Getting paid is a crucial part of freelancing, but can be a stressful one. 70% of freelancers have reported having trouble when it came to being paid, according to a 2015 report by the Freelancers Union.
Whether you’re an experienced freelancer looking for a better payment tool, or a new freelancer looking for guidance on how to invoice, here are 5 simple tips to help improve your freelance finances.
1. Get paid like a local
There are many options out there for getting paid. It’s worth assessing how convenient each option is for you, and how much it will end up costing based on your circumstances.
PayPal is one of the better known methods, but it’s equally well known for its fees. Payoneer is a platform that is integrated into many freelancing services such as Fiverr and Upwork, but it charges fees to get paid for dollars and has other costs when it comes to withdrawing the money. Your bank is also an option for receiving payments but many charge a fee to receive international payments.
If your client is based abroad, TransferWise offers the best way to get paid. Its account gives you local bank details for over 30 countries, which means you can get paid like a local, fee-free. It also lets you hold a balance in over 40 currencies, and convert instantly between them at the real exchange rate so you don't lose out on currency conversion costs. You can manage all this in its app, and spend your money abroad with its debit Mastercard.
2. Write your invoice right
There are some basics that are essential, especially if you’re new to freelancing. Make sure you include your business name or full name, your contact information, the client’s, the date, the work completed, invoice number, and the amount due.
Record the work completed by itemizing each billable item separately. Don’t forget to include the options by which you accept payment and a date by which payment is due.
There are several tools, such as Wave and PayPal Invoicing, which provide invoice templates, to help you adhere to a clear and clean layout.
3. Invoice instantly
As soon as you've completed the work, issue an invoice. The way that invoices get processed can vary from company to company, and there can be a lengthy approval process, slowing your bill's progress to your bank account. The key here is consistency and speed.
If you submit your invoices slowly and allow a backlog to grow, it will become harder to keep on top of all your paperwork, and you risk being in need of funds if you’re not ensuring a regular flow of funds into your account.
4. Stay on top—and in touch
Make sure you have a means of tracking invoices due by different clients—be it a simple spreadsheet, or a tool such as Xero or Intuit Quickbooks, which also offer reminders for clients to fulfil payments.
The key here is to prevent payments from dragging on. Be proactive and communicative with your client. It can help to have a system planned in advance, so that you have a clear approach for how long you’ll wait before each follow-up reminder with your client, if your invoice is taking longer than expected to get paid.
5. Plan how you'll manage your income
There are an increasing number of financial tech firms which offer specialized services to make it easier for you to manage your money. Mint helps you manage your finances all in one place. It provides a view on all your bills, you can budget within its app, and you can also view your credit score. There are options for saving and investing, too, such as Wealthsimple, which helps you grow your savings over time.
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This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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