Freelance Tax and Financial Planning: What Will You Do Differently in 2018?

By Liz Alton, Contributor, on January 10, 2018

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With the arrival of 2018 comes a new year of freelance tax and financial planning opportunities and challenges. From beating back debt to landing high-paying repeat clients, the indys I connected with have big plans for the year ahead. Their focus is mostly on growth, and how better systems can power that growth and turn their efforts into long-term, sustainable careers. Here’s a closer look at what the freelancers I spoke with are most concerned about in the year ahead.

Get Back on Track With Retirement Savings

Amongst the indys I reached out to, the desire to get on target with retirement — or ramp up retirement savings — was a major trend. “We’re definitely trying to make up for the past couple years,” says Gabriela Bazan, a website designer and developer. “We’ve been playing catch up since our son was diagnosed with Lymphoma early last year. Lots of unexpected expenses — the ‘new normal,’ as we call it — have proven to be quite the distraction from our usual savings plan. But every new year brings a new promise and opportunity, so we’re hoping to get back on track.”

From automating retirement contributions to diversifying investment vehicles, there are a range of retirement considerations on the table for freelancers.

Increase Income to Meet New Goals

Freelance writer and researcher Cat Distasio is focused on increasing her income to achieve a variety of personal and professional goals. “My primary goal for 2018 is to flex my tech knowledge and parenting experience to expand my writing in niches that demonstrate my expertise and passions: the intersection of kids and technology,” she says. “It’s part of a two-fold goal to increase my overall income, as well as the level of personal satisfaction my work brings into my life.”

The desire to boost earnings and satisfaction is a major theme across the board for freelancers in the year ahead.

Stabilize Cash Flow and Enhance Savings

Stabilizing cash flow and growing a book of business were some of the number one concerns that came up for indys contemplating their tax and finance goals. As copyeditor and proofreader Barbra Harper says, “My biggest goal for 2018 is to land a few more anchor clients — the ones who have steady, ongoing work for anchor clients of their own. Once I have a few more of those nailed down, I’ll be in a better position to start looking toward a savings plan for the future.”

With more money coming in each month, indys can focus on goals they need to achieve.

Strengthen Expense Tracking and Business Administration

Alison Carville, an independent public relations practitioner and the owner of Carville Communications Consulting, has major growth plans for the year ahead. She’s focusing on streamlining her business finances by tracking her expenses, which will get increased attention in 2018. “For streamlining finances and tax purposes, I take note of monthly costs and any ‘extra’ costs near the end of the month and log them in an Excel document,” she says. “I track personal spending, income, donations and business expenses.”

Build Solid Processes

End-to-end business processes are also getting another look. “My top priority for 2018 that’ll [help me] achieve my final goals is to build out solid processes for my business,” says Chris Castillo, a freelance designer and marketing strategist that founded Propel Digital Media Solutions. “I’ve seen the impact that this can make not only to my bottom line, but to my cashflow. Solid business and project processes can allow you to scale, but also deliver consistent quality experiences for customers.”

Pay Off Debt

Another major theme for freelancers this year is paying off debt. “I recently graduated in May, and I’m freelancing to pay off my student loans that kick in at the end of the month,” says freelance social media manager Maddy Moloney. “I really want to pay off my debt in less than 10 years, so I’m trying to do what I can to make larger payments.”

Rob Swystun, a freelance writer, agrees: “I’m excited about paying off debt in 2018. I’ve been working at it for a while, and this should be the year when I get back to zero and can concentrate on saving, instead.”

With debt out of the way, it’s possible to save, invest in your business and funnel cash flow into your personal goals.

Outsource Tax Prep

Taxes remain an important part of the freelance finance puzzle. For Ken Roberts, a freelance marketer, 2018 is the year to simplify and invest in professional tax prep. “This year, I’m going to hire an accountant to do my taxes,” he says. “I’ve done everything myself until this point, but with the amount of businesses I’m involved with, it’s become too much to handle myself.”

Use Automation Tools to Streamline Finances

Personally, looking ahead to 2018, my biggest goal is automation. The underlying question I considered as I talked to other freelancers about growth and systems became: How can I use the tools available to me to better streamline invoicing, tax prep, savings, retirement and more? If a service or tool exists that helps me take a routine financial task off my plate, I’ll spend the time to take a closer look and set it up for my business.

In 2018, make sure you free up more time to do what you love, connect with more clients and ultimately develop the systems you need to help your business thrive. From freelance tax planning to business growth, there are a variety of critical areas that deserve your attention.

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