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Perspectives - 5 min read

Top tips on taking control of your finances and late payments

Are you thinking of going it alone in 2019? Want to take the leap from cosy PAYE slips and expense accounts to uncertain but exhilarating freelance life? Angelica Malin shares with you a few home truths about managing your cashflow.


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As a freelance journalist, small business owner and host of the Young, Wild & Freelance community in London for over five years, I can tell you the single biggest killer of the freelance/ entrepreneur/ running your business from a beach in Bali dream is: cash flow. The old adage stands true.

When it comes to being self-employed or running your own business: cash is king. But one of the biggest challenges facing all freelancers is managing cash – and more specifically, dealing with late payments. From my work as a freelancer and hosting our events, I know that late payment is one of the worst afflictions a freelancer faces, and all too common. We spend so much of our time and creative energy trying to get companies to cough up. It’s super frustrating, especially when you have overheads and bills of your own to pay. I feel you.

But, on the flipside, being a business owner who uses freelancers and contractors often, I understand the pressure a business faces to stay afloat and manage their own cash flow – too many payments out at once, and you can find yourself tempted to go into your overdraft or call up Wonga.

Basically, we all have needs financially, and there must be more respect and understanding for each other’s cash demands. Enough of my TED talk, let’s explore a little bit about managing your cash flow as a freelancer.

On a personal level, there are a few fundamental principles I follow to manage my cash flow. Firstly, I keep a very close track of what comes in and out of the bank (for both myself and my business) – I use QuickBooks for this, which I love. It helps me stay on top of which invoices have been paid, all my monthly outgoings and managing work expenses.

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There was a time that I literally didn’t want to check my bank account out of fear – but looking at your weekly cash flow is so important! It helps manage anxiety around money and gives you a better grip on your finances. Even a simple spreadsheet will help – where you track your monthly income, payments you’re waiting on and travel expenses. This will give you a sense of what’s working for your finances, and where to focus energy on.

Another principle I adhere to is SAVINGS. Not a lot, mind, but enough, to feel secure if I’m having a tough month. Every freelancer should have say, three months savings, to make themselves feel a little calmer about money.

Beyond apps, here are some tips I can share for good practice with managing our cash flow:

1. Have multiple income streams

One of the hard truths about freelance life, especially if love your work, is that being a multi-hyphenate can really help you. Relying on one thing as a source of income can be dangerous – what if the cash dries up? What if the industry changes? As a writer, I’ve found it really good to have a mix of corporate and commercial clients, writing for both magazines and publications, as well as more corporate gigs, like copywriting for brands. At About Time, we have a podcast, sponsorship and also host events – we have multiple revenues streams, which allows us to be flexible in our approach and respond to industry changes. I think it’s that you don’t rely too heavily on any single stream. You’d be amazed how many freelancers have some ‘unsexy’ work on the side, to pay sure the bills are paid.

2. Focus on relationships

Building relationships are the key to winning work, and steady cash flow. It’s better to have a few really good relationships with clients, than lots of companies that don’t really respect you. Focus on building a few key relationships with companies who know your worth, pay you on time and want to work together in a positive, symbiotic way. Try to get face-to-face as much as possible – I’ve found getting out of inboxes and into real life really helps build genuine relationships.

3. Price what you think you’re worth

It’s very easy to underprice yourself as a freelancer – you think that your worth is only in the work you do, but there are lots of other factors. Like the experience, expertise, long-term value that you bring to the work – all the years you’ve worked and learnt your craft and skill. Let me tell you this: the price you put on your work is the value you think you bring to the world. If you’re underpricing, it’s your self-esteem that needs work – ask yourself what you think your time is really worth, and be strong in your convictions. I want to say this loud and clear: price what you think you’re worth.

"Of course, one of the biggest stumbling blocks is late payments – when you’re relying on cash in the bank, and it doesn’t materialize that month. "

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Angelica Malin, Freelance journalist and Founder of About Time Magazine

Of course, one of the biggest stumbling blocks is late payments – when you’re relying on cash in the bank, and it doesn’t materialize that month. There’s so much to unpick on the topic of late payments, so let’s split it into two.

Firstly, what are your rights? And secondly, what should you do, if you’re owed money and no-one is paying you?

In terms of rights, always check in advance what payment terms apply, and make sure you have it in writing – I’ve been shocked sometimes by the payment terms of publishers, sometimes as long as 3 months. Make sure to protect yourself on the invoice – check your invoice has a date, payment terms stated (usually within 30 days) and consider including additional protections, such as the ability to charge interest or an additional fee for late payment.

Now, what to do if someone doesn’t pay you? Firstly, I would make sure to invoice early and invoice often. If the payment term has lapsed, I would email issuing a statement that the invoice hasn’t been paid (make sure to save this) – at this point, you may be able to add late payments fees.

This is always a judgement call on whether you want to jeopardize a relationship with a client, and how much you want to badger them! If you feel like it’s not worth ruining a relationship for, then perhaps start gentle and see if they cough up.

How to juggle and find balance in a multi-hyphen freelance career

I would suggest calling up the accounts department, recording the date and time. From here, if you still haven’t been paid, I would see a second invoice with late payment fees AND interest. Send another statement, with the original invoice and the new one. Send everything directly to the accounts department, and keep a written record of everything – dates, times, names.

At this point, most companies take you seriously and pay up – but if there’s still no response, you can send a letter recorded delivery, with notice that you are going to take them to the small claims court. If it gets to this stage, you may wish to take legal advice. It’s obviously a horrible thing to go through, but a problem so many freelancers face – it’s better to know your rights, the process of chasing late payments and what to do if you find yourself in this situation!