Lesson 5: Keeping a Budget
Added 2017-07-06 09:13:53 +0000 UTCMy newest Patrons might not know this, but I am writing an ongoing in-depth tutorial about everything surrounding commissions. This month, it's all about budgets!
Keeping track of your income and expenses is vital for a business.
Freelance artists are no different. If you take commissions on the side it might seem superfluous - but it is really handy. Even if it's just a simple Excel sheet, you'll want to keep track.
In principle keeping a budget is very simple, which is why this lesson is so short.
You write down your income (net profit) and your expenses and calculate your total profits (gross profits). If we delve a bit deeper, you'll want to have a monthly, quarterly and an annual report. You'll want to set a monthly, quarterly and annual goal - I've set my goal as the liveable wage in the UK.
Additionally, you'll want to be able to calculate and anticipate taxes in your budget. Research your tax rates and rules and incorporate them into your excel sheet. Most governments allow expenses to be tax deductible - find out what counts for you on your government website.
But if you dont like excel, this can all feel overwhelming.
Luckily there are accounting services (both online and irl) that will do the number crunching for you, calculate your taxes and often help you with any questions or problems you might have. I don't use an accounting service myself but a quick Google search should yield results of you're interested. They are usually not free, but if you hate excel you can save a lot of time and anger that would be better spent on working on your commissions.
Here is an example of my default excel budget - you are welcome to use it.
