Co-Founder and CEO of Joust— the nation’s first, all-inclusive banking app for freelancers and the self-employed.
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Every skilled artisan has a set of tools. Today’s digital artisans, or freelancers, deal with virtual tools. Graphic designers have prized folders full of their favorite fonts. Project managers reach for their trusted spreadsheet templates. Marketers swear by social media scheduling tools like Sprout Social and CoSchedule.
Digital systems and software power the daily work of freelancers, especially when a deadline is looming. When a freelancer feels the pressure of a due date, their trusted arsenal of tools is crucial.
Time And Tools: Precious Assets For The Freelancer
For the full-time freelancer, the phrase “time is money” is even more compelling. Independent consultants are often acutely aware of tasks that waste time because they know when they’re not working, they’re not earning. Having tools to relieve the administrative work of freelancing is not just a convenience.
Freelancers must continually protect and optimize their time so they can make as much money per day as possible. That’s why tools, templates and software are a nonnegotiable part of any consultant’s workflow.
Financial Systems For Freelancers: A Blind Spot
For many freelancers, the process of selecting the right software to enhance their work is easy. Designers instinctively know that Adobe Photoshop and Illustrator are necessary and well worth the investment. Writers don’t hesitate to spend money on advanced grammar and spellchecking tools like Grammarly. However, a consistent blind spot for freelancers is investing in financial tools to ensure they get paid on time.
It’s common for consultants to devote all their effort to the work, which is an important and admirable trait. However, this means by the time a project is wrapped up, a freelancer has not defined a clear process to get paid. This is when freelancers can find themselves with long-overdue invoices and scrambling for cash flow.
A common scenario for independent consultants is to cobble together their financial processes, starting with sending an individual invoice using a spreadsheet or other template. But then a freelancer needs to remember to update another spreadsheet to indicate they’re collecting cash and contributing to yearly financial projections. And don’t forget about taxes. Consultants also have to pull out another tool to keep track of taxes so they don’t overspend what’s just been earned. This is why it’s important to pull all of your financial information into one place.
Tips When Choosing Freelance Financial Software
Now that we’ve established why systems and tools are essential to the freelance lifestyle, and why financial software is just as important, let’s discuss how to choose the right fit.
• Find the best product size and features for you. Recalling the earlier point about how time is money for the independent consultant, choosing a multitool system for your freelance finances is the best bet. When you’re a freelancer, you don’t necessarily need enterprise-level tools to manage your client load. While your work is mighty, your client load is lean compared to a large corporation. So look for a tool that is made for your size.
I recommend identifying tools that can manage the three aspects of freelance finance mentioned above: invoicing, tracking and taxes. Avoid tools that do not offer the full lineup of features you want because those will leave you needing another tool.
• Focus on integration. Today, through advances in application development, almost every piece of software can be integrated with another. So when you select a financial software for your freelance business, identify tools that can integrate with your existing banking institutions. And if you need to set up a dedicated account for your consulting business, choose software that also has the option to create FDIC-insured accounts.
• Make sure you can access all necessary data. Finally, I recommend you choose an all-in-one system that gives you a clear view of your full freelancing financial picture. From account balances to outstanding invoices to cash flows, this information will be vital as you grow your business. Plus, when tax time comes around, having access to your data will save you hours of time. Having the ability to set financial goals is also a feature to look for, because it will keep you focused even when your projects ebb and flow throughout the year.
Bottom Line: Make Sure Your Financial Tool Meets Your Needs
Today, with the explosion of freelancing, there are now many tools and systems available to meet the specific needs of independent workers. There is no reason to lose valuable time every week on piecing together the multiple financial steps of a freelance business manually.
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