don’t quote within minutes

Although it’s important to be prompt, don’t respond too quickly – unless you know you aren’t available to take the project on or you just want to let them know you’ve received their email. Quoting within seconds could imply to the client that you haven’t read what they’ve sent you.

Don’t be vague about turnaround times

If you really aren’t sure how long a job might take, give a broad range or be generous with the deadline you suggest. It’s not helpful to say you don’t know or it depends on other work. The client just wants to get an idea.

Don’t undersell yourself

Don’t be tempted to undersell yourself or your services because you think you’re more likely to be hired that way. Some clients will focus most on price, but many are looking for the most qualified person for the job. In my experience, mid-range quotations are often accepted. Those freelancers who provide the cheapest quotes are sometimes seen as inexperienced, so they won’t be taken on. And if you have relevant experience for the project you’re being offered, charge for it accordingly.

Don’t quote if you wouldn’t do a good job

If you’re simply not qualified for a project, don’t quote for it. In other words, read the information you’ve been sent and be honest about your abilities. For example, if the project brief asks for native speakers of a certain language with experience of a particular sector and you don’t fit the bill, don’t apply. The client will respect your honesty and may contact you about a project that’s a better fit in the future.

Don’t pester the client for an answer

If you don’t hear from the client, resist the temptation to keep chasing them. If you haven’t heard anything by the date you were told you would, by all means email or phone to confirm that there’s no news. But if they say they need more time or there’s been a delay, leave it at that. It may be tempting to keep chasing, but the client may be waiting for a decision from someone else. Receiving prompts from you every few days will just annoy them. They will be in touch when they know more; if you never hear anything, then you haven’t been hired. Repeatedly chasing the job may make you come across as desperate.


Keep It Professional


Be professional and friendly in all communication. If you don’t agree with something the client says, take a breath, step away from your computer and respond once you’ve calmed down. Of course, simply tell them you aren’t interested in working on the project if it’s a major issue. But if it’s something minor, find a way to convey your difference of opinion without being offensive. The PM probably didn’t mean to offend, and an aggressive response from you will make them less likely to hire you. And most of all, don’t complain about other freelancers or rates of pay in your industry. Whatever your views, this really isn’t the time or place for that.

Do you have any tips for quoting that I haven’t mentioned here? Let me know in the comments!

Posted by Susie in Freelancers, 2 comments