How I made extra money while building my business

How I've made extra money on the side

When I first started freelancing I was mainly living off my savings while I built up my business. As I watched the money decrease in my savings account, my insides were filled with dread. Panic would sometimes overtake me and I'd think:

  • My business isn't building up quickly enough.
  • What if I run out of savings and my business STILL isn't doing that great?
  • I don't want to return to my day job, but what if I have to?

If you're at the start of your freelancing journey then you've probably felt the same way, or maybe you still do.

Here's the thing: money is important. Quitting your job to fulfill your dream of freelancing is super admirable, but you have to get used to the fact that your finances won't be the same to begin with.

It helps if you can make some money on the side of freelance biz. And there are plenty of ways you can!

In the past, here's some ways I've made money on the side:

  • Sold my clothes on eBay. I killed two birds with one stone here because I had a TON of clothes that I needed to get rid of. I made £300 / $455 on eBay.
  • Sold my furniture on Gumtree (or you could use Craigslist.) You can get decent money for furniture like desks and chairs. List it as 'pickup only' and see if it sells. Your junk is another persons treasure!
  • Taught someone. I charged hourly to teach IT skills to home-taught children whose parents weren't great with tech.
  • Sold blog ads. If you sell 5 blog ads at $10 each, that's an extra $50 per month. That could go nicely towards petrol (gas) for your car!
  • Replied to ads for small design jobs. Sometimes people don't want a total rebrand, they just want someone to add an opt-in to their site or fix their social media buttons. I found that I could fit about 4 or 5 of these jobs into one day, which provided me with some decent extra money.
  • Sold website reviews. A couple of local companies asked me to review their website and tell them what needed improving. They were industrial companies- not my target market at all- but I didn't mind because it was extra money.

Here are some other (random) ways you can earn some extra cash if you really need it:

  • Babysitting
  • Dog walking
  • Cleaning
  • Look for work on eLance, Freelancer and similar sites.
  • Become a mystery shopper
  • Become an affiliate
  • Be someone's virtual assistant for 2-5 hours per week.
  • Handle someone's social media.
  • Sell digital goods on Etsy, like photo overlays and Photoshop patterns.
  • House-sittng
  • Sell articles

Sometimes, prideful freelancers will refuse to make money in any way that isn't directly linked to their business. Don't be like that. Making extra money is clever- it's not a compromise and it doesn't reflect poorly on your business. You won't have to do these side jobs forever, but doing some of them when you first start freelancing can really help support you, as it did for me.

How I handle my bookkeeping

How I handle my bookkeeping

When I first started freelancing, bookkeeping felt pretty scary. I was always worried that I:

  • Wasn’t keeping the right records
  • Wasn’t keeping enough records
  • Was making mistakes with the numbers

I’m not going heavily into the ins and outs of bookkeeping because I’m a designer, not an accountant. But over three years I’ve tried a LOT of bookkeeping systems and I’ve learned a lot. So I’m going to explain:

  • What bookkeeping systems I’ve tried in the past
  • What I use now
  • What I recommend

The bookkeeping systems I’ve tried

There are two ways you can do your books: manually, or using online software.

First, I tried Freshbooks, which I loved in the beginning but swiftly realized it didn't fulfill all my needs. I didn’t want to use Freshbooks for invoicing my clients (because I use Pancake for that), but to add payments to Freshbooks I HAD to add invoices. It was a waste of time creating two sets of invoices and clients in both Freshbooks and Pancake. I loved the easiness of Freshbooks reports so much that I contemplated using their invoicing system instead of Pancake, but then realized that Freshbooks doesn’t allow you to create payment plans for clients. That’s when I cancelled my plan and looked elsewhere.

I tried Kashflow but I didn’t like the interface (call me a design snob!) so I stopped using it when the trial ended.

I tried Quickbooks but encountered some currency problems, and their support was no help whatsoever. I would have liked to continue using Quickbooks, but their support was so slow and rude that I cancelled.

I finally threw my hands in the air and gave up. I decided it was much easier to manually keep my records in spreadsheets. Looking back, I’d only recommend this if your income isn’t very high and you don’t have many transactions to record. If you want to give the manual approach a try, you can download my Profit & Loss template here.

What I use now

Until this month I was still a little lost when it came to bookkeeping. My income has been increasing by hundreds per month, so this month I started panicking about my books and almost hired a bookkeeper to handle it for me.

That was until I found Wave.

I’ve been trying it throughout April and I really like it so far. It’s totally FREE, it’s easy to use, and it offers the exact same accounting features as paid software like Freshbooks and Quickbooks.

If you need a little more info on Wave then check out this review.

I want to make sure I’m getting the most out of Wave and recording things accurately, so next month I’m going to invest in a consultation with an accountant who can walk me through Wave and check that I'm recording things correctly. I’m also going to hire someone at tax time to complete my tax return for me- that’s one thing I won’t ever attempt myself!

What I recommend

If you’re totally useless with numbers and bookkeeping scares you, just hire someone to do it for you. I've been working with Melissa who specializes in Wave. She's lovely and really knows Wave, so I totally recommend her!

If you don’t create payment plans for your clients, try Freshbooks! It wasn’t quite right for me, but I still love and recommend it.

And last but not least, give Wave a try. It’s free, it’s easy, and there are lots of bookkeepers who work with Wave if there comes a time when you want to stop handling your own bookkeeping and hire it out.

Hop into our Facebook group and share what accounting software you use and whether you'd recommend it!

How to build meaningful relationships within your business

This is a guest article by Zoe, front-end web developer at ZoeRooney.com

My entire business model is based around relationships. I don't market my work nor do I take clients directly. All of my work comes through the relationships I've built with designers and through previous clients' referrals. I have absolutely had my fair share of business relationships that end up feeling icky. On the flip side, I have a number of really wonderful relationships that have lasted years.

Things Not To Do

There are a couple of things that I'm pretty sure always go badly when building relationships (and I think these can apply to business more generally as well):

  1. Ignoring your gut. Every single time I have ignored a gut feeling telling me "I'm not sure I want to do this," I have completely and totally regretted it. I don't have gut feelings about every potential project or client, and this isn't a threshold that every project passes. It's more that if there's a "no" voice anywhere in my head I've learned to listen.
  2. Overvaluing the cool factor. I've had clients ask for a lot of value for a discounted price because they're well known or doing something cool. While there's absolutely value to high-visbiilty projects, I've learned to be super careful in these situations. There's a very fine tipping point from "everything is awesome" to "I'm being taken advantage of," and the only way to avoid the fall is to be extremely careful about not overvaluing the cool factor.

Things To Do

On the flip side, I've found a few things to be consistently helpful:

  1. Doing Unto Others. I try to put out there what I want to get back. When I was first contacting designers I wanted to work with, I cold-emailed them with a message that was all about how much I admired their work (with specifics). Then, I'd end by saying I'd love to hear from them if they needed extra development capacity. It's never about what I can get from someone else. People can tell when you're selling to them and it doesn't create a relationship, or at least not one that will last. Similarly, I don't try to sell myself to clients. Either we're a fit or we're not, and it's important to me that both sides reach that conclusion without sales tactics muddying things up. This is tricky when a client is struggling in one way or another and takes it out on me (happens occasionally), in which cases I try to remember my friend-via-business-relationship Meg's advice about client good vibes. Doing unto others also covers things like sharing via blog posts and answering every single advice-seeking email.
  2. Telling it like it is. Telling it like it is with regards to project costs, time frames, availability, whether or not I want to work on a project, whether I can even do what someone is asking me to do, etc., can be hard. This is especially true when it involves saying no, particularly  when the person has asked really nicely and with great enthusiasm. I find that thinking long-term helps. Perhaps I have to say "no" right now, but by doing so honestly and nicely (and by offering suggestions for where to go next), I'm still building a relationship with that person in case the next time they ask it's a "yes."
  3. Keeping business as business. Business is not personal. Even when the relationship with the client is friendly and we're all telling it like it is, the work is not personal. In my experience, the more I can clarify and come to agreement with people I'm working with on the project goals, scope, specifics, and outcmes in advance, the better. Each business decision doesn't have to also have a huge impact on the relationship, but the relationship starts to filter in when things are unclear.

For me, I think it all comes down to keeping it real. We're all people here and we're all doing the best we can. My role is to keep doing my best and to do what I can so everyone I work with can do their best, and at the end of the day we'll all feel good enough to keep on working.

Zoe Rooney runs a small front-end web development company focused on working with talented designers to create beautiful, functional websites. She works mostly with WordPress and Shopify, and for creative businesses and bloggers. She is also a wife and mom to two little boys.

Why blogging is important for your business

This is a guest article by Lisa Butler of Elembee.

I first hit publish on my blog in September 2010. I had no plan, and no real purpose for it beyond having my own online design playground.

These days, anyone will tell you that to have a successful blog, you need to have a brand, a plan, a purpose, an understanding of your audience. It’s enough to make your head spin.

I’m not here to tell you that. What I am here to tell you is that blogging can be a very powerful platform for making things happen in your life. You see, by simply sharing my point of view and personal style, I began attracting the kind of work I wanted to do and the clients I wanted to work with. And any time I’ve wanted to make a change in my business, I’ve started with my blog.

I’m not going to tell you it’s easy. Blogging regularly takes time and dedication, and you will often feel like you’re not getting anywhere with it. It’s hard to choose blogging when a paying client is waiting on you.

So how do you make it happen?

For me, it comes down to two things: make it non-negotiable, and accept imperfection.

If you only feel comfortable setting aside an hour each week for blogging, then do that, and make the most of your hour. Make it a recurring task on your to-do list, and cross it off before you do anything else. Otherwise, it’s too easy to get caught up in client work until you’re too exhausted to blog.

But I think our biggest barrier to blogging isn’t time — it’s ourselves. We put a lot of pressure on ourselves to publish perfect content. But if there’s anything I’ve learned in almost five years of blogging, it’s that our work still has value even when it’s not perfect. It’s OK for your blog to be a work in progress — that’s how you improve. When you’re tempted to say that you aren’t feeling it today, I encourage you to move forward anyway.

Lisa Butler is a web designer, developer, and blogger at Elembee.com. She offers straightforward web guidance for making it happen online. When she’s not sleeping in or working from her studio in Tulsa, OK, you can find her at the dog park with her dog Dobby (yes, like the house elf from Harry Potter), or with her bags packed for her next adventure.

How to know how much to pay yourself

Before you use your income planner to plot how much money you're going to make this year, you need to figure out how much money you actually need.

Did you know that people tend to underestimate the monthly amount of money they need by over $1000? That's a lot of cash!

When it comes to money- YOUR money- it's waaaay better to be safe than sorry. You need to earn enough money to put food on the table and keep clothes on your back, not to mention afford luxuries like vacations, high heels and wine! Figuring out how much money you need per month should be something you do once a year (because your expenses are always changing), so if you haven’t done it this year then I encourage you to do it today! Here's how you can:  

Step one: add up your bills

First, get your bank records out. Then thoroughly and honestly add up your expenses in this expense tracking template I've made for you. There's no room for guessing! Guessing = underestimating.

Don't forget to add in your yearly bills. It's easy to find your recurring monthly bills, but yearly bills like car tax and web hosting tend to slip from people's minds.  

Step two: plan your income with your expenses and overheads in mind

It's time to whip your income planner out because I'm going to show you how to use it!

Now that you know how much money you spend on bills, think about how much money you'd like to spend on luxuries for you and your family. For example, how many holidays a year do you want to take? Do you want to be able to get a bigger house? Do you love going on shopping sprees? Or are you content with a simpler life?

If you want more luxuries you will need to set a higher income goal.

In your income planner, fill out the sections I've highlighted below.

fill it out
fill it out

If the sum of your services and products don't add up to your income goal then there are two things you can do:

  1. Find a way to earn more money. Could you sell more products by spending more time marketing? Could you take on an extra client each month?
  2. Decrease your expenses. Figure out a way to save money on certain bills or cut unnecessary bills out. For example... Do you really need Spotify? Do you need that extra holiday each year? Can you last without your Starbucks coffee every morning?

When you're happy with the sum of your products & services, take a step back and admire your plan. In one simple yet very powerful spreadsheet, you now have a plan that shows you:

  • How much money you want to make for the year
  • How you're going to make that money
  • What your monthly income will be if you achieve your sales goals.

Sounds like the start of a pretty awesome business plan to me!

Working out how much money to pay yourself isn’t as hard as it seems, is it? Because we’re creative, money-related things like this can sometimes feel scary. But if you follow the steps above you'll be able to predict your monthly and yearly income really easily.

Important tip: If you don’t earn as much money as you plan to then don’t fret- just change your plan! The most effective plans are the ones we keep updating.