If you’re broke as a writer and you’re wondering why, there are several common reasons. And actually, this post should be called “The Number Two Reason You’re Broke” because number one is almost always a failure to market your business. But aside from that, the number one reason you’re likely broke is because you spend money when you get it.
Let me explain.
A couple of months ago I had what, at the time, was a really awesome month at around $2,700. I didn’t have a whole lot of expenses out of that, so I had some fun. And then ended up in the red a month later.
This happens all the time. As writers, we’re pretty used to being broke – at least as new writers. Now you don’t have to stay in that state forever. The more you market, the more you’ll get a response. But in the meantime, when you have an exceptionally good month or you land a big job, do not spend what you make right away! Sit with the amount for awhile. Enjoy it. Let your excitement simmer down. And then make wise financial decisions.
The reason I know something about this subject is because I spent the first – oh – 7 months of my freelancing career essentially broke. So broke, in fact, that on my tax return – even after paying money for taxes – I actually got money back for not having made a lot. That’s sad.
Fortunately, things have improved, and I know that they will for you, as well, if you’re in the same situation. I feel that a lot of the reason freelance writers “fail” isn’t so much because they actually fail, but because they panic and give up, assuming their business hasn’t worked. Freelance writing – in case you haven’t figured it out – is NOT a get rich quick type of thing. It’s more like a “take a year figuring out your business and then you’ll be set” type of thing.
I’m nearing the end of my first year of freelance writing, and I’m finally starting to figure it out. Things are improving, I’m earning more, and I’m more comfortable with the ups and downs of freelance income. Diversifying my income streams, holding onto what I get until I have a good amount saved up, and minimizing distractions while I work have been among the most helpful things I’ve done. Having a solid marketing plan is another thing I know to be very important, and mine is finally taking shape and becoming effective.
So that’s my tip of the day for you. Do not, under any circumstances, go on a spending spree just because you had a good month. Always have 1-2 months of bills plus a little cushion saved – or at least available in your checking account – at all times. Being able to purchase something and being able to afford something are two different things. If you have $500 in your account and you really want that $100 item, you can purchase it, but you can’t afford it. If you have $5,000 in your account well, then, you’re probably okay as a one-off treat purchase.
Always assume that your next month will tank. Not in a self-fulfilling prophecy down on yourself kind of way. Just in an “expect the worst hope for the best” kind of way. If next month you had $0 coming in – a statistical improbability unless you literally don’t work – would you be able to at least pay your bills and eat? If not, don’t go spending what you don’t need to.
For more tips on mistakes to avoid as a new (or even a not-so-new) freelancer, check out my eBook “The Top 25 Mistakes New Freelance Writers Make (And How to Fix Them)” available for just $3 on the Kindle. (You can click on the picture for a link to the US marketplace. Here are the links for Canada, the UK, and Australia. I know it’s available in several other countries, too, so if you want the link for a particular country that isn’t here, let me know. 🙂 )
Hopefully these tips have helped you out. I’m working on my second eBook already – how to market your business using social media – which isn’t geared specifically to freelancers or writers, but applies just the same.
Until next time – happy writing!