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Thanks to fellow S&S reader, Sabrina, for today’s post. Check out these must-learn financial lessons for freelancers.

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Freelancers don’t always make great financial decisions, but it’s fundamental to your success as a freelancer to manage your money well. So let’s look at 3 ways to do that.

1. Budgeting

As a freelancer, you’ll likely have good months and bad months. Heck, even good days and bad days, depending on what you’re doing. Budgeting is key if you’re going to keep your finances in good condition and avoid worrying about the future.

You can use apps to help you budget, or simply do it yourself using a piece of paper and a pen. The important thing is you get your numbers right and you take into account things like bills, savings, and anything unsuspected that could crop up. The worst thing you can do as a freelancer is live pay-day to pay-day, with no money in the bank to help keep you afloat.

2. Cash Flow

Budgeting brings us on to our next point; cash flow. Cash flow is what’s going to keep your business going, even through the quiet months. This means you may need to pay yourself as little as possible to begin with while you build up an emergency fund. It could even mean taking a closer look at how you chase clients for payment, making sure it’s as effective as possible. Some clients will need more than one nudge to encourage them to pay, unfortunately.

You might consider turning to loans and credit cards to help, and sometimes this is ok. You can look at things like prosper loans reviews to make sure you’re doing the right thing and that you’re not going to end up in mountains of debt afterwards. Just be warned that it can be a slippery slope, and it’s best to ensure you have your own money saved to avoid issues down the line.

3. Goal Setting

As a freelancer, it’s up to you to think about your long-term goals. If you don’t consider your long-term goals, you’ll spend your money unnecessarily. Then have to continue living paycheck to paycheck. You need to be smart.

Making financial freedom your goal will mean you can work without having to panic if you have a bad month. It means you won’t have to work as much eventually. In fact, you may not need to work at all later in life. Look at passive income strategies and see what you can do alongside your freelancing gigs to build your financial freedom nest egg.

Make sure one of your goals is to save up an emergency fund, and then rather than plugging your spare cash into the fund forever, invest your money wisely.

These financial lessons are perfect for just about anybody who wants to become more financially savvy, but they are especially helpful to freelancers!