Cash Flow

Cash flow is a huge thing when you're freelancing. On paper, you could have promises from people that make you feel like you're doing great!

So someone agrees to pay you $6000 for their project. GREAT! Wonderful! You think to yourself, "oh that will cover rent for another 3 or 4 months!" But then I got to account for the fact I may not see that money till 3 or 4 months down the line till after the project is finished.

So what do I do in the meantime? Car insurance, rent, taxes coming up, accountant, business bills, rent.

With a regular salary job, you can kind of run lean sometimes. Perhaps you're down to just barely enough to get by but you always know you can ride it out till the next paycheck in a couple weeks. With freelance, there isn't that paycheck. You have to think ahead about what you need almost 3 or 4 months ahead of you. It's kind of the freaky part of working on your own.

So when people ask me... "are you doing good?". The answer is mixed. It's "OK" is what I say. It seems like I'm doing great. But if I'm not careful, things could get ugly.

The biggest mistake is thinking you're "rich" when you're not. Never assume money in the bank now, means there's enough there to spend frivously. If you think the amount in the bank account is "enough", try to save up at least double that amount to cover for unexpected things.

I'm going to have to run tight these next couple months. Who knows how much I'll owe in taxes come February. I'm a little scared, and a little stressed. Makes me kind of regret pulling the unemployment benefits a bit. That would have been a good safety net just in case.

Well, it's sink or swim at this point. Just gotta go balls to the wall to finish projects up and get those invoices out.

But just when I needed it most, I receive a card from my girl today. "I know you are working hard these days. I'm sending you this card for encouragement." Damn, how good is that? What an angel. ^__^