How can you effectively manage your finances as a self-employed worker?

One common mistake that others make when they start a business is that they spend a TON of money because: "It's a write off!" That may be true, but you're still paying for it! Keep the startup mindset where you need to carefully track and review your expenses regularly. Look at your subscription services: do you get value out of that software, or is it one that you can cancel?

As you level up, you should understand that thier are different measurements for ROi but th most important one for beginners to hit the ground running is "pay-back period".

One thing i found useful was to keep track of my business expenses, and separate them from personal, even to the smallest details such as treating clients to drinks. These should not be counted as your own. Then, it's also a good habit to separate your bank accounts, personal and business related.

Use a daily mobile app to track every single spending on the go! Something that allows you to see the monthly expenses on the top of the app easily.

Many self-employed people find themselves overwhelmed shortly into their business. Unlike a traditional 9-5 job with a salary, there are likely enough tasks that you "Could" be doing (marketing, following up with cold leads, writing that blog article, reconciling your budget) that entrepreneurs could likely work all the time. Make sure that you're blocking off time in your schedule for personal development, business strategy, and- maybe most importantly- rest!

In the world of being self-employed- there's no pension and Rolex coming after 30 years of service. You need to take retirement into your own hands and be proactive! Early on, opening an account such as a SEP IRA or Solo 401(k) can be a great way to start. Contributions can be flexible, which helps if cashflow is tight, and they allow you to contribute significantly more than a Traditional IRA. Even when cashflow is tight, make sure that you're not neglecting your own retirement savings on a consistent basis. The earlier you can start saving for retirement, the more you'll be able to experience the wonder of long therm compounding growth!

This is one area of your business that cheaper does not mean better. I once had a client come in that was proud of the fact that they were doing their own bookkeeping and taxes, saving a few thousand dollars a year. I referred them to an accounting firm that offered a free consultation, and they uncovered about $30,000 of annual tax savings that could be realized by making some changes. The same thing applies with legal help. Money spent on a good attorney to draft your engagement letters and sales agreements can save your entire business. Poorly drafted agreements (or none at all!) leave you- the business owner at a significant risk. Take the time up front and invest in a good attorney that is comfortable representing you!