Tag Archives: money

How to earn more money in your freelance editing business

How can editors earn more money in their freelance editing business? Carla DeSantis discusses the advice presented by Malini Devadas at a recent Toronto CIEP local group meeting:

    • Common mistakes when setting rates
    • Mindset and strategy
    • Marketing your freelance editing business

One of the benefits of being a CIEP member is the option to participate in local group meetings – getting to know other local editors, sharing information and making collegial connections. As the global pandemic forced groups to meet online, one advantage for the Toronto CIEP local group has been the ability not only to include Canadian editors outside of Toronto, but also to host guest speakers from around the world at these local gatherings.

In January 2022, Toronto CIEP local group coordinator Janet MacMillan invited Malini Devadas, based in Australia, to speak to our group on how to earn more money in our freelance editing businesses. Malini Devadas coaches editors and academic writers; through her business Edit Boost she helps editors to find more clients and earn more money.

Common mistakes when setting rates

Malini began the Toronto CIEP session by outlining four common mistakes that editors make when thinking about their rates:

  1. Worrying about what others charge
  2. Assuming that you know what clients will pay, without basing that assumption on data
  3. Devaluing your own time and skills
  4. Underestimating how long a job will take, which could lead to overestimating earnings and underquoting.

Mindset and strategy

In order to counter these common mistakes that editors can make in their businesses, Malini suggested adopting the following mindset and strategy:

1. Be confident in your ability to help people

How do you help your target client? When content marketing, talk about the issues that are of interest to your clients, not necessarily to other editors. What are your clients worrying about? According to Malini, it most likely is not simply punctuation and word choice. Show your clients that you can solve their problems for them. Since Malini also coaches academic and scholarly authors, she emphasised the need to normalise the idea of academics being edited.

2. Realise that you cannot help everyone who contacts you

As an editor, you may be limited by your schedule, what you need to earn, and your expertise. It is important to determine when you do not have the subject expertise necessary for a project and to perhaps pass it on to a suitable colleague. If a client is not able to pay what you need to earn in order to properly complete a job, it is okay to say no. Conversely, if you do not really want the job or already have too much work on your plate, you can charge more.

3. You are allowed to earn whatever you want to earn

Frequently, editors figure out what this amount is by working backwards from what their expenses are. It is important to take into consideration any specialised skills or knowledge that you may have, professional designations or how long you have been an editor. While it is easy to assume that certain disciplines (such as academia) may pose an unspoken limit on acceptable rates, Malini suggested that editors should not generalise about a discipline’s ability to pay, as sources of revenue may exist, despite your assumptions.

4. Life balance is a necessity, not a luxury

Everyone needs sleep and rest, even (or especially) editors! It is important for freelance editors to adopt a mindset that allows them to plan for life balance within their work schedule.

5. Market your business to attract the people who value what you do

If you focus your message on your ideal clients, you will automatically repel the clients who are not right for you. And remember, you do not necessarily need a lot of clients per year, just the right number of key clients to keep you busy for the time that you wish to be working (this could work out to, for example, 12 clients a year, if your average project lasts a month – fewer if you factor in vacation time). If you focus on marketing to the right people, you will get more inquiries from those potential clients who have the budget to pay your desired rates. If you can increase the number of inquiries coming in, you may then be able to earn more money by working fewer hours (which leads to #4 above). And remember #2 above: you do not have to take every job.

Man relaxing on some grass

Marketing your freelance editing business

So, what should freelance editors’ marketing strategy include in order to increase inquiries and, consequently, their ability to raise rates? Malini suggested using some of the following sources:

  • Contacts and connections. Let your existing contacts know that you are offering editorial services. If your target clients are academic writers, for example, consider offering writing or publishing workshops at universities (which may come with some compensation); such speaking engagements will give you good exposure. If you wish to work with graduate students, contact the departmental person who coordinates graduate students or use one of your contacts for an introduction.
  • Social media. Find out where your ideal clients hang out on social media platforms: Twitter, Instagram, Facebook, LinkedIn? In the case of academics, Twitter seems to be the preferred platform for engagement. Once you determine where your clients engage, work to develop relationships with people who can lead you to contacts. For example, consider whether you are targeting professors directly, publishers or managing editors. If you are offering workshops, remember that you need to sell your services to the university and departmental administrators, not directly to students.
  • Email marketing. Once you have provided content on social media that will get your ideal clients’ attention and people become familiar with you through those channels, consider moving these connections to email marketing. In this model, you will be providing content via email directly to the inboxes of people who have already decided that you add value.
  • Writing blog posts intended for your ideal clients (not for other editors) can also be a useful tool for driving new clients to your website. Hosting your material on your own website creates evergreen content that you can continue to share on social media. Once the blog post drives traffic to your website, you should have a call to action at the end of every blog post, which will encourage the potential client either to join your email list or to contact you.

The key, however, is to use whatever platform you are comfortable with, as long as you do some form of marketing.

I am grateful that the Toronto CIEP group provided a forum for our local group to connect with Malini at our meeting. The international editing community is lucky to have someone like Malini as a resource to constantly encourage us to value our skills, services and time. I have taken many of Malini’s suggestions into account over the past several years and have seen my business and income grow as a result. It is easy for freelance editors – frequently working in isolation – to undervalue themselves without cause. Malini’s main message, which is one that all freelance editors should embrace, is that editors running their own businesses offer significant value that should be properly compensated. Confidence to advocate for ourselves is key.

About Carla DeSantis

Carla DeSantis headshot

Carla DeSantis is an editor, indexer and translator based in Toronto, Canada. She specialises in scholarly humanities and social sciences, especially multilingual texts, and is an Advanced Professional Member of the CIEP. Carla has published on medieval Latin topics and is the author of the blog Parchment to PDF.

You can also find her on Twitter and Facebook.

 

About the CIEP

The Chartered Institute of Editing and Proofreading (CIEP) is a non-profit body promoting excellence in English language editing. We set and demonstrate editorial standards, and we are a community, training hub and support network for editorial professionals – the people who work to make text accurate, clear and fit for purpose.

Find out more about:

 

Photo credits: money by nattanan23, man on grass by Pexels, both on Pixabay.

Posted by Harriet Power, CIEP information commissioning editor.

The views expressed here do not necessarily reflect those of the CIEP.

Putting pensions in perspective for editors

It can be hard to know where to start with pensions, especially if you don’t have an employer to make some of the decisions for you. John Firth takes us through some pension essentials.

Pensions are a fairly simple idea (saving for the future) surrounded by baffling T&Cs. You don’t need to learn the detail so long as you clearly separate:

  • short-term needs and long-term saving
  • risk you can live with and risk to protect against
  • costs and benefits (protection costs but provides a benefit)
  • what advisers can offer and what you must do yourself.

I say a little about growth over time. Finally, when you want to draw on your savings you have options.

Most of this article comes down to ‘what do you want?’, ‘that all depends’ and ‘don’t let the perfect be the enemy of the good’: rather like editing.

Saving is Good, and we Ought to Do It, but first, we must put food on the table and then some bills we must pay because, if we don’t, we could lose our home. Not everybody can save.

This article is focused on the UK; pension options and legislation will be different in other countries.

Short term and long term

If you can manage to put money aside, first plan for the short term (today, tomorrow, next week). The best way is to put money aside regularly (out of every invoice paid, say), but a good second-best is to put something aside today, no matter how small. Doing nothing till you can afford to save regularly is a bad idea: rainy days come, whether you’re ready or not.

That money needs to be somewhere easily accessible. Find a bank deposit or building society account paying some interest; some people keep a cushion in such an account, and the rest in vehicles that earn a bit more, but can’t be drawn on so easily: different kinds of ISA, say. How many balls are you happy to juggle at once?

The National Insurance pension gets a lot of undeserved criticism. You would struggle to live on your state pension alone, but it’s the cheapest way to make a real difference to your standard of living in retirement, because

  • it’s guaranteed, no matter what the markets do between now and when you retire, and
  • it’s inflation-proofed.

If there’s a gap in your NI record you can pay voluntary contributions to fill it (check at gov.uk/check-state-pension). I think doing that is more important than making private pension savings.

So, you’ve planned for the short term and made sure you’ll get the full state pension. Now you can start to think about the long term. Pensions offer tax relief on what you put in (the government pays roughly 20% of your contributions to your pension provider, more if you pay higher-rate tax); also, tax breaks on the interest or investment growth you earn. But once you are in a pension, it is difficult and expensive to pull your money out until you retire: so think about whether you can afford to lock money away.

What’s next?

If you can afford a private pension, think about risk. Would it worry you if your pot’s value went down this year? Decide your ‘risk appetite’, on a scale from 1 (‘it would keep me up at night’) to 10 (‘not at all’). What about timing? While you’re younger you might be happy to wait out a slump; however, you probably want to protect your savings if you plan to retire next year, and after you’ve started to live on them. A good adviser will suggest when one investment approach is likely to suit you better than another, and many fund managers offer investment switching options. Some packaged products offer ‘lifestyling’ (higher-risk investments when you’re young; safer ones after 50 or 55): the government’s NEST scheme, for example.

If a slump comes, don’t stop saving! If you think the market’s overvalued, don’t stop saving! The times you bought when investments were cheap will compensate for the times when you had to pay more for them. This ‘pound-cost averaging’ will save you money; moreover, would you be able to spot ‘the right moment to invest’? Consistently, over 20 or 30 years?

Next, when could you retire? If your family all live to be 100, you need to save for as long as possible; if your genes are not so kind, you might want to retire sooner. It all depends …

Hidden and visible costs

Remember risk? Investment guarantees are often provided by ‘smoothing’ returns: the investment manager holds on to some growth in good times, to protect the fund in bad times. You will pay something for this protection, but that cost is hidden.

Index or ‘tracker’ funds aim to ‘track’ a particular investment index, more or less (some funds ‘track’ closely, others within a band above and below the index). These offer some protection – you never get significantly less than the market average – at some cost – you never get significantly more, either.

You could invest ‘actively’, in stocks, shares and other things that can be valued. These go up and down, and your fund manager tries to limit risk by spreading across different types of investment. There are many kinds of specialised fund, including ‘ethical’ funds. Active investment managers usually state costs clearly: often they make separate charges for managing the fund and for new investments, and specialised funds may charge more.

You could do all the investment yourself: many providers market ‘self-investment personal pensions’ (SIPPs).

It’s good to know what you’re paying, but don’t let the tail wag the dog. If ‘active’ investments would keep you awake at night, they probably aren’t right for you; simply accept that you may have to pay a bit more for a safer approach.

Advisers

Advisers charge for their services, some by billing you, some by collecting from your fund’s manager. A good adviser will help you make all the decisions we’ve talked about, tell you whether you’re on track or need to pay more (in an annual report) and help you when you retire. You can expect high costs when everything’s being set up and when you start to draw your benefits, and lower costs in between. Some advisers offer ‘smoothed’ charges, which will probably cost more overall (because they gave you credit during the setting-up, and anticipate costs when you retire).

Most of us should find a good adviser and trust them, but ask lots of questions. The Financial Conduct Authority offers guidance on finding advisers and what to ask (fca.org.uk/consumers/finding-adviser), and a register that you can search for firms qualified to offer advice on pensions (register.fca.org.uk/s/); Unbiased.co.uk is also quite good. Ask friends and colleagues who they trust, and who they don’t – and why.

Doing the maths

Recently, you might have earned 30% in some years, and lost 15% in bad ones. Over time, the good and bad years average out. What matters is outpacing inflation. If your pot grows (on average) by 7% while inflation (on average) is 2%, you’re earning 5% in real terms (7 – 2 = 5). But future charges are probably going to average somewhere between 1% and 2% a year, so your net return may be 3% or 4%. A simple spreadsheet model focusing on the net return is a good way to work out how your savings might grow in real terms.

You should be able to earn a net 4% a year over shortish periods (five or ten years), but there will be bad years and could be bad decades (remember the 1970s?). Over longer periods you’re safer assuming low net returns (2% a year, say). You won’t mind if you do better than budgeted; although, budgeting for 4% and actually getting 2% would mean a big shortfall.

Drawing your savings

Retirement is more flexible than it used to be. You can start to draw benefits from 55 (that will shortly increase to 57), or you can wait: there is no upper age limit. You can even draw some benefits and carry on contributing, but then a tighter ‘annual allowance’ will limit what you can contribute.

Up to one-quarter of your pot can be drawn in cash, tax-free; in stages, if you like (the one-quarter limit applies to whatever is left, so if your pot grows, so will the cash you can draw tax-free).

You can draw the remaining three-quarters in cash, and if your pot is very small, this would be tax-free; however, above this ‘triviality’ limit, HMRC charges a special tax rate to claw back the tax relief you received.

So, most people will use that three-quarters to provide an income, which will be subject to income tax. If you make the necessary arrangements before you retire, you won’t need to buy an annuity with this money: you could leave it invested and ‘draw it down’ (monthly or whenever). Annuities (insurance policies that pay a guaranteed income for a guaranteed period – usually, the rest of your life) don’t deserve their bad reputation. While interest rates are low, and because many of us are living longer, they are expensive in our 60s; but they can be good value when we’re older, or if our health is bad (some insurers offer special rates for particular medical conditions). An option to consider is buying an annuity at (say) 75, to guarantee (say) half the income you want to draw, and continuing to draw down from your remaining pot.

I’ve just described what the law allows. However, your plan’s documents might contain tighter terms than this: ask your financial adviser. Don’t ask me: I’m not FCA-registered.

About John Firth

Long before he became an editor, John Firth worked in pensions. He suggests we need to see savings as different pots for different purposes.

 

 

About the CIEP

The Chartered Institute of Editing and Proofreading (CIEP) is a non-profit body promoting excellence in English language editing. We set and demonstrate editorial standards, and we are a community, training hub and support network for editorial professionals – the people who work to make text accurate, clear and fit for purpose.

Find out more about:

 

Photo credits: Old Man of Storr by Matt Thornhill; calculator by recha oktaviani, both
on Unsplash.

Posted by Abi Saffrey, CIEP blog coordinator.

The views expressed here do not necessarily reflect those of the CIEP.

 

Uncovering the value of your work

By John Niland

In a recent conversation, a copyeditor posed the following question: How can I justify a higher rate, when I’m ‘just’ being asked to review a couple of thousand words of text?

I hear a similar question nearly every week, from accountants, lawyers, web designers, video producers, trainers … all professionals who are constantly being asked to ‘just’ do something. Indeed, I sometimes wonder if certain clients use the word ‘just’ to devalue a job, even before a professional ever gets to quote for it.

Nevertheless, I had to issue a gentle challenge to my copyeditor friend. It is apparent to me that she is already doing more to devalue her work than her client is. Can you see how?

You may wish to take a moment to reflect back before reading on. What’s the problem with the way that she is looking at value?

Context

Value is all about context, as the following story illustrates. A father once said to his son, ‘You graduated with honours. As a reward, here is a car I acquired many years ago. It is now several years old. But before I give it to you, take it to the used-car dealership and tell them I want to sell it and see how much they offer you.’ The son went to the used-car place, returned to his father and said, ‘They offered me £1,000 because it looks rather old.’ The father said, ‘Take it to the pawn shop.’ The son went to the pawn shop, returned to his father and said, ‘The pawn shop only offered £100 because it is such an old car.’ The father asked his son to go to a car club and show them the car. The son took the car to the club, returned and told the father, ‘Some people in the club offered £50,000 for it since it’s a Nissan Skyline R34, an iconic car and sought after by many.’

In the usual telling of the story, the father then lectures his son: ‘The right place values you the right way. If you are not valued, do not be angry, it means you are in the wrong place. Those who know your value are those who appreciate you. Never stay in a place where no one sees your value.’

Extrinsic value

So far, so good. However, there is a more fundamental point to this story: that value is extrinsic (ie based on context), rather than intrinsic (ie based on content). It’s not the condition of the metal that defines the value of the car, any more than the quantity of text defines the value of the copyediting job. It’s not the age of the car, any more than it’s the age of the copyeditor. Nor is it even the mileage of the car, any more than it’s the experience of the copyeditor.

The copyeditor is looking in the wrong place to find her professional value. As professionals, we will never find our full value in the content of our work: it’s the context that makes our work valuable. Needless to say, this distinction often produces howls of protest from purist practitioners. ‘What! No! It’s the quality of my writing / design / coaching etc that’s the key to my value!’ Well … not really. Most clients see quality as fitness to purpose and the value of that purpose lies squarely in the client’s world (context) … not in your content. No matter how good your content is.

Let’s walk through another illustration. Two web designers draft identical webpages: same text, same images, same design, same call-to-actions. One of those pages sits on a busy site, on a ‘crossroads’ often visited because of links from partners and associates. The other page is part of a standalone website, rarely visited, with no links. Which page has the most value? Which page would you spend most money to enhance?

Not content

Value depends on context, not content. When I work with my professional clients to fully master this distinction, it’s often quite liberating. They become much more fluent in the issues of their chosen client world; hence more compelling in first meetings. Their time-management improves – often quite dramatically – as they align their hours with the value added by their work. Over the course of a few months, they often learn to double and triple their fees, because they are no longer competing with generalists and instead can point to the true benefits of their unique value-centred approach. Younger professionals learn that they don’t need to first amass years of experience, but can differentiate themselves early on in their career, simply by becoming masters of context, not content.

There are many practical skills to learn here. Let’s look at some opening questions that our copyeditor friend might ask, to focus on the context (rather than the content) of her work. Here are some examples:

  • How will the client judge the success of this project?
  • Who will be making that assessment? When and how?
  • What impact could this project have on sales/engagement/signups, etc?
  • What’s their experience/history so far? What happened last time they tried to engage someone like me?
  • What other initiatives are going on that we should take into account?

You can quickly craft some of your own questions, to fit your style and market. As a rule of thumb, ask yourself if your questions are about them and their world, or about you and the work you are being asked to do. If it’s the former, you are well on your way to uncovering context, wherein lies the real value of your work.

Of course, there are challenges along the way. There are clients who block professionals from context. There are agents and middlemen who could not care less. There are last-minute clients who constantly suffer from hurry-sickness and just don’t have time for a value conversation. This is when your own self-worth is vital. Whatever happens, you know you don’t belong in a place where people don’t want to see real value. So find better clients and move on.

© John Niland, August 2020

John Niland runs regular webinars for professionals to improve the value of their work. See www.selfworthacademy.com/webinars/ for the current schedule. John’s book ‘The Self-Worth Safari’ is available on Amazon.

 


The CIEP’s Pricing a Project guide looks at preparing quotations for editorial work.


Photo credits: Plant in coins – Micheile Henderson; Nissan Skyline – Ondrej Trnak, both on Unsplash

Proofread by Emma Easy, Intermediate Member.
Posted by Abi Saffrey, CIEP blog coordinator.

The views expressed here do not necessarily reflect those of the CIEP.

Know me, pay me

By Robin Black

Working in the shadows of nearly every project, editors could do with a bit more public understanding. ‘We don’t have much of a budget,’ invokes the client, though I wonder about companies that don’t have the budget to be good. Who sets a budget to be bad?

Show me a copy-editor and I’ll show you a living combination of robust general knowledge, an eye for detail that won’t quit, and a flair for the metaphysical. (You try rearranging the words so readers are visibly moved by the end.) Do you care that your editor detects that a particular adjective can make two appearances in a single chapter but not three or four? Either way, you should absorb the manuscript, whether it’s a white paper, a website or a manual, without tripping over such infelicities. In that sense, you should forget about us.

But not so much that we’re taken for granted when it comes time to employ our services. I’m uncomfortable about driving home the point, however: surely there’s scarcely a métier out there whose adherents don’t feel misunderstood and underappreciated from time to time? Lawyers, for example, lament that they could do more to help if only they were consulted before things go haywire. The stewards of the Southwark Household Reuse and Recycling Centre, where a maze of conveyor belts criss-cross in improbable fashion, aren’t asking you to rinse out your discarded materials for their health; it gums up the system, slowing down the work of nearly everyone on the premises. And in the face of a public that doesn’t listen, the distinct burdens of climate scientists weigh heavily: armed as they are with the science that impinges on you and you and you, they can scarcely daydream about escaping to New Zealand any more. (A desperately hungry populace tends not to care overly about property rights.)

It is with gentle misgivings about self-centredness, then, that I invite you to turn your attention expressly to editors, for whom the information imbalance translates into high demands for humble pay. I self-select out of some of the worst of it by rejecting low-paid jobs and seeking out the clients who feel as I do about a job really well done. And while quality is its own reward, equally, someone out there wants to pay for that quality, and my idealistic mind aims to keep finding them.

But then my sister called. Her website needed some tidying up, and she’s a pragmatist: ‘Let’s just do what we can in the time we’re given and get this crap out the door.’ So much for my idealistic mind, I thought. I demurred, and she rolled her eyes and politely dropped it.

Should I have just sidestepped my standards and been helpful? For the answer, I look to the guiding principle of 28th annual SfEP conference: ‘It depends.’ When newbies jump on the forum to ask for feedback on their websites, I may steel myself ahead of reading those threads because the general positivity of our members, which I laud and cherish, means the critiques veer towards the reliably panegyric instead of the helpfully critical.

I’m quite unsure whether that’s a bad thing, however, though I admit to a little frustration, and indirectly it has to do with money.

Ugh, money. I’m one of those people who is uncomfortable talking about it, likely to my own detriment, so let’s get this over with: the choice I make not to list my rates on my website – I never discuss fees until the client expresses an interest in hiring me – maps onto the editor and business person that I am. My approach is to psychologically leverage clients with my chat, my bearing and my materials, only to strike with a generous payment suggestion once the iron is hot. But such wiles could go awry in the absence of the rest of me – which is to say that my approach comes off naturally and therefore honestly from me, but grafting it onto you is iffy.

For me to insist that you should never publish your fees on your website is glib, and besides, look at all those lovely, experienced editors telling you something different. I throw up my hands in friendly defeat, satisfied that everyone is acting in good faith as they post disparate advice, and I stay quiet.

And yet. There is an assumption among our members, which I share, that we concentrate on doing a very good job while employers exploit us with low fees and outsized projects at capped rates. Leaving aside my contention that no one should be taking lower than the CIEP’s suggested minimum rates (Glib? But I stand by it), I put to you this question: why would a client pay you professional rates when you’ve got an amateur public face? When clients move forward with unedited or poorly edited materials, as is their wont, how long can you stay indignant when your own website is untouched by proper design and typography?

We prize words over images, but our Venn diagrams may or may not overlap with those of potential clients, so see it through their eyes, and subdue your inclination to tell them everything! that! you! do! well! As editors toil in the shadows and the public neglects to recognise the metaphysical power we wield boosting human connection through communication, nearly everyone appreciates a professionally rendered website. It makes budget holders relax.

Allow me to be mercenary for another moment: if you want to be paid properly as a professional editor, by clients with robust budgets, then hire a professional to craft your website. And for Heaven’s sake don’t talk them down in price if you want to be extended the same courtesy.

Look, the things I’m doing wrong with my own sole proprietorship are legion. In business, you can’t do it all; there’s always something more you should be doing. And that’s not advice; I’m trying to tell you it’s a trap. In his wisdom, Oliver Burkeman warns us that ‘getting it all done is an illusion. You’ll never get to the summit of that mountain because the climb goes on forever’. Consider the editors who do quite well, thank you, with no website at all or an online offering barely a step up from GeoCities chic.

Being a capable editor – doing the work well – is more important in my mind than having a professional website anyway. I view with mistrust careers that coast on marketing and talking instead of execution and elbow grease, but I would say that, wouldn’t I? Execution and elbow grease is what I know how to do! Persuading people to buy things they don’t initially want or fundamentally need embarrasses me, which means that my own self-marketing is lacklustre.
As for my sister’s website, months later I relented, agreeing to help if and only if we could start small, rendering good text and better design choices with a one-page website that tacitly communicates to visitors that they’ve landed where quality matters.

We should tell her story, I insisted, bringing her role out of the shadows … um, relaying the underlying, human aspects of her profession for clients … or something like that. Wait: What is it you do again, Stephanie?

Pfft. There goes the public again, scarcely taking the time to understand.

 

A financier and editor-who-does-it-for-love, Robin Black believes that no profession or livelihood will escape without integrating the climate crisis into its day-to-day, and he finds writing about himself even more embarrassing in an era of existential threat. Bravery is called for, however, so he manages it here.

 


Photo credits: For hire Clem Onojeghuo; All we have is words – Alexandra, both on Unsplash

Proofread by Andrew Macdonald Powney, Entry-Level Member.
Posted by Abi Saffrey, CIEP blog coordinator.

The views expressed here do not necessarily reflect those of the CIEP.

Wise owls: managing money

It’s coming up to the end of the UK tax year (5 April) – the CIEP’s wise owls have turned their thoughts to keeping track of income and outgoings.

Liz Jones

Here are some things I’ve learned about managing money in 12 years of freelancing:

  • Tax is a potential killer. I’m happy and proud to pay tax, but it’s one of the things I’ve found most challenging to manage in terms of cash flow, especially in years when I’ve taken a few weeks’ ‘maternity leave’. It’s really important to set aside more than you think you’ll need: if your earnings fluctuate, so will your tax bills. I’ve found paying an accountant to be a worthwhile cost to help me get my tax calculations right and understand how I can make the most of allowances.
  • It’s essential to get into a position where you’re not depending on a particular payment being made on time in order to pay vital bills such as the rent or mortgage. Even with the best clients, timely payment is not 100% reliable.
  • I never justify charging clients a high rate by citing my circumstances. As it happens, mine is the main income for my family, but that’s irrelevant to them. They’re paying for my work, not to support my lifestyle.
  • I use FreeAgent to manage my invoicing, and my accountant takes the information directly from this to complete my tax return. It’s not free but it’s saved me a lot of time over the past few years.
  • I chase invoices as soon as they go overdue. After once losing nearly £2,000 on an unpaid invoice when a client went into administration, I also invoice regularly in smaller stage payments for large jobs, to mitigate the risk of a client going bust.

Louise BolotinLouise Bolotin

My nickname is The Spreadsheet Queen! I use spreadsheets for everything, although I’m barely proficient in Excel. No matter, as you don’t need to be. I created a spreadsheet to track my invoicing just by setting up a few columns with headings such as date, client, what the job was, PO number (if applicable), how much I billed, when I invoiced, when the money is due, etc. I have extra columns for notes and to tick off when my client has paid. I also have a spreadsheet for tracking client hours, with my per hour rate in a column. I bill some of my clients monthly, so I can tot up jobs on the tracking spreadsheet and transfer the billable sum to my invoicing one.

My outgoings are minimal – I’m mindful that expenses are tax-deductible (mostly). My biggest expenses are my CIEP fees (and conference, if I decide to go) and my trade union subs. Then there are costs for software, and, occasionally, stationery, plus fees for my accountant and PC fixer (an essential expense!). Again, I track all these on a spreadsheet – it’s useful to see how much I’m spending per year, including versus how much I’m making. I aim to limit expenses to 5% maximum of my turnover, but it’s usually below that.

I check my business bank account on my phone daily to see what’s gone in (or out). Yes, I have a separate business account – I find it easier to track income and expenses without having to trail through my supermarket shopping, Spotify subs and utility bills. It’s not possible to separate business and personal completely, but it’s about 99% foolproof. I set aside 20% of every invoice as it’s paid – it goes into a dedicated savings account for my tax bill after my accountant has filed my tax return. Setting that aside also stops me from thinking I have more disposable income than I actually have.

Hazel Bird

Managing money is about finding a system that suits your business model. For example, if you’re raising lots of low-value invoices, it might be worth paying for a system that raises, sends and tracks invoices for you, and integrates this data into an accounting package. I’ve seen CIEP members recommend the likes of Crunch, FreshBooks and QuickBooks for this purpose. I tend to raise fewer high-value invoices, so I use an Excel template (which I complete and convert to PDF) and do my tracking in Google Sheets. This lets me geek out with functions to create my own personalised reports. It also means I have no money-management-related expenses beyond the time I take.

It’s definitely not essential to have an accountant, especially if your finances are simple. But naturally this means keeping on top of current tax and accounting requirements, particularly if you’re registered for VAT or invoicing clients in jurisdictions outside the UK. Members often raise very helpful threads on these topics on the CIEP forums.

Finally, there’s a stereotype that freelancers never complete their tax returns until the week they’re due – and then discover we owe the government far more than we expected. I’ve always consciously avoided that approach, because it’s important to me to know my exact tax liability and ensure my cash flow will cover it. To make this as painless as possible, I tend to be one of those insufferable people whose accounts are always up to date. This is inevitably a bit tedious, but it shouldn’t be too tedious. Your system should slot into your work as seamlessly as possible. Money management should serve our businesses, not the other way around.

Nik ProwseNik Prowse

A wise man – a mentor from my early days as a freelancer – once said to me: ‘Put aside your tax money before you spend it.’ He also advised separate bank accounts. So I have a bank account into which all of my business income goes, and as soon as I have a receipt I put a percentage of it into a savings account to cover tax and National Insurance. I set the percentage slightly over what my tax will be, so that I save something each year just by hiving off my tax money.

I don’t use anything other than Microsoft Excel to manage my business income. I have a spreadsheet with columns for date, project name, invoice number, ingoings and outgoings, with a reminders column for payments due for bills and the mortgage. I have separate sheets for the money put aside for tax, business expenses and income from clients. That way, when my tax return is due my business income and outgoings are all present in one handy file.

These two systems have always allowed me to know how much I have, and to be certain that I can’t dip into crucial money that will need to be paid to HMRC.

Sue BrowningSue Browning

My key advice is to do things as you go rather than leaving them to pile up and need sorting out later. Sent an invoice? File it and record it on your income sheet. Renewed your CIEP subscription? File the invoice/receipt and record it on your expenses sheet. I give each invoice and expense a unique reference. Then each month, I download my business bank statement and reconcile it with the invoices issued, marking up each item on the statement with its reference number in my accounts. This reconciliation takes me less than half an hour each month. I do everything electronically, scanning paper receipts on the rare occasions I receive them. I also use a program called Cushion for scheduling, time-tracking and invoicing so my information is all in one place, but do what works for you.

I also put about 20% of my month’s income into a savings account earmarked for tax. This means I don’t dread the total when I submit my return. My accounts spreadsheet has a totals worksheet that collects the monthly figures and gives me an annual total. Come tax return time, I have only to refer to that sheet, knowing that all my invoices and receipts are in order, so my tax return takes me about half an hour. That’s when I am grateful to past me for taking a few minutes regularly to keep on top of things.

Sue LittlefordSue Littleford

Knowledge is a wonderful thing. First, know your money style. Are you disciplined? Does it trickle through your fingers? Track your invoices, and pounce on any that become overdue the first day they’re overdue. Don’t be shy. You’re in business, not pursuing a hobby. Be polite but firm, and repetitive – it works in most cases. Don’t be afraid you’re ‘nagging’ – you’ve done the work, so your client should pay up! Budget for your business and household expenses: work out what you want to spend on training, marketing, CIEP membership and conference attendance, materials, resources and overheads – and know when those become due.

Work out what you need to live on, likewise. Use that knowledge to help you set the hourly rate you want to earn. A simple spreadsheet of your invoices with a running total can be used to forecast your tax and National Insurance bill. According to your money style, either save enough from each paid invoice to pay the tax on that invoice or do your tax return as early as you can and set up a direct debit with HMRC to pay in monthly instalments (more like a PAYE scheme, and there’s no temptation to dip into your tax pot before you pay it to HMRC). With interest rates so low, the satisfaction of knowing you’re paying down that tax bill rather than saving the money and earning on it may balance out easily. Attend HMRC webinars on business expenses and filling in your tax return.


If you’re starting out on your freelance journey, the CIEP’s guide Going Solo covers the finance basics, including tax and record-keeping obligations.


Photo credit: owl – Dominik VO on Unsplash

Proofread by Victoria Hunt, Intermediate Member.
Posted by Abi Saffrey, CIEP blog coordinator.

The views expressed here do not necessarily reflect those of the CIEP.