Freelancers love the freedom to set their own hours, but many struggle with accounting. Here are five common mistakes and simple solutions:
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Mixing personal and business funds. Opening a separate business bank account makes it easier to track income and expenses and simplifies tax filing.
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Ignoring receipts. Keep digital copies of every expense, no matter how small. Apps like Receipt Bank or QuickBooks allow you to snap photos and store them.
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Not invoicing on time. Late invoices lead to late payments. Use automated invoicing tools and set reminders to ensure consistent cash flow.
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Skipping quarterly taxes. Freelancers often have to pay estimated taxes every quarter. Failing to do so can result in penalties. Set aside a portion of each payment for taxes.
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No backup records. Relying on one computer or a single spreadsheet is risky. Store your files in the cloud or use accounting software to ensure nothing is lost.
By avoiding these “bookkeeping mistakes freelancers make,” you’ll reduce stress and maintain a healthy business.
