{"id":6402,"date":"2019-11-06T09:38:33","date_gmt":"2019-11-06T09:38:33","guid":{"rendered":"https:\/\/everpress.com\/blog\/?p=6402"},"modified":"2022-09-20T16:14:55","modified_gmt":"2022-09-20T15:14:55","slug":"how-to-manage-your-money","status":"publish","type":"post","link":"https:\/\/everpress.com\/blog\/how-to-manage-your-money\/","title":{"rendered":"How To Manage Your Money"},"content":{"rendered":"

Managing your money is perhaps the scariest part of a career as a freelance creative. Unlike a full-time office job, where the cash rolls into your account on the same day each month, freelancers have to contend with lost invoices, late payments, and often a total lack of clarity about how much to charge. Even artists who have been working for themselves for years will confess to a certain element of making it up as they go along. But there are a few key things to bear in mind that can help you over the bumps in the road.<\/span><\/p>\n

\"Jay
Jay Som sleeve artwork designed by Mar\u00eda Medem<\/figcaption><\/figure>\n

GETTING ORGANISED<\/span><\/h4>\n

Knowing what you\u2019ve billed, when it should have been paid, and whether it has been paid is essential. Many artists work on several projects at a time, which means it\u2019s easy to lose track of invoices. Illustrator Mar\u00eda Medem says that being organised is the biggest challenge she\u2019s faced as a freelancer, but also the most useful one to overcome. \u201cI always write everything down,\u201d she told us. \u201cThe fee the client has to pay me and when they\u2019re going to pay me, the date when I\u2019ve got to do my taxes\u2026 and also being organised in the sense of saving all my tickets from my expenses in the same place.\u201d<\/span><\/p>\n

\"Original
Original artwork by Mar\u00eda Medem<\/figcaption><\/figure>\n

\u201cFor the tracking I use something pretty basic \u2013 Mac Notes,\u201d she continues. \u201cI write the client and the fee and when I\u2019m paid, as well as the month I\u2019ve been paid. Usually if I submit work in January they won\u2019t pay me until February or March, so writing the month helps me make an estimate of what I\u2019m earning per month. It\u2019s a real pleasure to write a check mark once you\u2019ve been paid.\u201d<\/span><\/p>\n

It\u2019s much easier to negotiate down than up<\/span><\/p><\/blockquote>\n

\"Sleeve
Sleeve artwork designed by Noah Baker for Carl Gari & Abdullah Miniawy<\/figcaption><\/figure>\n

Graphic designer Noah Baker follows a similar system, and says he experimented with the Notes app as well as Google Sheets before settling on Notion, which lets him keep track of deliverables as well as invoices. \u201cI think it\u2019s important to have something, but because I\u2019m trying to keep it as lean as possible I don\u2019t want four different programmes I\u2019m using for four different things,\u201d he explains. \u201cFor me it\u2019s best to have it all in one place and one account.\u201d<\/span><\/p>\n

It makes sense to stash all your invoices and business expense receipts in one place, so they\u2019re easily found. Hang onto them, as HMRC requires you to keep at least six years of documentation. And for anyone that dreads going through the annual receipt pile for their tax return, adding a tab to your spreadsheet with a running list of monthly expenses can ease the pain.<\/span><\/p>\n

\"Vinyl
Vinyl artwork designed by Noah Baker for Nick Murphy<\/figcaption><\/figure>\n

KNOW YOUR WORTH – DON\u2019T UNDERCHARGE<\/span><\/h4>\n

How much to charge is a perennial issue, and even well established artists aren\u2019t always sure. It\u2019s not an exact science, but it\u2019s useful to get some background on your client and the project to start with. \u201cNot pricing without context is something I learned pretty early,\u201d says Baker. \u201cI worked on one record project that I basically did for free, and then right after another record project where I got paid a lot more. That was all context dependent \u2013 the first one I really wanted to work on, and knew there was no budget.\u201d<\/span><\/p>\n

\"Type
Type Hike poster designed by Noah Baker<\/figcaption><\/figure>\n

It\u2019s worth noting that some clients will pay hourly, some will offer a project fee, and some will want a day rate. One method is to establish the lowest day rate you\u2019d be willing to, and can afford to, accept, and work everything out from that. Bear in mind that bigger brands and companies are likely to have more budget, meaning you can increase accordingly. Make sure you know how your work is being used and in how many countries – as this can also push up your fee. The AOI<\/a> offers some great support and online resources for illustrators, and there\u2019s no shame in asking a fellow creative for a rough idea of what they might ask for. <\/span><\/p>\n

Most importantly, don\u2019t undercharge. Many artists undervalue their time and worth, and most clients won\u2019t let you know if your fee is too low. It\u2019s much easier to negotiate down than up, so don\u2019t be afraid to ask for what you feel your time deserves – it\u2019s usually more than you think.<\/span><\/p>\n

\"Original
Original artwork designed by Nicholas K Law<\/figcaption><\/figure>\n

HANDLING INVOICES<\/span><\/h4>\n

Some creatives prefer to design their own invoice, however using a basic template is absolutely fine. Find out who and where it needs to be addressed to, and the person you should be sending it to. Some larger companies have invoicing frameworks and processes in place, which might require you to set up an account on an internal site, but for smaller organisations it\u2019s often just a case of emailing the document over. <\/span><\/p>\n

Read up on exactly what bank account information you need to include, particularly if it\u2019s an overseas client as they might need extra details. Once you\u2019ve sent your invoice out, make a note of the date you emailed it, the date you\u2019re expecting payment, and the invoice number, so it\u2019s easy for you to chase if you have to.<\/span><\/p>\n

\"Original
Original artwork designed by Nicholas K Law<\/figcaption><\/figure>\n

WHEN THEY DON\u2019T PAY<\/span><\/h4>\n

Unpaid invoices are, unfortunately, inevitable. Most designers and illustrators have their own horror story, and sometimes it\u2019s impossible to avoid \u2013 clients forget, things get lost, and occasionally companies adopt an irritatingly laissez-faire approach to payment. <\/span><\/p>\n

\u201cSometimes the client will tell you when they\u2019re going to pay you, but other times they won\u2019t tell you anything,\u201d says Medem. \u201cMy advice would be to ask when the estimated day of payment is. If this day comes and they haven\u2019t paid you, I usually give them a couple of days of courtesy and write again. At the beginning I was kind of embarrassed when I was asking to be paid, and I know that other people are too, but this embarrassment is totally irrational. It\u2019s important to ignore it and just ask.\u201d<\/span><\/p>\n

\"High
High Tide Sound System Vol. 17 designed by Nicholas K Law<\/figcaption><\/figure>\n

Designer Nicholas Law says having a single point of contact can be useful, particularly when working with big companies with lots of stakeholders. Another potential route he suggests is going straight to the source. \u201cIn one case it was music-related, and the artist’s team was taking forever to pay me, so I just asked him,\u201d he tells us. \u201cHe got onto them and that kind of helped. It helps to have someone who\u2019s a higher stakeholder, who\u2019s been involved in the creative decisions, and is able to vouch for you.\u201d<\/span><\/p>\n

Having a contract in place can ease the process<\/span><\/p><\/blockquote>\n

\"Original
Original artwork by Mar\u00eda Medem<\/figcaption><\/figure>\n

Having a contract in place that clearly states how much you should be paid and when can ease the process, but also give you some support when it comes to chasing up late invoices. It\u2019s advisable to be diplomatic, but if the money still isn\u2019t forthcoming then freelancers in the UK can turn to the Lay Payment of Commercial Debts (Interest) Act 1998, which allows a \u00a340 late fee and interest to be added to unpaid invoices. Companies in the UK can\u2019t opt out of this, and bringing it into play can have a catalytic effect on even the slowest of accounts departments.<\/span><\/p>\n

Sometimes, the best way of avoiding late payers is to do some research on the company beforehand. \u201cA friend of mine won\u2019t talk about the specfs of a project with the client until they\u2019ve got on the phone,\u201d says Baker. \u201cThat\u2019s a thing he swears by and I\u2019ve started thinking about too. You can tell so much about the client and how your relationship is going to be on that phone call. You can sense if they\u2019re going to mess with you.\u201d<\/span><\/p>\n

\"Fictional
Fictional concert posters designed by Noah Baker<\/figcaption><\/figure>\n

TAXES ARE INEVITABLE<\/span><\/h4>\n

We don\u2019t need to quote the famous phrase, but there\u2019s no avoiding tax. It comes round every year without fail, and has the ability to completely derail your finances if you haven\u2019t planned for it in advance. <\/span><\/p>\n

\u201cThe rule I established for myself is always making sure I have a third of all the money I earned over the year set aside,\u201d says Law. \u201cI plan on the worst possible scenario and prepare for that, and then I\u2019m pleasantly surprised when it\u2019s not the absolute worst amount I\u2019d planned on.\u201d<\/span><\/p>\n

\"Original
Original artwork designed by Nicholas K Law<\/figcaption><\/figure>\n

HAVE A BACKUP BUDGET<\/span><\/h4>\n

Freelance work can be sporadic, and payments equally so \u2013 particularly if you\u2019re dealing with a reluctant accounts team that\u2019s weeks late on a big invoice. Having a separate rainy day account, if you can afford to, offers some reassurance.<\/span><\/p>\n

\u201cPayments in illustration work are quite crazy,\u201d says Medem. \u201cIt might be that a month with less work you\u2019ll get paid money for the months of more work. This has luckily just happened to me this summer. I try to have savings anyway because I\u2019m always afraid of these months with less work, but also I live in a cheap city so I think it might be easier for me to have savings.\u201d<\/span><\/p>\n

\"Illustration
Illustration for New York Times by Mar\u00eda Medem<\/figcaption><\/figure>\n

Having a backup fund can be handy for maintaining your freedom<\/span><\/p><\/blockquote>\n

Having a backup fund can also be handy for maintaining your freedom. Law says it gives artists creative autonomy, and means they don\u2019t have to accept any old commission for the sake of paying the bills. \u201cI think it\u2019s extremely important because then you don\u2019t have to compromise,\u201d he told us. \u201cWorking with other people takes you to places you wouldn\u2019t have been able to go to yourself, but at the same time takes you out of your comfort zone. If something happens where you don\u2019t want to work with an organisation or person anymore, you have the freedom to say no. I\u2019ve worked creative jobs I didn\u2019t want to, when I didn\u2019t have a choice. Probably the first year I learnt that if I have money saved up I don\u2019t have to say yes to anything I don\u2019t want to.\u201d<\/span><\/p>\n

\"Original
Original artwork designed by Nicholas K Law<\/figcaption><\/figure>\n

GET HELP<\/span><\/h4>\n

Having an accountant to help with your end of year tax can be a huge relief, particularly if you\u2019ve never done it before. They can also advise you on what counts as a business expense, and save you some money along the way. Some illustrators and artists might want to consider finding an agent, as that can remove the stress of negotiating fees and managing payment. <\/span><\/p>\n

\u201cBecause I\u2019m a newer illustrator, knowing how much to charge and properly invoice is a challenge,\u201d says Law. \u201cTrying to become more professional in how I bill people is something I\u2019m still learning, and picking up as I go along. So I\u2019m actually going to be represented with an agency to help with some of that. I know I have a lot to learn as far as interfacing with clients, and being able to pitch my work and ask for the correct amount of money.\u201d<\/span><\/p>\n

\"Website
Website and identity design for Dwell in Other Futures by Noah Baker<\/figcaption><\/figure>\n

It\u2019s all a lot to remember, and a daunting prospect if you\u2019re new to it. Experimenting with the best ways to keep yourself organised can prevent you from feeling overwhelmed, as can knowing your rights around late or unpaid invoices. There\u2019s also nothing wrong with faking a bit of confidence in the early days until your freelancer\u2019s intuition kicks in, and you develop a natural feel for what to charge. Overall though, whether it\u2019s invoicing, paying taxes or late payments, the best<\/span> approach can be summarised as being proactive and staying on top of things.<\/span><\/p>\n

Missed the previous article in our \u2018How To\u2019 series? Read it here: How To Handle Creative Compromise<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Our How To series has seen us look at getting your first commission, handling creative compromise and working from home. This time round, Mar\u00eda Medem, Noah Baker, and Nicholas Law tell us how they manage their money.\u00a0<\/p>\n","protected":false},"author":19,"featured_media":7228,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[138],"tags":[],"_links":{"self":[{"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/posts\/6402"}],"collection":[{"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/comments?post=6402"}],"version-history":[{"count":19,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/posts\/6402\/revisions"}],"predecessor-version":[{"id":12995,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/posts\/6402\/revisions\/12995"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/media\/7228"}],"wp:attachment":[{"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/media?parent=6402"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/categories?post=6402"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/everpress.com\/blog\/wp-json\/wp\/v2\/tags?post=6402"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}