Freelancing and gig work offer flexible ways to earn money, reach financial goals, and explore new career paths. Today, about 57 million Americans work in the gig economy, making up 36% of the workforce. This independence allows you to choose your projects and schedule. With flexibility comes financial responsibility. Freelancers must plan to stay financially secure.

In this guide from Fast Auto Loans, Inc., we will explain some tips for financial planning for freelancers. We’ll also explain how a title loan could help during a financial emergency, if other options are unavailable.

Top 5 Freelancer Financial Tips

Working as a freelancer is much different than a full-time job. Your monthly income can vary, so smart planning helps you stay ahead and stress-free. You should be more intentional in how you manage gig income to ensure you can afford your monthly costs.

The following are five freelancer financial tips:

1. Choose The Right Freelance Path To Match Your Lifestyle

Besides the extra cash, freelancing can appeal to those looking for a more flexible schedule working on something you love, such as writing or creating art for sale. Before starting, think about your preferred gig type, how often you want to work, and what each option offers.

Think hard about how this gig will impact your life and relationships. Set your hours so you won’t feel overwhelmed, make sure all the duties associated with the job will be things you like to do, and determine whether the pay is worth the time and energy.

2. Know What You’re Signing: Understand Freelance Contracts

Getting a freelance or gig job should be treated like signing up for a full-time job. When signing up for a gig, the employer should provide a document with the full details of the work you must complete and your payment.

The following are some of the details outlined in your freelance contract:

• What tasks are expected of you
• How much work you must turn in every day and week
• How much you make and how often you receive payment
• Work deadlines
• Rules for how to deliver work

Financial planning for freelancers should involve looking at your contract. You should understand all of the details outlined above. If you have any questions, reach out to the employer before signing up for the gig to ensure everything goes according to plan.

3. Stack Gigs To Make More Freelance Income

Whether you have a full-time job or not, you may be able to effectively stack side work to maximize your earning potential. One possibility is keeping a full-time job or taking on a few side projects.

To manage gig income, you should have multiple revenue streams to prevent slow months. While you may only be able to take on one side gig at a time, there are other ways to make money to avoid weaker earning months.

The following are side gigs you can stack on top of your primary freelance work:

• Rent out your home or room
• Deliver food with Uber Eats or DoorDash
• Complete online surveys
• Rent out your vehicle
• Sell items you no longer use

4. Understand How Taxes Work

Tax rules for gig workers and freelancers are different than what you’ve likely experienced with a full-time job. Typically, such side hustle work classifies you as an independent contractor, which comes with a new set of tax rules you must follow to properly do your gig economy taxes.

Usually, it means not using a W-2 form and paying taxes with each paycheck. Instead, you need to set aside a certain amount from each payment to pay taxes during tax season. One of the most important gig worker tax tips is to set aside money from every job to ensure you can afford your taxes. You should set aside about 30% of your income for tax season.

The following are some important freelance tax laws to understand:

• 1099-K Reporting Threshold: Online freelance platforms are required to report earnings to the IRS from workers who make more than $5,000 in a year.
• Self-Employment Tax Rate: Freelance workers must pay 15.3% of taxes on their net earnings. This covers Social Security and Medicare.
• Standard Deductions: Single filers have a standard deduction of $15,000. Married couples filing jointly have a deduction of $30,000.

5. Keep Side Hustle Savings

Having side hustle savings is essential for freelancers. It’s not enough to make money from side gigs; you must also use gig worker savings tips to ensure you have extra cash every month. These savings can help with slow months where you don’t make as much money or to help afford financial emergencies.

The following are some gig worker savings tips:

• Save 3-6 months’ worth of expenses in an emergency fund
• Cut out unnecessary expenses (eating out, subscriptions, etc.)
• Automate savings
• Create a savings account

Pay For Emergency Expenses With Title Loans

While these freelancer financial tips can help you manage your income, they may take a bit to take hold. In the meantime, you can face urgent costs you aren’t prepared for. In that case, Fast Auto Loans, Inc. can help with our Arizona title loan.

Title loans are secured loans that let you borrow up to $15,000 from the value of your vehicle. To qualify, you must own your vehicle completely, with a lien-free title in your name. Only cars, trucks, and vans with lien-free titles are eligible. You can begin your application online but must complete the loan process in person at one of our Arizona store locations.

Getting approved is simple with the following required items:

• A state-issued photo ID with your full name and age
• A lien-free car title in your name
• Your vehicle for a quick inspection

Get started by providing your name, zip code, contact information, and vehicle details online. We will call you to discuss the auto title loans process and even reveal if you can get approved on the phone. Bring your required items into one of our Arizona stores to get verified. After determining your value during a vehicle inspection, you can sign the loan agreement and receive your cash within one business day.

FAQs For Freelancers And Gig Workers

Do you need to pay taxes on small gigs?

If you make over $600 from a client, you will need to pay taxes. Your employer will likely send you a 1099 form. If not, you can request one, or you will have to put the side gig income into your tax return directly.

How can you budget with unpredictable freelance income?

Prioritize essential costs, like your rent/mortgage, food, transportation, etc., before saving money. Use the 50/30/20 method. Spend 50% of your money on your needs, 30% on wants, and save 20%.

Can you get a title loan as a freelancer?

Borrowers will not need to prove their income to get title loans at Fast Auto Loans, Inc. We will not check for proof of income, so you can get title loans as a freelancer. Just make sure you can afford loan repayment.

Apply For Arizona Title Loans - Borrow Up to $15,000 Today!

Title loans are financial emergency solutions for freelancers. If you cannot afford overdue bills, medical expenses, or auto repairs, Fast Auto Loans, Inc. can help with our Arizona title loans. Find out quickly if you qualify through our simple approval process, many applicants receive funds within one business day.

Need emergency cash? If you're a qualified vehicle owner, Fast Auto Loans, Inc. may help you get funds in just one day, all credit scores accepted. Start the process online, fill out our online contact form and get approved in person in less than 30 minutes.

 

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.