Do you know what you will earn as a freelance writer this year?
Or let’s say, I’ve got a real good idea of the figure I’ll see when I close the books on 2011.
How can I tell?
We just passed the six-month mark — halfway through the year.
That means it’s time for your half-year checkup. Not a doctor’s visit, but a financial-health checkup, to see how your freelance-writing business is doing.
At this point in the year, you can add up what you’ve earned from writing so far, multiply by two, and get a good estimate of your gross annual earnings.
Don’t like what that figure tells you? Then it’s time to start marketing your writing business more aggressively to bring in new clients for the back half.
Speaking of which, midyear is a great time to analyze your past marketing efforts, too, and see what’s paying off…maybe tinker a bit with how you’re spending your marketing time.
Not tracking your earnings? Then it’s time to start.
The more aware you are of what’s coming in and going out, the better you can gauge whether you have room in your schedule for a new project — or whether you’ll be able to cover your bills. I’m kind of a numbers dork, so I’m always fascinated to add it up and see how I’m doing.
Tracking your earnings — and your bookings — doesn’t have to be complicated. For years I just wrote a bunch of entries in a Word document and added them up with a calculator.
I’ve got better data now because starting this year, I’m invoicing through Freshbooks (which has a free level for the first few clients you track). It allows me to see instant totals by month, by client, or about any other way I want to cut the data. Love it!
We’re far enough into the year that you can do some serious analysis of your client base, too. With Freshbooks this is a snap — I can tell at a glance who my biggest clients are, and what I’ve made from each one.
This is useful information to bear in mind when a client’s annoying and you’re thinking of telling them to shove it. If your data shows they’re one-quarter of your income, you might decide to keep your cool. Or maybe the numbers tell you they really aren’t worth the trouble.
Think not just about totals but the hourly rate each client represents. It may be time to weed out a few losers, or try to pitch your higher-paying clients more projects.
Each month, I start with a forecast of earnings based on bookings I have. That tells me how much more work I need to find to make my target for that month.
I try mightily not to let any assignments’ deadlines (and revenue!) slip into the following month (failed that course in June, though). That creates a domino effect of lower monthly income that leads inevitably to lower annual income.
But back to my numbers.
Last year, I came within spitting distance of earning six figures from writing, but fell just short.
This year, my projection is I’ll be solidly over that line. That’s been a goal of mine for a while, to officially be a six-figure freelancer, so that feels great.
Of course, there’s no guarantee that the second half of the year will turn out like the first.
I’ve got vacation weeks coming up that will cut into revenue, and clients will come and go. But I like having a solid estimate of what I’ll earn.
If your income is too unpredictable to make a year-end estimate at the half, it’s time to even out the bumps and lumps. The best way to do that is by finding bigger clients with ongoing assignments and better rates, so you start each month with some good-paying work already booked.
Have you done a year-end estimate? Tell us how you track your progress.