how do you deal with freelancer terror?

I meant to make this an “ask the readers” question as per my new Thursday tradition, but I started writing just a short response to it and then it got longer and longer. So it’s not quite that anymore, but hopefully readers will weigh in as well.

I’m an avid reader of your blog, even though I haven’t had a standard office job in about a decade. I’ve been a freelancer/independent contractor all that time, in a competitive, creative industry. My work is fascinating and fulfilling; working at home on my own time maximizes my strengths while minimizing my professional weaknesses; and I’m happier doing this than any other kind of work I’ve ever tried. I’m nearly 50 and have worked in four different professions, so I’m glad to have found the right track for me.

But the one big downside is the uncertainty. I hate not knowing when work will come, or precisely what money will be coming in at any given time. (My quarterly taxes are an exercise in amateur soothsaying.) This means that when I have multiple offers, I take them all and work myself ragged. Then I tell myself I won’t do that again—and I hit a brief dry spell, which fills me with financial terror. Sometimes it feels easier to be a workaholic than to deal with the anxiety. Budgeting only gets me so far, as my income varies widely, and quarterly taxes therefore become a huge variable. (In my best year I made mid-six-figures; in my lowest year, mid-five-figures. At the start of each year, I have only a rough idea where I’ll be on that continuum.) I bought a house I can make payments on even at the lower end of my range—but it’s the not knowing that drives me batty. I can’t stop thinking that this is the year it all falls apart. Sometimes I think of getting a day job again, but I never did any better at that than my lowest earning freelance year, and I genuinely love the work I do.

I would love to hear your advice (of the other readers’) for dealing with freelancer job anxiety, particularly in creative fields. Unless it’s just “Xanax.”

Yes to Xanax.

For years, I dealt with this by taking on as much work as I could humanly do, which meant that I was often working nearly all of my waking hours and rarely seeing friends and family — and was still living in fear that it could all change in an instant and I could be penniless and homeless. It sucks to live that way! (Your line “Sometimes it feels easier to be a workaholic than to deal with the anxiety” captures exactly how I felt.)

I eventually decided that there’s a certain point where one has been successful enough at one’s chosen work that it’s reasonable to trust that you’ll continue getting work and it’s okay to turn things down and make room in your life for non-work things, and it’s so much better … but I still always have that fear in the back of my head, and maybe all freelancers always do.

The best thing to soothe that fear that I’ve found: savings. In your good years, pile all that extra money into savings. Then you can look at your finances and tell yourself things like, “If I stopped getting any work tomorrow, I could still live just fine for X years/months, and that would be plenty of time to find a regular job if I needed to.”

That doesn’t mean that you have to live at the income level of your worst year, but I’d look at what you make most years, and then live around that level (while keeping things like your mortgage payment affordable for your worst years too, as you’ve done).

Also: Have a plan! You keep thinking that maybe this will be the year it will all fall apart. It probably won’t, but who knows, maybe it will be. What would you do if that happened? Gaming that out and knowing that you have a plan in case that happens will probably help you feel more comfortable.

I also think one of the hardest things about working for yourself is that there’s no ceiling on what you can make. You could potentially earn way more than you ever could at a normal job. So even if you’re making enough, you have to wonder if you should spending more time working so that you earn even more (to safeguard yourself against future leaner times, or just because you love money, or whatever). But that’s how people end up working around the clock — so at some point you have to decide what else you want from your life, and how you want to balance that against the money piece.

Readers who work for yourselves (or have in the past), what’s your advice?

{ 244 comments… read them below }

  1. Emi.*

    I am also on Team Make A Plan! I’m not a freelancer but I am generally prone to anxiety and I find it helps immensely to sit down and say “What’s the worst-case scenario? Okay, but what’s the worst reasonably plausible scenario?” and make a plan for that. Because it usually turns out that the worst reasonably plausible scenario would actually be basically okay.

    1. Jesca*

      Yeah. I basically have two budgets. I have one at my current salary and then I have one if my salary gets cut drastically. Basically we wouldn’t be able to go on vacations or buy a ton of new things, but we would live. I keep both as templates so I know already where to cut the fat if worse case comes through.

      1. GG Two shoes*

        I love this idea! I had to do this already when my husband went back to school, but it wouldn’t be the worst thing to do this in the event that one of us loses our jobs.

    2. Future Homesteader*

      Amen to this! With my anxiety, I constantly worry about losing my job (even though it’s never happened yet and I have no reason to believe it will any time soon). Knowing how unemployment works, what kinds of jobs I could fall back on if I had to, and how far my savings could get me helps immeasurably. (Also, Zoloft.)

    3. Thursday Next*

      This is an excellent distinction. Uncertainty has a way of spiraling into Disaster! Panic! thinking, and it’s good to have some measures (such as this “reasonably plausible worst” language) in place to end that spiral.

      Our family’s income also fluctuates from year to year—we’ve had to plan around the “reasonably plausible worst” (which has, in fact, happened) and the planning we did saw us through.

      OP, you’ve been a very successful freelancer for a long time—it’s a good time for you to look over the entirety of your freelancing career and come up with some “historical” averages that will help you pilot more comfortably through your uncertainty.

      (Also, in all seriousness, if you’re having full-blown panic attacks, yes, you may want to consult a doctor about suitable medication.)

    4. Arya Parya*

      That’s what my SO and I do as well. We’re not prone to anxiety of anything, just careful. We bought a house for a price well below what we could have afforded. We got a mortgage where the monthly payments get a bit lower each month, because we are slowly paying it off. That way if our income gets lower somewhere down the line, we should at least still be able to pay that.
      We also always have a buffer of savings we can live of for some time, should either of us lose their job. And we save money for everything else (holiday, home relaties, etc). We don’t want any other loans than our mortgage.
      These things give of some peace of mind.

    5. Kim, aka Ranavain*

      Yeah, I tend to stave off anxiety by thinking about worst-case scenarios and figuring out how that would be OK. Like, I am fully aware that if I were in absolute desperation, I know of people whose couches I could crash on. My sister in Idaho has a spare bedroom. I’m comforted by the fact that even the worst scenarios I can think of are completely survivable, and that helps a lot! (It’s also humbling, because even though I come from a poor background and no one in my family is well-off, I have options that I know others don’t have. There is virtually no way for me to be homeless unless I truly chose to be. Remembering that I’m among the Americans With Options is comforting.)

    6. LQ*

      I always draw the worst case scenario out to it’s entirely doom and gloom ending of the entire world is destroyed. It makes me much more cheerful about addressing the, yes, but what is likely to actually happen that is bad?

      I had a bought of extreme work anxiety and I lined up three people who I was pretty sure would help me find a job tomorrow if I needed one. And I talked to two of them, both of them started drafting what the job would look like in their heads as we talked, that was very reassuring. They wouldn’t have been perfect jobs, but it would have been enough to get me through until I found a better fit. Every day I have a bad or uncertain day, I think back to those three and realize it’ll be ok. I’ll make it through.

    7. Freelancer OP*

      I try to do this too. It was more effective early on, I admit. At this point, though, it’s been a decade since I worked in an office. The kind of work I do is virtually always outsourced, meaning it would be extremely tough to find a day job doing the same thing. My references for the other work I’ve done in the past are getting pretty old/remote. I think returning to 9-5 would be a challenge. That said, I think I could do it. Maybe I could also branch into the occasional freelance work that would segue more naturally into regular employment, if needed.

  2. bunniferous*

    Those of us in the real estate field deal with that too. At some point you have to carve out time for yourself and family or you burn out. What I would do is decide what your maximum work hours should be in any given week and then keep to that. But yeah, the feast or famine cycle is a thing. I will be watching this discussion with interest myself (In my case my work load gets assigned by the VA and the only control I have would to be to give assets to someone else-and for reasons, I can’t do that. The struggle is real!)

    1. Freelancer OP*

      I do set regular hours generally—but some of my projects really do require intense periods of work. Which is fine, as my compensation reflects that. But I definitely need to be more careful about not taking on too many projects like that in a row.

      1. TardyTardis*

        Parceling out money to different categories (bank fairies are very good at helping with this) which I call Hungry, Hungry Hippo (what you absolutely must have to live on), the Dead Water Heater Fund (fairly obvious), Break Glass In Case of Emergency, You Too Shall Turn Old and Gray, and last, but not least, Oooh Bright Shiny. And yes, you are allowed to have a different bank account for each one. Of course, taxes throws a spanner in the works when trying to figure how much goes into which fund, because obviously it will be part of the Hungry Hungry Hippo category and will affect how much goes into all the others. My son, for instance, keeps his savings account at a different bank than all the rest, and he *can’t* check it online because it’s proven to be a really bad idea.

  3. DataGirl*

    My husband is a consultant and we deal with this stress constantly. It helps that I have a steady paycheck and healthcare, but my income alone is not enough to pay all our bills. In his industry he can work steadily for a few months, but then have several months with no work at all. We try to save as much as possible when he is working, but usually after a dry spell we’ve both gone through the savings and accumulated a few large bills that need paying off as well so it’s really hard. We budget absolutely everything and I check that we are sticking to plan on a weekly basis. But the stress is always there. My sympathies.

  4. Cara*

    On the budgeting front, check out YNAB (short for You Need A Budget). I haven’t personally used it in years, but it is built around a really solid philosophy that incorporates variable income. Worth reading its “four rules” even if you never use the software.

    1. Natalie*

      Yes, long before the software existed my parents used this kind of budget as “envelope method”, and you’ll also see it called zero-based budgeting. It’s great conceptually no matter how you personally handle the logistics.

    2. Kimmeh*

      I do love YNAB! You might also like Mint. I feel it’s a bit less user friendly, but it’s free! And you can connect it to billing accounts and it will remind you when things are due. I’d probably miss my electric bill all the time if I didn’t have these reminders.

      1. Naptime Enthusiast*

        I love Mint, the browser is more user-friendly than the app but the app is great for looking at when you have a few minutes to see where you are. I use the rollover feature for months rather than setting the big-budget “goals”.

    3. Your Weird Uncle*

      I second this. My husband and I have used it for years, and it really takes the worry and stress out of planning for the future. After using it for about 3 months, I went from worrying that my debit card might get rejected every time I used it, to being able to pay off an unexpected four-figure medical bill without blinking.

    4. Kelly White*

      I learned about YNAB from a suggestion on here, and it has seriously turned my life around. I highly recommend it. We have found that is worth the money. The support (forums, classes, Facebook) are amazingly good!

      You can get a free trial for Ynab (if you ask them, I believe they extend the trial to 3 months) which would give you time to really understand how to use it.

      Should you go that route, I strongly suggest taking the classes- they are invaluable.

    5. BPT*

      I feel like YNAB is the absolute best for freelancers or those whose income varies.

      In YNAB you should definitely buffer a month ahead. This can take some of the immediate “when will I get paid” stress off. This is not the same as an emergency fund or other savings. Basically, you want to get to the point where you put all your checks you earn this month to next month. You might have to build up to this or dip into savings at first to accomplish this, but say you need $4,000 a month to just get by and $5,000 to live comfortably. In May, you get paid $1000 on the 1st, $1500 on the 3rd, $500 on the 15th, and $2500 on the 21st, for a total of $5,500 in May. You don’t spend any money from these checks in May, but put them aside in a category in your budget for June. June rolls around, and you’ve got your spending money for that month, plus $500 you can put into “Low Income Month Fund” category.

      Now you’re spending May’s money in June, and any money that comes in during June gets put into July’s category. Now say in June you only manage to pull in $3500. You have that at the beginning of the month, and then you pull the $500 from your “Low Income Month Fund” category to get by. The benefit of this is you know how much you have to spend at the beginning of the month instead of having to guess as checks come in.

      In addition, you can start building up an emergency fund, as well as savings for things you know will happen, you just don’t know when. I.e. car and house repairs, extra taxes, sickness, etc.

    6. JellyB*


      I came here to recommend YNAB, which has quite literally changed my life in the 6 months I’ve been using it. They have a class (free and online) specifically for budgeting with variable income, and there’s a Facebook group I’ve learned a lot from.

    7. Rezia*

      Not sure you need more YNAB validation but here’s another +1.
      I get anxious; YNAB brings me peace.

    8. Freelancer OP*

      I got this app and don’t understand it at all! My main frustrations are that it seems to sync with my bank account on a very irregular basis, and the whole “this isn’t just a monthly budget!” thing. That’s great and all, but I also really would like to be able to set up that monthly budget, and it seems like the app doesn’t let me. Can anyone walk me through the basics here? Would it be better to use YNAB on my computer rather than my phone?

      1. Natalie*

        There is absolutely a learning curve with YNAB because as you noticed, it is *not* a monthly budget. You don’t budget based on what you expect to make this month, you budget the dollars you have in your bank account (or in your wallet) right now. When additional dollars come in, you budget those. And so on.

        I personally find it a lot easier to use on the computer versus the mobile app – the mobile app is better for adding a transaction while I’m out and about, but I almost never construct my budget on my phone.

        1. Natalie*

          So, you said downthread that you sometimes go months in between large payments for your work. That can make it a little trickier just to get up and started, but if you’re fairly confident that you’re living within your means, you could always start like my spouse and I did and just track your spending.

      2. AliceBD*

        A) Yes it is probably easier to get comfortable with it on a computer.
        B) If it doesn’t sync with your bank often enough for you, just enter things manually and it will find duplicate transactions when it does import. I’ve used YNAB for 7 years with 3 versions and have never connected it to my bank; connecting it is not right or wrong but a personal decision. You can always enter things as you spend them (that is where the phone app is most helpful IMO, to enter purchases on the go).
        3) Have you taken the classes? I HIGHLY recommend you take them. It’s OK to take them multiple times if you need repetition to understand something (I frequently do). The forums can also help.
        4) You can definitely set up a monthly budget.

      3. JellyB*

        There is definitely a learning curve for YNAB. Part of it is just learning the software, but a bigger part is really wrapping your head around the rules and embracing what for most people is a pretty big mindset shift. The online classes are essential, and the people in the Facebook group are very helpful with newbies. I understand that you can get your free trial extended to 3 months if you’re not quite getting it by the end of your first month.

        I know it’s intimidating, but it’s given me such a sense of control and peace. I definitely think it’s worth spending the time to learn.

        1. zora*

          It’s definitely a mind shift. It kind of works backwards from traditional budgeting the way I was taught, and I was mystified for a while, but I took a few classes and when it clicked it made so much more sense than anything involving math ever has for me. It has dramatically changed my life, as well!

      4. Ella*

        If you haven’t, the tutorials and webinars that YNAB publishes were hugely helpful to me. There’s also a community on reddit where you can scroll through past questions and answers.

        I think for me, the biggest moment was realizing that I was looking forward with the money that I already had. The past was the past. I was no longer *tracking* expenses, but *planning* them.

        I personally don’t sync with my bank accounts at all. First of all, my credit union won’t authorize it, but even so, it was better for me and easier to stay on top of things if I manually enter everything. I did put in a lot of recurring transactions (see below) to lighten the load of inputting everything in manually.

        One thing you might explore that might help you with wanting a monthly budget template is that you can schedule transactions, and then on that day YNAB will tell you that the transaction needs to be confirmed (this happens in the Accounts area), or you can set goals in your Budget screen. My rent category has a monthly goal set to remind me to put money in it, for example. For trips, I set a goal to have a target amount by a certain date, and then it prompts me to put in a certain amount each month so that I’ll reach my goal in time. Or you can tell it that you want the balance to be X, without putting a time limit on it.

        The other thing to remember is that YNAB won’t reset the budget category every month. If you put $30 into your New Shirts category in June, but then you don’t buy any shirts in June, the $30 will just roll over into July. That’s part of how you start building a buffer. If you have $8000 extra dollars lying around and you want to put it in your Mortgage category, you can do that, and then just spend out of it without replenishing for the rest of the year or whatever. The money stays in the category you put it in until you spend it.

        I don’t know if that helps?

  5. Naomi*

    I’m not a freelancer, so I haven’t been there, but have you considered looking for part-time jobs? The idea being that you’d have a reliable income, even if it was only a little, but would still be able to take freelance gigs.

    1. Alternative Person*

      This is similar to what my friend does. She has lots of freelance/self-employed work but anchors it with a couple of regular gigs at a company to make sure she has some regular cash flow month to month.

    2. Meh*

      When I briefly freelanced, this was the model I used and it wasn’t bad. The part-time job was telecommuting so it didn’t interfere too much with the freelance gigs. Though I found I still didn’t like the various levels of income, so when a full-time position with benefits opened, I dropped both and just took that.

    3. sam*

      +1 to this. I’m not a freelancer either, but a lot of the folks who used to work either part-time or ‘oddly’ houred shifts at my old law firm’s word processing department did it specifically because they wanted a baseline income to support their acting/writing/musician/other creative fields that didn’t have steady paychecks.

      (also, depending on how many hours they worked, they qualified for health insurance. In the days before the ACA, this was super-important).

    4. Countess Boochie Flagrante*

      Back when I worked retail, we had an employee who was primarily a freelancer; she was scheduled by default 4 hours every other week, just enough to keep her listed as an employee, but when she was between jobs she would call the store manager and give a new availability that would be good for the next however-many weeks until something new came along, and she got higher hours during those times.

      Granted, because of our type of retail we didn’t have as much seasonal variability as some, and she had a lot of goodwill built up that helped to make it all work, but it seemed like a good arrangement to me.

    5. AW*

      This is what I do. I have a flexible, mostly WAH salaried part-time job (yes, I know this is a unicorn), and that allows me to take on pretty much any consulting gig that comes my way. It brings in about half or a little less of my income most months, but there are definitely more lean months where I’m thankful for that steady income.

    6. Freelancer OP*

      I’ve considered it, but unfortunately my freelance work requires a level of flexibility that would make regular jobs tough-to-impossible to keep.

      1. And So it Goes*

        First off, you are in a very good position in that you seem to have a steady stream of work, that is wonderful. It shows that you are good & reliable at what you do, great! Now, bear with me:
        1. Figure out what you want to earn a year, not your max, but what you want in an average year to live comfortably AND put some away for savings/retirement.
        2. Divide that out by the number of hours it would take per week to earn that at your current billing rate.
        3. From that point take on projects that fit that number. With a caveat.
        4. Caveat: If you go below that number a certain # of weeks then when extra projects come in take those extra projects for the time being then when it stabilizes go back to your optimum.
        5. The Goal: to have a steady flow of work and balance. Believe it or not by “sharpening the saw” you will elevate your overall peace of mind, work more efficiently and draw in a more steady line of work. Success breeds success.

        There is more to this overall approach however I trust you get the gist of it. Again, congratulations on developing a great book of work! Peace.

  6. mia*

    My husband is a consultant and I totally get it. We did what you suggested – stock tons of his income into savings and also purchased investments that pay returns, like multiple rental properties. I have a full time job too which helps, but we can live off my income.
    His last contract ended 2.5 months ago, and he doesn’t have one right now…and loves it. He spent the last 5+ hours working mad hours, and decided that we saved and invested enough to take a little break.

    So save, invest, and have a baseline where you want to be, and the rest is just gravy.

  7. Thomas E*

    Savings. At least enough to survive a year with no income. Plus, no debt. Plus,backup retail skills can use of the worst happens.

    1. Lady Jay*

      At the risk of being “not everybody can have sandwiches”y, a whole years’ salary is really hard. I’ve been working full-time since I received my master’s degree eight years ago, no debt, not a big spender (e.g. I shop at thrift stores and only got my first smartphone a couple of years ago), and I have *barely* a year’s salary saved up.

      Usually the advice is 3-6 months. I have easily 6 mos salary saved up, and that’s a comfort, since 6 months is enough time to put together a plan and act on it.

      1. Emi.*

        It is hard but I think it’s a good goal, and if fat years are this much fatter than lean years it’s probably achievable.

        1. Victoria Nonprofit (USA)*

          Agreed. For most folks, a year’s worth of liquid income is laughably impossible to achieve — but for someone whose best year was ~10x more than their worst year, it seems very doable. (Or it would, if they had another “best year ever.”)

      2. I'm A Little TeaPot*

        How much you need to have in your emergency fund is going to vary a lot based on circumstances. For someone in freelancing, a larger fund might make more sense. For you, it sounds like 6 months is the sweet spot. Also, no, you won’t start out with the exact amount you want in savings. But you can work towards it!

      3. Anon Today*

        It is hard. However, when you aren’t a w-2 employee it’s even more critical that you have more in savings. If I am laid off tomorrow at my W-2 job, I would be paid out vacation time and I would probably qualify for unemployment.

        As a freelancer if business dries up you are in a much tougher spot. The few people I know who freelance live way below their means (down to living with parents, renting a room, etc.) to save up their cushion.

        1. Annon for this*

          Freelancer friends have told me that they are not eligible for unemployment in our state. Hence, the larger savings is a good idea.

      4. sam*

        A year is certainly difficult to achieve, and to achieve quickly, but I would definitely recommend it (if possible), even if it takes a long time to get there.

        I had a job that paid well, and then I got laid off during the financial crisis – I was unemployed for *two* years. It was only because I saved enough money to live for that entire time that I didn’t have to do something drastic like sell my apartment.

        Obviously budgeting and cutting expenses also helped – I actually sat down when I got laid off and (yes, using mint!), figured out that with my monthly, expenses, the money I had in the bank could last for two years. At the end of the two years, I still had more than half of my savings – This budgeting was also extremely helpful because I ended up taking a job that paid less than my former salary.

        (some things were really easy to cut out – I was clearly not wearing dry-cleanable clothes while just puttering around my apartment or the neighborhood instead of going to work at a law firm!, and I obviously had time to do things like cook more when I wasn’t working 16-20 hour days. I also pretty much stopped taking taxis and learned what the subway was like at 2 in the morning – a behavior that has stayed with me to this day – I RARELY take a taxi (or car service) unless I’m going somewhere the subway just…doesn’t go. But other than a friend’s wedding that I went to using miles, I didn’t travel for the entire time, despite obviously having plenty of free time, and I rarely shopped for anything ‘frivolous’ – my dad finally bought me a new cellphone because he took pity on me at one point)

        Also, on the plus side – if you end up with that much in savings and then don’t need to use it as an emergency layoff fund, it’s much easier to do things like buy a new home!

        1. Michaela Westen*

          It may be different where you live, but I always take taxi or rideshare home late at night. Walking home from the el at 2am I would be alone on the streets and who knows what could happen. Maybe consider taxis and rideshares at least for after midnight? It’s not terribly expensive and well worth it to me at least, to feel safe. :)

          1. sam*

            Oh, I would never suggest being unsafe – If I’m actually tipsy, I’ll splurge on a cab/rideshare. And I took a cab the other day in the *middle* of a perfectly nice day because I was going from a point A to B where there was simply no convenient public transit (and I was in a rush, and I was going to a fancy lunch where Hillary Clinton was speaking, so I COULD NOT BE LATE).

            But as far as safety, I live half a block from my closest subway station (which sits under the Dakota), and I’ve lived on the block long enough that even though they’d never let riffraff like me past the gate, all the doormen know me.

      5. Starbuck*

        A year’s salary isn’t necessarily the same as a year’s living expenses, though. I’ve got about half my annual salary in savings right now; with a bare-bones budget I could survive for almost a year, if I was extremely careful (and lucky). But I’m fortunate to live in an area with a relatively low cost of living… for my region, anyway.

    2. Freelancer OP*

      I actually have paid off all my credit cards. My only ongoing debts are my house and car payments, and I purchased very conservatively on both counts, so that’s okay.

      1. nonymous*

        I would say that the emergency fund size that makes sense for you is whatever is reasonable for the rest of your life + a few months of expenses as a buffer to make the decision to job-hunt outside of freelance variability. So, maybe $5K + HELOC makes sense as an emergency fund normally b/c that would cover the crappy month with major home + car repairs (my rule of thumb is to be able to pay for a new roof on short notice, but that can be a combo of credit and cash) and a few months of unemployment – Dave Ramsey recommends 3-6mos of expenses.

        And then ask yourself, honestly, how long do you expect the freelancing business to survive tough times? For some orgs that might be a year, but others it will be 1 -2 months. This last bucket of savings is not a personal “emergency fund”. It is a business expense and contributions to the business buffer really need be considered at the level of other business expenses, like web hosting and accountant fees. Depending on what state you live in and whether you’re an S-corp, you may be eligible to buy into unemployment insurance, which is an alternative to this rainy day fund – although you can earn the benefit by picking up a part time W2 job instead.

        One thing you can do right now which will not cost anything is to analyze your income through a cyclical lens, and have targets for “down time”. For example, calculate monthly/quarterly income as a rolling average of the last 12 months, so that brief periods between projects don’t freak you out unnecessarily. Compare YOY trends -there are many industries where Feb never performs the same as Nov and that’s okay. Also plan for the downtime – do you expect your business to provide 4 weeks of vacation + 10 days observed holidays? If you’ve been clocking a lot of hours, consider the time between gigs as your vacation (even if all you do is putter at home, no guilt!). A good rule of thumb is to take 4 half-days off in a 7 day period (equivalent to working 5 days/week) or cap the month at 250hrs (a FTE position only works ~170hrs/month before leave, for reference). If you’re hitting the desired working hours on a consistent basis, no worries on turning down or delaying jobs, and if you find yourself turning down jobs on a consistent basis consider building a network of referrals – trading jobs is a good way to smooth out those bumps in demand.

    3. Someone else*

      When you say “no debt” are you also including mortgage in that? Because OP seemed to say she already has one, and it’s not as though she can just instantly pay it off or practically put all extra cash toward it without creating a whole different set of anxiety. Or do you mean other things like student debt, credit cards, and not financing any vehicles, etc?

      1. Thomas E*

        In general it’s best for a freelance not to have any debt, and that includes mortgages.

        The proviso is this is an ideal to work towards; you would pay off credit cards and high cost loans first, then get a basic 3 month cushion, then a 1 year and only after that start paying off your mortgage faster.

        You probably can’t do it all at once …

        1. nonymous*

          That’s much more conservative than necessary. I mean, even a W2 earner can be laid off or face other financial hardship on short notice. In general it’s recommended that mortgage-holders plan for payments that are low enough to be affordable during periods of under employment and build up a buffer to carry through periods of no income. That cycle is obviously very different depending on employment types, but it does not mean freelancers shouldn’t buy a home unless they can pay for it in cash.

          I will say that part of why a W2 position can be attractive over freelancing is because risks are spread out over a larger pool of staff and that others are responsible for the analysis. The trade off is a good amount of autonomy and flexibility.

    4. Pudgy Patty*

      An incredibly stupid question: What FORM of money is this savings fund everyone talks about? Is it literally in a savings account, or something like mutual fund/investments?

      1. Office Gumby*

        For me and Mr Office Gumby, it’s currently a half-year salary in index funds, a quarter in CDs, and a month’s worth in a high-interest savings account. We add to each when we can.

        The index funds generate a small income. The more money we put into it, the greater the income. We aim to have sufficient to achieve financial independence (We’re Mustachians, BTW). Downside is that it’s not easy to access the capital.

        Next are Cash term Deposits (CD). This locks away our money for a short term (say, 3-6 months), but pays marginally better interest than our savings account.

        The savings account is money we can easily access. If we need cash like, today, we can get at it. Downside is that while we’re not spending said cash, it’s not pulling its fair weight in making us interest.

        A good thing we have that buffer. Mr OG’s contract is up next week and he doesn’t have another lined up yet. My income isn’t QUITE enough to see us long-term, but we’ll manage simply because we have a buffer.

      2. sam*

        I’m fairly conservative, so for my “true” emergency fund money, it goes in a ‘high-yield’ savings account. Of course, nothing is particularly high-yield these days, but you can access the money relatively quickly (it takes a few days to transfer into your regular bank account, so obviously keep enough for daily living expenses and whatever baseline you need to get free checking in there!).

        For longer term savings, it obviously depends on what sort of timeline you’re looking to save on. Office Gumby has some good suggestions for ‘short-term’ longer horizon investments like CDs and the like, which lock up your money for a set amount of time, but give you higher returns the longer you lock it away (these can also be really good for helping force you to budget if you get large payments several times a year, rather than a ‘steady’ income – because you literally can’t touch the money, you can lock away the money you know you’re supposed to save until later, and then you can’t accidentally spend it – I had a friend who used to do this when we were in college with his student loan money for living expenses – they’d give us all of the money at the beginning of the year, and then we’d have to budget for the whole year with it. He’d take half the money and put it in a 3 month CD, knowing that was his “spring semester” half).

        If you’re looking at MUCH longer horizons, you could look at tax-deferred IRAs, but you can’t pull money out of those until you retire.

  8. Anon Today*

    Honestly, I tend to think when you are a freelancer or you work on commission that you really need a least a year’s worth of expenses in savings to minimize the stress. Because everyone who I’ve met who is in that situation goes through at least one extended dry spell. To know that you can weather that sort of extended dry spell anytime it occurs I think is critical.

  9. Logan*

    Agreed that savings are a big part of this. Have enough to keep you afloat for 6-12 months, or even longer if possible (I have enough saved for 12 months, although it’s in the equivalent to a US Roth IRA as that is easy for me to access and pay back, unlike more traditional retirement savings).

    I have also heard this suggestion, and I think it’s a good one (I have a salary, so I don’t do this now, but I like to keep my options open so I have remembered this advice):
    Have two budgets. Make the first one based on a lower value of your expected earnings. Or, do the opposite, and make a budget based on the minimum on which you need to live (home costs, food, transport) and then know that that’s your worst-case scenario – if it looks like you will make less then start looking at other options for work. But it makes more sense to take your lowest expected earnings, make a budget based on that, and then make a second ‘more fun’ budget based on an average income (if this were me, then I wouldn’t make a single budget based on your average income, because that’s 50% likely to fail (the definition of ‘average’) which is more stressful). That second budget should include a fair amount of savings, at least at first, for those leaner future years (or maybe look at paying down the mortgage or similar). But this is also where you can look at treating yourself, especially if you need to treat yourself kindly to balance out the busy overworked times.

  10. Liz*

    Fellow career freelancer here, but I don’t make anywhere near the kind of money you make, even in bad years for you / good years for me! But my work/life balance is heavily weighted towards life (which is why I’m a freelancer). This only works because I am naturally thrifty and I live the same thrifty, budgeted life regardless of if it’s a flush month or a dry month, so I have substantial savings. Since your dry years are still at a pretty reasonable salary level, consider treating that low level as your all-the-time income (as you already do regarding your mortgage), with no significant variation in spending patterns when it happens to be a flush year, and put all the extra in the bank? Once you have savings that you could live on for a long time, the dry periods will be much less scary.

    Also, if you are in the USA, call your reps and engage in lots of activism in support of the ACA, because we will all lose our lovely freelance careers if we lose the ACA.

    1. Falling Diphthong*

      Or depending on your own brainweasels you can split the extra money, so most goes to savings but some to an “It’s been a good year so I can splurge on XXX” account/envelope.

      1. Lora*

        Yes. When I was consulting I had the Break Glass In Case Of Emergency fund vs. regular savings cushion vs. Mad Money. When the Mad Money fund got fat enough to take a real vacation, it did wonders for the brainweasels.

        1. mrs_helm*

          Ok, my online bank lets you subdivide savings into named accts. I am totally setting up the 3 you just named. Because right now we just have 1, and we tend to treat it as either Mad Money or emergency, so we never have a cushion!

          1. Amber T*

            Can I ask which one you use? I’m curious if more than one does that – mine does it too, but it’s been glitchy and I’m not thrilled.

    2. famous internet cat*

      This is really great advice. I’m also a freelancer, and I don’t do as good of a job at saving as I should, but I just finally got all my debts paid off (student loan, car loan, all credit cards!) and generally like to have two or three months’ savings in my bank accounts just in case.
      My other piece of advice is to focus on high-paying jobs and to not let the threat of a dry spell trick you into taking jobs that pay too little for too much of your time. A few years into my freelancing career I was finally able to start being picky about my clients, and it made all the difference in how secure I feel — and how much availability I have to pursue new pie-in-the-sky projects or hop on board with a new dream client.

      1. Your Weird Uncle*

        Congratulations on paying off those debts! You should be very proud….that’s hard to do!

    3. Freelancer OP*

      I’m fortunate enough to have non-ACA insurance, but I am very active in those efforts, because I’d really like to trust that I could eventually move to other, better insurance!

      I’d also really like to know why the “party of business” so vehemently opposes ACA when ACA makes it possible for non-rich-people to start their own businesses or be self-employed. I’m supposed to be pulling myself up by the bootstraps, right? So why do they want to cut the bootstraps??

      Okay, I’m getting political and will knock it off.

  11. Mina*

    You Need A Budget – a cheap budgeting app that changed our finances and helped save my mental health. Savings will follow!

  12. Falling Diphthong*

    Seconding to live at the low end of the range and save. Savings gives you flexibility in the dry spells or when deciding this particular dry spell is a sign to look for something less stressful.

    (And throughout my freelancing, my husband has had a job with a steady paycheck. Initially less than what I made, later more. Typed not as life advice, but as context that for some freelancers the family income and the erratic freelance income are not synonymous, so be wary of comparing yourself to people whose circumstances are different.)

  13. Data Miner*

    My husband is a freelancer, also in the creative industry for about 15 years now. What’s helped him (and by extension, us) is to get a job on retainer that provides ongoing ~10 hours of work per week. This adds stability to his schedule and income.

    He also suffers from being a workaholic and not having a healthy separation of work and home life (since he works from home) but now that’s he’s more comfortable knowing he has a safety net of savings and the retainer, he can be more selective about jobs that he accepts and doesn’t work 60+ hours a week, but it’s taken him about 3 years to get to this place.

  14. Mom MD*

    Save up a year’s salary on your lower end budget. Enough to pay your bills with no heavy frills. This gives you plenty of time to find a paid position or solicit more freelance work. I’m the type who likes to be busy so working 50 hours a week freelance wouldn’t bother me, but more than that and there’s no life balance. Pay your mortgage off during the high times and that’s one less big worry.

  15. Chai*

    There’s sure to be lots of great advice on making plans and budgets as a way to combat the uncertainty, but I also want to throw this out there: if you’ve followed all the practical advice and are still experiencing freelancer terror that is affecting your quality of life, another option is to see a professional and enlist their help in developing strategies to cope with the anxiety.

    (Note: I’m 100% not trying to diagnose OP or anyone else who experiences these feelings, and even people who don’t have a diagnosable anxiety disorder could benefit from professional assistance)

    1. 5 year freelancer*

      Totally agree with this. The scarcity mindset is learned, and we often learn it from early life and career experiences. It can tank your freelance potential unless you actively train your mind to work in an opportunity mindset.

    2. Freelancer OP*

      I do visit a mental health professional about anxiety, but could probably use some CBT or something to come up with more concrete tools. There was a period when I was first out of school, where I was both flat broke and extremely sick, and my parents’ marital woes meant I didn’t even get their attention, much less real assistance—and that period was really, really scarring for me. The “scarcity mindset” from that time definitely interferes now.

      1. Scubacat*

        CBT is fantastic!

        I signed up for a few weeks of CBT when going through a period of anxiety that wouldn’t quit. The tools that I learned still serve me well years later.

  16. The Photographer's Husband*

    As my name might imply, my wife is a photographer (of the wedding variety), so we can sympathize with this. She does struggle periodically with wondering if she’s ever going to get an inquiry again. In the past few months though, I’ve noticed that she has really put a firm line in the sand against having a ‘scarcity mindset.’ She refuses to believe that she’s going to be poor and scraping by for her whole career, and having a more positive mindset I think helps her business prosper. Not quite ‘just think positive and the universe will provide,’ but kind of similar.

    The book she reads that helped her through this was ‘You are a Badass’ by Jen Sincero, and ‘You are a Badass at Making Money’ also by Sincero.

    Aside from that, our financial planning has us living day-to-day off of my reliable salary, and using her variable income for saving for a house, trips, big purchases etc, so that’s worked out fairly well for us so far.

  17. 5 year freelancer*

    I’ve struggled with this constantly! Until I decided to let go and let God.

    A healthy savings and a back up plan (or just confidence in where you would pursue a FT job) is very, very helpful. But at a certain point — once your skills have proven valuable and you’ve established you’re the caliber freelancer who can get work — you have to trust that this is what you’re supposed to be doing and the work will come.

    I can’t tell you how many times I’ve had this fear and clicked around FT job listings only to have lucrative projects come in out of the blue. I’ve also managed to squirrel away for two maternity leaves in two years freelancing, which came/comes with A LOT of fear until I sit down and actively affirm my “let go, let God” mentality.

    If you’re meant to do it and you’re working hard within a reasonable schedule, you’ll gain a lot from actively trying to shift to the trust perspective. Otherwise you’d be making a career change in fear and find yourself locked in a cubicle, making half what you’re worth, wondering if you should have just stuck it out.

    1. 5 year freelancer*

      It’s a similar thing to being generous with your network. Sure, you could grab and squeeze every opportunity that comes your way even if it doesn’t feel like the best fit. Or you could pass it along to a fellow freelancer and build your network equity. There’s a lot of risk for that, and you have to trust that the principle of the thing will see you through.

  18. Julia*

    I was an IC for years, now FTE consultant. But I’m in a very volatile industry, and the opportunities for my specialty are drying up.

    The first time I was out of work for 3 months, I nearly had a panic attack when I went grocery shopping. I literally had to hold on to a soda display until it subsided and I left without purchasing anything. Not even getting unemployment benefits made things worse.

    While I had/have a savings account for buffer, it isn’t as high as I’d like it to be. Now this may sound silly, but I decided to become a low level prepper. I have a fair amount of canned goods stockpiled, and buy a LOT of things in bulk. I can go without buying toilet paper for months.

    I have a deep freezer (non-frost-free) and went from buying 1/2 cow to buying 3/4 cow. I have enough protein to last me a year. The non-frost-free means the meat will stay good for over a year too. And… it’s ‘fresh’, local, pastured, with organic supplemental hay/straw over the winter – coming in at less than $8/pound!

    I rarely run out of necessities. When I buy toothpaste for example, I wait for a sale. I’m not an extreme couponer, but with CVS I can get things pretty cheaply/free. I just ‘restocked’ with 2 tubes, and I’m back up to 4.

    My thoughts were that I could pay the minimum on credit cards instead of paying them off, I can pull together enough money to pay for my car and insurance, and worst case, I can pay off my house from my IRAs (not that I’d want to do that!!).

    So food was the only variable… but now, I sleep without worries. I used to have a paid off car – it was 14 and running well. Now my sister is driving my old 2001 Toyota. I’m on my 2nd lease because I was undecided about which car to buy. Once this lease is done, I will probably buy this car and keep it another 10. Life is beautiful without car payments.

    I’m not sure if any of this helps, but doing a little prepping makes sense financially too. Life is more convenient since I can ‘go shopping’ in my basement. While I don’t expect society to collapse, I came close to a financial armageddon myself!

    1. Starbuck*

      This is also just a smart practice if you live in an area prone to natural disasters. It’s a good reminder for me to get an earthquake kit together, already.

  19. Cheeky*

    I have freelanced, and all I can say is that it taught me that the stress of freelancing is unbearable for me. The financial uncertainty is more than I am willing to deal with.

    1. SoCalHR*

      I agree with you – I’ve been considering a freelance set up, but the uncertainty is my main barrier to entry. I save well and live below my means, so its not as big of a risk financially as it could be, but the general uncertainty would be hard.

    2. ragazza*

      Same. And as much as I complain about being in an office, working at home alone all the time is not for me either. I’ve realized I need the structure and security of a full-time job, but it has to have some flexibility as well (some working from home, being able to come in later/stay later, take off occasionally for doc appointments, etc).

  20. DouDouPaille*

    When I was a freelancer I almost always had a steady part-time side job so that I always had at least some income, even during down times. If you don’t want to be continuously employed in a side job, consider something seasonal (ie retail work during the winter holiday shopping season, or a summer camp job during the summer).

  21. CustServGirl*

    I’m not normally a preacher when it comes to money (My own budget could use some serious work) but I’d give Dave Ramsey a listen or read! He has great advice (caveat: obviously he’s not perfect, some people take issue with some of his advice, YMMV). I’d focus on maximizing your savings and any secondary sources of income you may have- put as much in savings as possible, meet with a financial planner and invest, etc.)

    Also, take a breath. Even if your industry dried up over night, more than likely you would be okay. It sounds like you have quite a bit of work experience and know how to work hard. Anxiety is just part of freelancing, but there are so many perks to it as well (as you know!)

    Good luck!

  22. Natalie*

    I’m not a freelancer but I was raised by them, and the first step is definitely savings. A line I’ve heard A TON over the decades is “pay yourself first”. Meaning save. As much as you can, at least until you have a solid safety net, which as a freelancer probably means a minimum of 6 months of income. And really look at your expenses when you decide how much that six months should actually be – it’s probably more than you think.

    On the business side of things, if you aren’t keeping track of your financials that might be helpful information. It doesn’t have to be complicated (especially if you’re just selling your time and don’t have to fuss with raw materials and such), just start keeping some data on when jobs come in and how much you make each month. There’s software (Quickbooks, YNAB, etc) that can assist with this, but depending on the nature of your work it may be more complicated than you need.

    Finally, keep in mind that people who aren’t freelancing aren’t automatically living in perfect security either. Most people don’t have any kind of contract so there at the mercy of the market. People get laid off, they have family emergencies, etc. Last year my spouse and I were about a week away from living on two unemployment checks – he had to stop working for health reasons (thankfully resolved now) and I had a scheduled layoff coming – before I was offered a good enough job. This probably isn’t as rare as you might think; outside of close friends people don’t tend to talk about their work and financial problems.

    1. TootsNYC*

      people who aren’t freelancing aren’t automatically living in perfect security either.


      I have a full-time job. I live in terror of getting laid off, bcs I’m at the top of the salary range, which makes me a target.

      And my field is shrinking. And I’m the only wage earner in my family.

      So, we’re all in this together.

    2. Turquoisecow*

      The health reasons – health issues alone can bankrupt someone who is working, full time, with insurance! And I’ve seen a number of surveys that point out that a large number of people (Americans, mostly) would be completely bankrupt or at least in quite dire financial straits within a few months if they lost their job. obviously, some of that can be mitigated with saving, so many people are really struggling with financial stability right now – and, as someone else pointed out – not talking about it.

        1. TootsNYC*

          and for some populations, there isn’t someone to turn to in order to borrow that money.
          I try to be that person for my nieces and nephews.

    1. Nonprofit pro*

      I was just about to recommend this! Lillian from the podcast also has a super great new book out that is totally geared towards freelancers : “Get your money together.” There are cat puns!

  23. Amy HH*

    On and off freelancer here. It helps that my husband has a job that we could realistically live off of when I don’t have work. Whenever I make more than expected or have a particularly high-paying gig, I stash the money away.

    I also always have “coals on the fire” – keeping in touch with past clients, keeping a list of companies that I know work with freelancers, attending networking events, and even applying for full-part jobs.

  24. No To Xanax*

    Unpopular opinion here from a licensed addiction therapist. I consider this on-topic, because the Xanax recommendation doesn’t appear to be a joke.

    Even when taken as prescribed, benzodiazepines are extremely addictive, and withdrawing from them is difficult and dangerous. I wish advice writers were not so casual in recommending them. Lots of other options should be tried before seeking medication for long-term stress like this. (No, I am not against meds generally or anti-vaccination or anything like that; this is A Thing.)

      1. No To Xanax*

        Ok. Last time I saw Xanax recommended in an advice column it was 100% for real, and the author didn’t enjoy my (similar) comment, but did remove that line.

        Not my place to say this at all, but given the rate of benzo abuse among professionals, and how little knowledge there is in public about the risks, it would be a non-trivial public health action for you to clarify that you were joking here. You are a very respected, widely read authority about working life, and what’s reasonable and what isn’t (which is why I am a fan!)

        At any rate, thanks for reading and responding.

        1. No To Xanax*

          (Also, I’m seeing comments indicating that other readers thought this was a serious suggestion as well.)

        2. feminazgul*

          Agreed. For those looking for anxiety control, research CBD. Do not take a benzo unless absolutely necessary and PLEASE note that they are meant ONLY for short-term use. You can die from withdrawals.

          1. Courageous cat*

            I think it’s good to take comments about benzos with the appropriate amount of gravity and concern, but I think this mild fearmongering (particularly with the last sentence) is a little unnecessary too. To those of us who have genuine panic/anxiety disorders, and especially to those of us who don’t have particularly addictive personalities, things like Xanax absolutely can be the answer and can allow us to live reasonably normal lives again. I think some comments about benzos can really add to the stigma against people taking medication for their mental health, when in some cases, it’s really appropriate to treat it that way if the alternative is holing oneself up at home forevermore.

            Ok I’m done.

            1. Courageous cat*

              Ah, I see the comments below on this now – I do think this is an important thing to get across in light of all these doomsday-esque comments, but sorry to derail!

      2. Twinkle*

        I definitely took it as serious, and was concerned, so thank you for pointing this out, No to Xanax.

      3. Clinical Social Worker*

        I am also concerned about this. Even when it’s not abused and taken as directed Xanax and other benzos make anxiety disorders worse because of the dependence issues. They are unique in this way (unlike SSRIs and other medications that treat anxiety disorders that actually alleviate symptoms because they don’t reinforce escape behaviors).

        I would gently encourage you to remove this from your advice.

  25. Lady Jay*

    I’m not a freelancer, but I am in higher ed, so there’s still a lot of uncertainty.

    One thing I’ve found to be helpful is naming and identifying problematic thought patterns. E.g. I wake at 2.00 AM picturing the very worst scenarios, being unemployed or tenuously adjuncting into my 60s, and it’s easy to slip into panic. I can ward against the panic a little if I recognize that I’m catastrophizing; speaking back to my brain robs the anxiety of some of my control. There are other problematic thought patterns, of course; and the ones that I’m prone to are not the ones that other people are prone to. But I think the overall practice of knowing what traps to avoid is important and helpful.

    1. Chameleon*

      Yes to uncertainty of higher ed–I was literally just notified that I have a job for the summer, and the class starts Monday.

      In my case I have a spouse with a steady paycheck, which takes a lot of the terror away but there is def. always the thought “what if I’m still only making this amount in ten years and how will I ever be able to retire.”

      It does actually help me to visualize the bad scenarios and think about what good might be there. Like, if my class had been cancelled, I would have been out a good chunk of money–but I would have had the time I’ve been wanting to get my house in shape so that I wasn’t as stressed when I started back up in the fall.

      1. Lady Jay*

        Eh, I think there’s good ways and bad ways (at least for me) to approach positive catastrophes.

        Some days, I can wind up imagining these highly unlikely and terrible situations: that I’ll finish my PhD and be unemployed and living in a tent on the side of the road, adjuncting on the poverty line for years and years. The truth is, this is the very worst case scenario, it’s a lot less likely that this will happen then literally any of the other outcomes, and it’s important for my mental well-being to notice that I’m catastrophizing. But that doesn’t mean I don’t plan for contingencies. So the scenario that I don’t get a TT job is very real, and I plan for that, make a Plan B and a Plan C and whatnot. The planning will (hopefully) keep the worst nightmare stuff from coming true.

        I was literally just talking about this with my therapist this morning. Planning is different than catastrophizing. It’s helpful to have a plan. It’s not helpful to fixate on the worst scenario and convince yourself that it’s going to happen (which is what I do, all too often. It contributes to my anxiety.)

  26. Persimmons*

    My spouse and I have traded off being freelancers over the years. The only way we are able and willing to make it work is when the other partner is in a stable job, making enough to meet bare bones expenses. As long as one of us has enough coming in to keep the lights on and put food on the table, we’re okay.

    Those of you freelancing solo have a level of bravery I cannot meet. (I know this isn’t particularly helpful, but I just want to convey my admiration!)

  27. Aphrodite*

    If you really prefer freelancing, really, truly, then Alison’s plan makes the most sense in a personal and financial way but also in an emotional way. Dive into it, plan for it, live it.

    For myself, I decided that freelancing was just not worth the anxiety. I returned to the workforce in a lower position but it offers all those things I now love and appreciate. I enjoy having set hours and knowing those are it; all the other hours are mine. I love a steady paycheck and no layoff worries as I am in a union job in higher education. I appreciate more than ever in these risky political times having fabulous benefits that are rarely given elsewhere other than government and education; if I don’t feel well I have nearly free access to the finest physicians and health care anywhere. I am so grateful for someone else (my employer) doing my payroll taxes. I adore having plenty of vacation and sick time. My employer contributes to my retirement.

    Sure, there’s downsides. I cannot work from home nor is my work overly interesting. I do have a new boss who I adore (and who adores me; he calls us the Dream Team). I hate staff meetings but we live through them.

    For me, the payoffs are worth it but for years I did not think so. It might be a good idea to do a Pros/Cons page each year to see if your priorities shift, especially with each (just past) year providing additional input. You may well stay freelancing and if so I hope you continue to love it and that it supports you!

    1. Cara*

      I really like this idea of doing a pro/cons page each year… so true about priorities shifting and new input over time.

  28. TootsNYC*

    My advice: Catastrophize!

    Seriously, sit down and pretend. Say, OMG, there is NO WORK ANYMORE. WHAT WILL I DO?!?!?!

    And then figure out what you would do. As if it’s real. Make phone calls; research temp agencies, etc.
    Plan it all out. Make the solution real.
    That might remove some of the terror, if you know that it’s not a disaster, it’s just a sudden switch to Plan C.

    Another possibility: Regard those fallow periods as opportunities for marketing activities, networking, extra training, create systems that improve efficiency and better support, etc. Make THOSE plans very real. Then when you have nothing happening, you can just pick up the “when things calm down” list and forge ahead.

    Also–maybe you could hook up with some sort of temp agency so that in the dry spells, you can have low-impact work, even if it’s not a lot of money. You want to be sure you don’t get so distracted that you can’t use that time to recruit new clients, improve your skills, etc.
    But just having a place you can go to do some sort of rote work might keep the anxiety at bay.

    1. A. Schuyler*

      I’m not a freelancer but I still worry that my very stable job will suddenly evaporate (probably more imposter syndrome catastrophising than any real risk). This advice seems really helpful and couldn’t have come at a better time.

  29. Lady By The Lake*

    This is so timely — I am a freelancer, have been for six years now, and I do fine. Some years have been fantastic and I’ve been able to save a lot of money and other years I’ve simply made enough to pay the bills — again, it’s fine. This morning I got a call from my primary client (95% of my work) and her new boss is worried about how much they are spending on me, so I might see a significant drop in the work I get from them. No matter how many times I tell myself that I have enough savings to live on for years (I’m moving towards retirement) and that I have other clients, and that I’ve never done any marketing and it probably wouldn’t take a whole lot of effort to pick up more work — I am practically hyper-ventilating right now that me and my cats are going to be out on the street and we will starve.

  30. Lizabeth*

    Good advice here about having a bare bones 12 month expenses saved up and set aside…

    Quarterly taxes – take thee to an accountant, if you don’t already have one!!!! They should be able to suggest a way to make them less painful to figure out. It was a ROYAL PIA to figure out when I was doing volleyball refereeing as a side gig and I was only making 4-6,000 a year from it. I didn’t think it was enough $ to consult with an accountant back then, so I managed to do it with much hair pulling.

    1. AVP*

      Another freelancer here, agreeing that you need to find a great accountant who specializes in freelance work – even better if they specialize in your industry but that’s not always possible to find, I know.

      My accountant (and I don’t want to recommend this for anyone else because I don’t understand the law at all! I was just following his advice!) told me that I could just file all of my quarterly returns at the end of the year without a big penalty after I had a decent idea of how much income I was going to file and it decreased my stress by about a thousand percent. so YMMV but a good specialist should be able to work with you and help you work through at least some of the anxiety.

    2. Freelancer OP*

      I do have an accountant, and thank god. Honestly I don’t know what I’d do without him.

      1. Willis*

        I know a lot of people have suggested a budgeting app and building savings, but you might want to consult with a financial planner too. I’ve been a consultant for 10 years or so and found that fear of work drying up kept me from making longer term investments for retirement. I met with someone earlier this year that helped me get a sense of how I should be balancing savings that is easily accessible if the consulting hits a snag, while still making longer term investments. It’s something I wish I did earlier, and helped me to consider a variety of questions I hadn’t really thought much about on my own. Your letter and Alison’s response definitely hit home!

  31. KH*

    +1 Xanax and any other medications you may need to manage your mental health, just in general.

      1. Ask a Manager* Post author

        I am, however, pro medication that might help you manage your mental health, which is what KH seems to be talking about, and I’m going to ask that we not derail on this!

  32. Hope*

    My parents and one of my siblings are all freelancers (in completely different fields). Growing up in that kind of anxiety is precisely why I *don’t* have a freelance job as an adult, but they all make way more money than I do, so I also understand it can be worth it. The biggest thing has already been said: save. Figure out a budget, stick to it, and save everything else until you have a year’s worth of savings. At the end of a particularly good year, you can reward yourself with a bonus if you want.

    Secondly, make sure you’re taking care of yourself/family. Carve out vacation time for yourself. Even if you don’t go anywhere, make sure you give yourself a week or a few days off periodically (some fields are easier to plan this around; if there’s a time of year that’s always slow, go ahead and set it aside for yourself). Get life insurance if you have dependents (I cannot stress this enough), and make sure it’s enough to cover the cost of your mortgage, funeral, and at least a year of bills. Make sure you get enough sleep. Make sure you are doing fun things with family/friends/yourself every so often (at least once a month).

    Thirdly, if you have a way of getting steady income on top of your freelancing, do it. My sibling bought a house with a room that could be rented out, and they pay about half of their mortgage with money made from Air BnB.

    Remember you’re working for yourself, and no one needs a boss who works them to death.

    1. Persimmons*

      Remember you’re working for yourself, and no one needs a boss who works them to death.

      What a fantastic line. Saving!

  33. The Other Dawn*

    This letter right here is what stops me from trying my hand at consulting. I’ve thought about it from time to time, but I’m not sure I can stomach the stress. And I definitely don’t know how to get started in consulting. The rug got pulled out from under me this week when it was announced our company is being sold, so I may need to think about trying this. The reality is the buying company’s operations are an hour away without traffic, so even if I got an offer, I’m really not wanting to do that commute (the traffic is horrible).

    1. MariaTeapot*

      I’ve been nothing but freelance for a long period of time (school). It’s absolutely exhausting.

  34. Hannah*

    Maybe it also helps to remember that even us cube rats don’t have certainty. Firings, layoffs, etc. make it so almost no one has a certain future. I too play the game of “if I were laid off tomorrow, what would I do?” My income could disappear next week and that would be that.

    I don’t think there is any magical way to totally get rid of that feeling other than acknowledging it is there and purposefully not letting that fear completely dictate how you spend your life.

    I used to feel this way about money–every dollar I spent I had a nagging thing at the back of my head like “but what if I need it in my savings for some catastrophe in the future!” I had to sit down and make a decision about how much money I was going to let myself have so I could have a life today, and still feel confident that I was putting the decided-upon amount into savings. Maybe you can do that with your work, ie “I am willing to take on 3 projects at a time, and that is what I have decided will be OK in the long term” (or however you choose to structure it.) Then you can put aside the nagging feelings of “but I should be working 100% of the time!!” Because you have already decided on a plan and are moving forward with it.

    1. Lil Fidget*

      Yes, I once heard someone on Captain Awkward talk about “the load bearing wall of my anxiety” and I’ve realized that’s what money is to me. I worry about it because I’m a worrier and I’m going to worry about something. If that risk magically disappeared, I’d shift to worrying about the next biggest thing – whether that’s my health, my relationships, my cat, whatever. It’s only somewhat actually about the money itself.

  35. Safetykats*

    You don’t say what you’re tax status is, but certain not look into creating a LLC and whether that would save you anything. Also, don’t look at the monthly business income as your salary. Figure out what salary you can reasonably pay yourself every month (from business savings in months with no income). If business savings gets big, maybe give yourself a raise of a bonus. Most businesses have invoicing lags and variable income; they don’t manage that by failing to pay their employees. You should be set up soon you don’t manage it that way either.

  36. Alternative Person*

    I’m more of a regular contractor than a freelancer but a few things that work for me:

    Having a regular day off. A day where I don’t have to engage in the sprawling wrestling match known as commuter rush hour and I can lay around in my pajamas, indulging in nice cheese helps keep me on an even keel.

    Having a flexible ceiling for the amount of work/hours I do. If I reach a certain level, I ask myself if I really want to do the job/if the effort is worth the reward. Sometimes it is, sometimes it isn’t.

    Setting a minimum pay per hour rate guideline. It’s not hard and fast for me but good contracting firms make an effort to keep their reliable workers happy, so picking up an inconvenient cover shift usually repays itself with a couple of nice afternoon jobs.

  37. Liz@ChiefMomOfficer*

    Not a freelancer, but lived through a period of years of financial difficulties. For example, my husband lost his job in the Great Recession, he went into septic shock & nearly died, unable to work for over a year; and he’s had to stop working due to medial issues. He’s currently a stay at home dad. So I’ve done a lot of dealing with variable income.

    -Definitely echo the tips above about setting aside a large emergency fund. 12-18 months expenses is usually recommended for folks that have a high risk of being out of work

    -One tip I’ve often read is to give yourself a base monthly salary. Take the extra above and beyond that and put it into an account. When your income dips below that for the month, withdraw the extra you need from that account. It will feel like your monthly income is steady.

    -Come up with an emergency plan. I have a plan that outlines what expenses I would cut in the short term and what accounts I would take money from (and the order). Doing an emergency “dry run” on paper can help you feel more prepared, and give you something to review if you’re feeling stressed.

    Best of luck!

  38. WolfPack Inspirer*

    first off, if this is your ideal job other than the anxiety, then there’s nothing wrong with finding a therapist or counselor (or yoga teacher or guru or religious leader or smart app or…) to develop some coping techniques that work with your lifestyle and mental emotional style. I’m very logical and I find cognitive behavior therapy extremely helpful in reframing my thoughts and redirecting my panic spirals. That, or anything else that works for you is good.

    Also, there’s nothing wrong with xanax or klonopin or zoloft to help keep
    the brainweasles at bay. Better living through chemistry, y’all.

    1) budget plan. I love the YNAB guy because he is the least judgmental and clearest/simplest plan out there. I get real huffy when people tell me what I “SHOULD” be doing with my money and he never does that; just helps explain how to break things down so you CAN spend on the things you want to focus on. You may also find a bit of peace either hiring or consulting with a tax prof or accountant who specializes in freelance and unevenly distributed incomes.

    2) savings plan.
    2.1) 1 year emergency fund in some safe mutual funds or bonds or something so they’re making you a bit of money while they’re sitting there.
    2.2) 3 month or 3,000 in a savings acct that you literally can get to in 30 minutes if you need it. I like the 360 accts with Capital One – they’ve always been good to me and the interest rates are better than with physical banks.
    2.3) ready cash – i keep at least 1000 (used to be 500) stashed in my house for actual real imminent emergencies.
    2.4) if you use any of these, you gotta replace them ASAP.

    3) retirement. be generous when you’re in a good year, at least contribute something in a slow year.

    4) customer service. you say you hate turning down jobs, but have you tried pushing back a little regarding timelines? If you’ve got jobs out the eyeballs in April, but your June calendar is a wasteland, ask the client if they have any wiggle room in their timeline “id love to work with you but this is a very busy month for me. Any way you could push back to x?” If they say yes, YAY! If they say no, then you can say “i really like you as a client so i can try to fit you in, but that’s going to be an x charge over my regular rate. Are you open to that? If not i can recommend you to Joe or Syrah” this either gets you a more balanced workload or gets you more money (or they cheap out but at least remember you were honest and suggested good alternatives for them).

    Good luck!!

  39. Secretary*

    I don’t have any advice, just want to say to the LW good for you! It sounds like you do really well in your work and that you enjoy it. Not everyone is willing to strike out on their own and be their own boss, and I respect you for that. You got this!!

  40. Aphrodite*

    Here’s another suggestion: overpay your utilities every month, even if it is only by five dollars. I tend to have a minimum of two months, and I prefer four months, of prepaid payments for my average bill for the landline phone, gas and electricity. (I do not have a cell phone nor do I pay water and trash.) It’s very comforting to me to know that should something happen I can let those go for a while and still be paid up. People might say that they utilities are making money off my money (and technically that’s true but, really, it can’t be more than pennies). I don’t care. I see it as valuable to me and that’s what matters. Emotional financial security is as important as anything else.

    And somewhat adjacent is to stock up on basic supplies when you can. I have an abundance of toilet paper, deodorant, paper towels, bar soap, shampoo/conditioner, toothpaste and toothbrushes. It’s nothing more than I can easily store but it amounts to about four-six months’ worth.

    1. Kim, aka Ranavain*

      I love this!

      When I still had the normal job I would intentionally over-withhold on my taxes for similar reasons. I don’t really care if the government is getting an interest-free loan from me, because that strategy has kept me solvent and allowed me to save better than anything else I’ve ever tried. People are like “oh, you should take that money and invest it instead.” Like, oh, you want me to spent countless hours researching options, figuring out how to invest it in ways that get a decent return while also giving me options to make that money liquid if I need to, all for maaaaaybe $100 of return? And that’s *if* I successfully sock away that money each month into wherever I’m investing it, which again, I’ve never successfully done?

      Sometimes, good financial advice isn’t about the mathematically best possible return, it’s about figuring out what actually works for you and makes your finances more solid and stable, given your current financial situation and options.

      1. Natalie*

        Absolutely. It can be really attractive to try and optimize to the hilt, but for the average person the best savings plan is *one that you will actually do*.

      2. Aphrodite*

        So true! I also intentionally do not take any allowances on my W-4 form so that my employer takes the maximum out. I agree that every single financial advisor I have ever read has said not to do this, to let let others “profit” off you. Well, they can do it their way but I will stick to my way. Having those “over balances” in basic supplies, utility providers and taxes makes for enormous (and comforting) emotional security even when, like me, you have damn good job security because other things like deaths of family members can throw things off and if you have these all laid in then ignoring or forgetting them for a while is just fine.

      3. Michaela Westen*

        This reminds me of the concept of risk tolerance that I learned in the 90’s.
        When investing you don’t just look at what would bring a high return, you look at the risk and determine how much risk you’re comfortable with.
        I over-withhold also so I won’t get hit with a tax bill. Well worth it, especially in the early days when I could barely buy groceries!

        1. TardyTardis*

          And risk tolerance can vary. Because we had the security of my husband’s retirement plan, I was able to skew my 401(k) choices to higher risk/higher return as if I was going to retire several decades down the road instead of less than one (and this when the Dow was 6,000). Well, it all worked out nicely, but I never would have done it if PERS had not been the backstop.

    2. TootsNYC*

      And somewhat adjacent is to stock up on basic supplies when you can. I have an abundance of toilet paper, deodorant, paper towels, bar soap, shampoo/conditioner, toothpaste and toothbrushes. It’s nothing more than I can easily store but it amounts to about four-six months’ worth.

      I got into a conversation on an organizing forum with a woman who is the “home economist” in her family. She has gotten really deep into it–she grinds her own flour, for example. It’s her full-time job, managing the most cost-effective way to handle their family expenses.

      She pointed out this: If you buy something (that you truly need and will use) at half-off the price you normally pay for it, you have essentially doubled your money.

      I paid my mortgage one full month ahead, so that if I forgot to mail the check on time, I never got a late fee. And then I also always rounded up to the nearest $50, and wrote “excess to principal” on the check.

      I also handled some money anxiety by “hiding” money somewhere. One stash in a separate bank, and one literally hidden in my house. It helped me so much to know that there was money there.

      1. Traveling Teacher*

        Yes, that concept of buying “sale” items only when it’s an item I already use is what has turned sales from stress-inducing occasions where I wonder, “Is this really a good deal?” to knowing the price I pay for an item vs the sale price.

        In that case, though, I have to retain a scarcity mindset by keeping the extras in a separate place so that I don’t over-use the item because of an “abundance” mindset!

        If I’m tempted to buy coffees, drinks, or food while I’m out, I stop and picture counting out that money physically. Then, if that doesn’t do the trick, I pull out my monthly “fun money” budget (40 euros). Do I really need a 4 euro coffee, or would I rather save that to put towards a book or kitchen item that I actually *want* and have been considering purchasing?

    3. CDM*

      And similarly, you could pick up an occasional GC to your grocery store when you shop and have extra cash flow available. Check on expiration dates and maintenance fees first. Emergency grocery funds that can’t easily be converted to other purposes.

      If they expire (which doesn’t seem to be common anymore) you can use the oldest ones in the same transaction as buying a new one. Take an expiring $20 GC when you shop, and buy a new $20, or $40, or $50, depending on cash flow.

      1. TardyTardis*

        When I write a check, I round up to the next $5 (which makes it easy for me to subtract while at the store), which means over time I bury a fair chunk of money in the checking account–which has come in very handy every once in a while.

  41. Gumby*

    Can you give yourself a salary? Put income into an account that you generally don’t touch except to give yourself monthly (or weekly – whatever) “paychecks.” Then do your living out of that second account. In the good years you will build up cash reserves and in bad you might spend it down some but your day to day living expenses are more predictable.

    Also, I hadn’t realized you had to pay quarterly taxes based on guesses about the future. I had assumed you paid based on actuals for the quarter because the government didn’t want to wait 12 whole months to get their share. I mean, they take my taxes twice a month but it’s based on what I have actually earned.

    1. KAGE*

      The IRS is always guessing – even the taxes on regular paychecks. The amount of that regular payment is based on your best-guesses for how your final income/tax situation will end up after 12/31. The guess is just made when you fill out your W4 (so maybe once/year) and so is not quite as risky as the quarterly freelancer payments. But it ends up being the same if you guess wrong – you end up either with a refund or payment (and potentially interest) due each April.

      1. TardyTardis*

        We got whacked big time one year because we didn’t realize how much of our Social Security was going to get taxed (everything else had proper tax withheld). Ow ow ow ow ow! This last year, I had the feds take out some out of my Social Security, and we were a lot more even, while next year we’ll be fine.

  42. Ann Perkins*

    I work in a commission based industry and a common method of giving yourself more stability is to pay yourself a set salary. People will set up a separate business account, get it healthy, then decide they’re going to pay themselves X amount per month as personal funds. If business is going consistently well year over year, they give themselves raises accordingly. Taxes get paid out of the business account. It doesn’t solve the problem of the tax situation being unreliable, but it can help the anxiety of feeling like you don’t know what you’ll have in your personal account from month to month.

    1. Tableau Wizard*

      I am not in this type of work, but I feel like I would really appreciate this type of managing the funds. Thanks for sharing.

  43. Granny K*

    I found that getting a finance guy and sitting down with him to look at EVERYTHING really helped. You might be surprised at how much you’re worth.

  44. LuckySophia*

    OP, after 20 years owning/managing a small creative agency, I’ve spent the last decade in the same situation as you — as an independent contractor. With the same kind of “feast or famine” cycles. A couple words of advice:

    (1) I heartily second Alison’s advice to SAVE, SAVE, SAVE. The more nest egg you have built up, the less Xanax you’re going to need … and the more confident you will feel about refusing to take on “unreasonable” levels of project overload in the future. ALSO, over the years I recognized an unexpected benefit of those “feast” cycles: Not only did they provide me with extra income, but also — when work is running me ragged, I just don’t have the energy to go out and spend $ on entertainment, or retail shopping. So during those extra-busy times at work, I not only make more $, I also spend fewer $. Which accelerates the whole savings process a LOT.

    (2) Remember they ARE cycles, which means neither feast nor famine is “forever.” It really helps if you can re-frame your attitude to see the good in each. When things are too frantic, remind yourself of the benefits (you’re building client loyalty AND your nest egg of savings!) and also remind yourself that somewhere down the line you WILL get another slow period to let you recharge. Which is NOT a bad thing! Conversely, when you are amid famine, look at it as a “gift from the Universe” — the gift of time…time to devote to your health, or home maintenance, or to friends/family/fun — all the stuff that those “feast periods” often cheat you out of.

    And about those quarterly taxes: my accountant and I make our best guess at the beginning of the year, then in June (yes, that’s on my list for this afternoon) I scramble like mad to pull together all the data for the first half, so he can advise whether my estimated tax payments for the last 2 quarters should be increased, decreased or kept the same. That also gives me a general sense of whether I will need to accelerate or slow down my invoicing, and/or my business spending, during 3rd & 4th quarters.

    Working as an independent/freelancer can be stressful, for sure, but for me –being able to do what I love, and love what I do, is so worth it!

    1. Ali G*

      I came to suggest a tax accountant. For a few hundred (100% tax deductible BTW) dollars per year, let this be someone else’s problem to figure out. You might have to get the info together and maybe do the actual filings, but get a pro to do the hard work.
      Just as an aside, I took a course led by a tax accountant that specialized in 1-person businesses. He had all sorts of strategies for limiting your tax burden, some of which also doubled as retirement savings. He also said that the penalties are fractions of %’s on the taxes you would have owed and sometimes, if your income really varies that much, just don’t pay them and take the penalty of a few hundred dollars. This is not meant to be advice you should take, just telling you that there are people out there who can help you with a plan that is right for you without breaking the bank (also most of the consultants/freelancers I know don’t pay quarterly taxes – they just pay the penalties).

  45. Victoria Nonprofit (USA)*

    I have not ever worked for myself, and this is why. I live with this kind of anxiety even while having a salaried job with a regular paycheck — because that paycheck could go away tomorrow, too, and there aren’t “up years” during which I can sock away extra money. (I’m fine, financially, and we do save money, and I don’t mean to say that what you’re experiencing isn’t importantly different from regular financial anxiety — I’m just saying that I feel you so hard.)

    But I’ll say that so much of what you’re writing about resonates with what my team is experiencing with regards to our program funding. We do consulting work to generate additional revenue (because there are always gaps in our budgets), and we can’t figure out how to get off the treadmill. Spending time on the consulting projects detracts from our ability to run our programs well (and fundraise well for them, which could alleviate the need to do the consulting work in the first place). I literally just came from a meeting where we talked about it.

    I don’t have answers. But I’m eager to read the comments that come in here and think about them with an organizational lens.

  46. Michaela Westen*

    No to Xanax.
    ~2 years ago my primary prescribed me some Xanax and told me she took it to sleep. I tried taking it just on weekends, which is when I was most stressed.
    My therapist and acupuncturist both warned me it’s addictive. They both said they had seen people get addicted and have a hell of a time getting off it.
    I only took it 2-3 times because it upset my stomach (probably the corn starch) and after the warnings I didn’t want to. I tried Lexapro which made me feel good emotionally but had endocrine and hormonal side effects so I stopped that too.
    Now I take an antihistamine and use sleep hygiene to sleep, and exercise. :)
    Meanwhile, my primary lost her mind and I had to stop seeing her after 18 years. Don’t know if it was related to her Xanax use.

    1. KellyK*

      I hope this isn’t too much of a derail, but it seems to me that if you have a mental health issue (or think you might), it’s worth seeing a psychiatrist if at all possible rather than getting psych meds from your primary. This is probably true of a lot of medical specialties. One of the things I really like about my current primary (a PA) is that she’s more than willing to admit if she’s out of her depth and recommend that I see a particular type of specialist for a given issue.

      In terms of anecdotes about Xanax, I had an as-needed prescription for it for years, it helped with the panic attacks, and I never had an issue. I also took it very rarely, and it wasn’t even suggested as an option until I’d already done years of therapy and was also taking Lexapro.

      1. TootsNYC*

        yeah, I wish I’d done that–gone to a psychiatrist for the medication issues, instead of my primary

      2. Clinical Social Worker*

        For many, seeing a psychiatrist is not possible due to limited availability.

  47. Nanc*

    Full disclosure: not a freelancer, but several family members and friends have been–one for nearly 40 years (pre-internet, imagine being a freelance writer pre-internet!)

    Some things they do:
    Figure out your slowest season–if you’ve been at it for at least 5 years you may see a good pattern. Once you’ve found a pattern, think about short-term opportunities available locally. Always low on work during the county fair? Get a temp job there! Selling tickets and seeping grounds aren’t horribly exciting, but you can always put those $$$ right into savings. Slower in July and August? Short-term job at day camps, parks and rec, hotels, tourist attractions, etc., with the caveat that those places may want a seasonal commitment.

    Have one low-hour permanent job. Not always easy to find, but my neighbor is the Saturday receptionist at our local chamber of commerce. We’re a tourist town so they like to be open on Saturdays for 5-6 hours, especially during the summer. She also subs on weekdays if it works in her schedule. My retired school teacher cousin works the after-school program on Friday afternoons as that’s when they have the most staff call outs. He also does food deliveries for a couple of local pizza places on holiday weekends. He also works as a testing proctor for the local university–gets a per diem to supervise folks taking all kinds of tests.

    Temp agencies: might be harder to work, but if you’re open to be the person taking the one day jobs where they just need a body to answer phones or greet visitors.

    Do you have any sort of skill you could teach? Say at a local parks and rec or continuing education program? Or online at something like Ed2Go? Knitting 123? Cut-up Poetry (the most popular class at our local senior center!)? How to sew on a button? Make a lavender sachet? Tie your own flies (I took a class on this once on a dare and while I never fished it was a lot of fun!)?

    Good luck with finding something to ease the anxiety. I think I can speak for AAMers when I say we’ll be waiting for an update!

    1. TootsNYC*

      also–once you identify that fallow time period, make a solid plan to use it to grow or manage your regular business

  48. Julie Van Keuren*

    This letter writer described my situation exactly, and I just try to enjoy the “feast” periods, because they mean I can also enjoy the “famine” without freaking out. It’s just the nature of my work, and I roll with it. The benefits outweigh the uncertainty!

  49. Kim, aka Ranavain*

    Oh! One piece of advice I give to clients as well as keep in mind for myself: Remember that you always have more options than you think you do. Especially if you suffer from general anxiety or depression: your brain is actively tricking you into thinking that the options are Dazzling Success or Homelessness.

    Running my own business is tricky and sometimes anxiety-producing, but I was always a bit surprised when my friends told me how brave I was for starting a business. I was just like “I mean, I have a bit of runway saved, and if it doesn’t work, I think I’m pretty employable, so I’ll just find another job. If it takes a long time to find the job, I have like 3 different retirement accounts I could rob (yay being a millenial with a new job every 2-3 years with a different type of retirement account), I could downsize into a smaller apartment, my partner could get a higher-paying job, we could move back to Oregon…” It makes it easier to be zen about things when you think truly expansively about what your options are, and not just the easy/obvious ones. If you hit hard times, you might need to make tough choices (I don’t *want* to move back to Oregon…) but that doesn’t mean you don’t *have* choices!

    1. TootsNYC*

      a note about your multiple retirement accounts–at some point, consider consolidating, because you’re paying fees to multiple places.

      1. Kim, aka Ranavain*

        Yeah, I want to, but the problem is that they’re totally different *types* of accounts, and some can’t roll into others. A SIMPLE IRA, a 401k, a 403b… but I do need to invest some time in looking into consolidating. I’m also reluctant because I’m constantly considering liquidating one of the older ones rather than roll it for a variety of reasons.

  50. phil*

    I was in the technical end of the music and TV businesses in Hollywood for years. This is an freelance business. Crews are assembled for a show and disbanded afterward. I never felt anxious because I had-I’m retired-confidence in my abilities and my relationships with producers.
    And I can echo the cry to SAVE, SAVE, SAVE. Nothing reduces anxiety like a fat bank account.

  51. HigherEdPerson*

    “How to deal with a freelance terrier…? Wait, what kind of letter is that? Oh. OH. Oh.”


    1. LizB*

      I am. freelance terrier. will provide cuddles and barks. for reasonable rates that take into account. taxes. also available for snoozles. in sunbeams.

  52. Jack Russell Terrier*

    Someone mentioned having a network of people to hand off projects to if you are over-busy. I think this can be really helpful on many levels.

    On the scarcity level it can keep your clients happy for the future. You don’t want to be so tired you’re making mistakes and not doing good work – but you don’t want to leave them in the lurch. Recommendations can make sure they come back to you next time.

    It helps to have a mindset where you can say no to a client and it works out well. There will also be times where you want to break up with a client – this is a great way to do it and keep a good atmosphere and your reputation intact. Someone who doesn’t jive with you can work for someone else.

    Talking about atmosphere – recommending someone else helps you be appreciated in your freelancing community and work will be sent your way. Overall, this helps address the scarcity mindset and the life balance idea.

    It is so important to have self worth and know what you will and won’t do and accept. My experience is that when I delve into these questions I get a kind of clarity that is rewarded.

    1. TootsNYC*

      you could also end up running a larger company! That’s what happened with the cleaning service I once looked into for my dad. This woman started cleaning on her own, needed an occasional substitute, ended up with extra clients, and bingo–she has people working for her.

  53. IT Consultant*

    AAM offered good suggestions. Here’s my strategy, from someone in the same age range and working for the past 10 years as an independent consultant:

    1) Make sure you’re charging what your work is worth (as you get better at what you do, you produce more/better work by hour, and it’s common for people to hesitate to start billing more per hour or project — I keep increasing my hourly rate and not getting a pushback; sometimes a prospect doesn’t have budget for me and that’s OK; waiting typically yields the right compensation that covers the time I wasn’t working as well).

    2) Cultivate relationships with a few top recruiters. I typically take clients from referrals and repeat business, but keep in touch with these recruiters. Only one in five projects they send for my consideration is interesting, but it’s a great “plan B” for when it’s taking long for a new gig to come up and I want to increase my income. They often need to fill positions quickly for short-term assignments and are happy to check with me to see if I’m available.

    3) I make a guess at the beginning of the year for my quarterly payments, and then readjust as things evolve. For example, I’m about to take a W2 contract (the client doesn’t want to do a corp-to-corp with my LLC, so I’ll be hired through their staff augmentation vendor for a 3-6 mo project). Since taxes will be taken via W2, I will reduce how much I submit as quarterly payments for the rest of the year. It’s fine not to do a perfect job with this calculation; last year I had to pay $25K extra taxes (even with maximum retention in my husband’s salary and paying my quarterly estimates), and the penalty fee was not a big deal — especially if you’re doing #4 below.

    4) Live below your means. I may earn anything from $80K and $160K per year, and my expenses are always below $80K (that doesn’t mean we’re frugal; we travel internationally for vacations, which is important for us, but then save in other expenses we could easily afford in order to save for retirement and to cover for the weeks or months I’m in-between projects). By now we have enough saved that I could go one year without a new contract without impacting our retirement plans. This is useful because I can often say no to projects when I’m already busy or I know the client is not ideal. Being able to do that has been extremely valuable, allowing me to accept great projects I’d have to turn down if I had accepted other work simply because I needed it to pay the bills.

  54. Apropos of Something*

    This is timely, because I just had an awesome week and got my nails done to celebrate. I then proceeded to have a horrendous week this week and yesterday I sat at my desk and sobbed while I looked at my nails, berating myself for the extra $15.

    I don’t have any good input because… well… the above story should tell you why I don’t have any good input. Luckily I have been poor my entire life and am good at it by this point. I also, like a number of other posters, remind myself of my options. I am a LCSW in private practice and if the walls fell in on my practice (which sometimes during the summer it actually does feel like is happening although it isn’t) I would be able to get a W2 job SOMEWHERE in a month or two. I have credit cards. I have relatives who could probably all pitch to help spot me a month of rent. I have such a terror of living the way I did when I was growing up that I scraped together $80 last year to buy a chest freezer, which sits in the living room of my apartment, and is full of chicken thighs. As soon as I had enough money to invest in myself, I did it with that chest freezer. Things might be bad but I buy enough food during the good times that I will not starve in bad times.

    One of the things I want to do is put together some sort of training or something (you can see how well thought out this is!) where I teach adults who were poor kids how to work past some of that anxiety. I mean, until I stop sobbing over my nails I am probably not qualified. But making the adjustment from poverty to lower middle class is not as smooth as it sounds and I want to support others making that transition.

    1. I heart Paul Buchman*

      I hear you on the poverty mindset. I have some very bad habits around money and self care that I can’t break. Don’t feel that you have to have all your ducks in a row to help others – that isn’t the case. self help can be about mutual support.

      I did something similar last year and got my hair coloured, I had some unexpected expenses and kept thinking ‘if only I hadn’t done my hair’. I mean I got it done at the hairdressers college for about $20. Realistically it wasn’t the reason I was stressed about car repairs. It is all in the mindset that I will never be good enough, nor entitled to anything. That nice things are all locked away behind a window – I can peer in but I better not get above myself by wishing too hard.

  55. GeekNVermont*

    So timely here!

    I am finishing a present contract as a data geek at a job right now. I do a lot of contract work for the past three years and this is my fourth contract. I realize I could be making “more” as a completely independent contractor but I do go through an agency (temp but have long term contracts with the government) that keeps me in the work. What is great for me, like this week coming up, is that I am able to file for unemployment in the state I live in and get it accepted. That doesn’t happen in every state but in Vermont it does. I also can still collect and accept part-time work to make that stretch further. I’m not looking forward to what my employment consultant calls “downtime” but it does put my mind at ease that I am still having some form of solid income coming in even if it’s not a lot.

    Budget. Budget. Budget. I am starting to reflect on budgeting and making sure I have things on hand for times where my pay is limited. I may not have a lot of food money for the next month or so but I cook and bake regularly now. I only have to buy SOME protein (stocked up on chicken and pork right now!) and veggies to have wholesome and healthy meals while not working.

    Side jobs- I also do Amazon Mechanical Turking when I need to make a few dollars and I do some mystery shopping.

  56. Anonymeece*

    OP, I don’t really have any good advice, but I do sympathize! Growing up, my dad was constantly worried about money because we were very poor. Even after things got better, he still constantly worried we were going to go back into poverty. Unfortunately, that sort of transferred to me and now, even with a day job, I constantly worry: “What if I need to go in the hospital? What if I get fired? I’ll end up homeless and credit ruined and unhireable!”. It sucks, and I am so sorry. Even with medication, I can get petrified by that fear.

    I wholly second Alison’s comment about savings. That really, really helps. I still worry that something major will happen and wipe me out, but as I keep putting money in, the more major the catastrophe would have to be.

    The other thing that helps me is to recognize where it’s coming from. In my case, it did take realizing, “Oh, this is totally Dad talking,” to get me to realize what was going on, and weirdly, that did help. I don’t know if this comes from somewhere, but it may be worth thinking about it – if there is a reason why you’re feeling that fear, it can help to ground it and make you look at it more logically: “This is not a rational fear, this is because of X.”

    Finally, you sound like you’re rocking it as a freelancer and a savvy business person! I’m sure you’re already doing it, but not just a plan for what happens, but for just your everyday financial health can be comforting. A lot of my anxiety came from fear because I will freely admit, I suck at money. When I asked my brother for help many years ago, he made me a spreadsheet to see exactly where my bills were and income and all that, and it helped immensely. Whenever I get afraid, I look at it and realize, “Oh, that’s not so bad. I could make it.”

    (Psst: Counselors/medication is always an option, too. It doesn’t sound like this is necessarily paralyzing, but if it’s impacting your health, you may look into talking to a trained person about it, or even possibly looking into medication. I totally get if that’s not your thing, but it is there as an option.)

    Best of luck!

  57. Crystal*

    I don’t have any advice but I just want to say kudos to all the freelancers out there. I couldn’t do it for anxiety reasons as detailed in this letter. I am always in awe of my friends who work in the industry (I live in L.A.) and have no idea when/how long their next gig will come, even if they’re successful. Sincere WOW to all of you who do this!

  58. Anns*

    The wonderful money podcast Oh My Dollar! recently did an episode on this exact topic! I would highly recommend listening to that episode (and all of them, honestly).

  59. Thlayli*

    Never freelanced but did take a long career break when I had my kids, during which I had a small amount of income from government benefits (EU) and some part time work. My advice is:
    1 figure out how much you spend at the moment. In case you haven’t a clue how to do that: look at what was in your bank accounts / savings on 1st January 2016 and 31st December 2017 – this will tell you how much you saved (or took from savings) in those two years. Look at your final tax info for those two years – this will tell you how much total you earned in those two years. From there it’s really easy to figure out what you spent on average per month in those two years. If you bought the house or anything else big during that time, just look at a shorter period of time, or delete the unusual purchase from the total.
    2 now that you know how much you spend on average per month, work out how many months you can live on what you have right now in accessible money (ie excluding pension or long term inaccessible saving). Hopefully you have 12 months or more saved up.
    3 if you have less than 12 months saved – you have two choices. Reduce your spending or continue taking all the jobs you can get till you have 12 months worth of savings in the bank.
    4 Once you have 12 months of savings, you can stop taking on too much work. Even if you never earned another penny, you would have 12 months to find another job. That’s plenty. At that point you can afford to be choosy and live your life instead of just working to live.

    After that, it’s just a matter of keeping your accessible savings at that level and putting income over and above that into long term savings – pension or mortgage overpayment.

    You may also want to consider either setting up an additional emergency savings fund or taking out an insurance policy for things like if you become ill and have massive hospital bills.

  60. H.C.*

    As important as budgeting finances is budgeting your time & how much you want (or should) to devote to work vs non-work activities: track the time you spend on work (incl. non-paid activities such as writing a proposal or pitch for a new client, admin work for your freelance business, etc.) and then set a limit on how much time you’ll work each week/month. And stick to it as much as possible.

    To put in perspective – your money & finances may go up and down, but time only moves in one direction.

  61. ArtsNerd*

    Consider treating your whole life like your business, since you’re prone to making your business your life. What are your goals for you entire self? Why? How do you get there? Is your actual goal to hoard all the money? Probably not. What does the money let you do? You’ll want to make sure you have enough to do that.

    Set specific revenue goals for your business, and keep a reserve fund for slower periods. Then plan accordingly. Once you hit your revenue goals, be strategic. You can pick and choose how you spend your time, so look back at your entire-self goals. Do a self-performance review.

    (Similarly, you are your own boss which means you are also your employee. Don’t let your staff burn out; it helps no one — not you, not your business, not your clients, not your goals, not your reputation.)

    Keep this phrase close to your heart: “I don’t have availability right now, but my calendar should open up around [X time.]”

    I was only full-time freelance for a couple of years (still part-time freelance, part-time 2 other jobs + personal creative endeavors, whee!), but was anxious about making enough money for years and years before that (hello, creative fields).

    In order to set my revenue goals and get my “strategic goals” together, Mint is a very helpful tool for me. Not so much their budgeting feature, which was terrible at variable income and expenses when I first tried it, but in tracking my past spending. By budgeting based on what I actually spend in a year (which stays surprisingly static and includes almost all of the big one-off costs that hit, plus reasonably predictable variations on cost of living, new mortgage, business costs, etc.) I can aim for a specific income on my freelance work. It’s helped me so much.

    1. ArtsNerd*

      Re: quarterly taxes — I consider the (not terribly large) IRS penalties and interest a convenience cost for not filing quarterly. Depending on your tax obligation (how much overhead and expenses can you write off?), it may or may not make sense for you to do the same

  62. Glomarization, Esq.*

    I’ve been self-employed for about 10 years now. Many of my law firm’s clients are small businesses and self-employed professionals.

    1) Look into long-term disability insurance to supplement your health coverage, and also business interruption insurance. The second there will help cover lost income if you lose the tools of your livelihood due to a disaster or injury. They’ll give you peace of mind, too.

    2) Make sure you’re charging at least the local market rate for your services. If you haven’t done some kind of research recently, prioritize doing so. You may be surprised to learn that you’re under-charging your clients/customers.

    3) Raise your hourly rate by 5% or 10% or so every year. How about doing this on your birthday? Or the beginning of your fiscal year so you don’t add a complication to your books. This raise is in recognition that your skills and knowledge are growing every year, and your output is more valuable to your clients. Or raise it even more, especially as your health insurance costs go up every year, and the American tax code makes it more difficult to take business deductions. Your frequent-flyer clients will understand that you need to pay your bills, and your new clients will understand that they get what they pay for.

    1. Natalie*

      Re: #3, you should also be including inflation in that calculation – currently about 2%. Otherwise you’re literally making less money every year.

  63. Freelancer OP*

    There are so many kind replies here! Thank you all. I’ll go through and answer many individually, but I’ll go over a few points that have come up often.

    Saving several months at a go— I definitely do this. I get seriously uncomfortable any time the level drops beneath that six-month mark, because it’s not at all unusual for me to go three to four months with no payments. (The nature of my business is that I get paid in large lump sums, often on irregular schedules.) This was especially hard over the past year, which was a low-earning year, so of course my house suddenly needed multiple major repairs. This drives home the fact that I need to be saving even more than I already am! You’re all absolutely right about that.

    Budgeting/salary—I do pay myself a salary each month, which is helpful. I’ve tried YNAB, but there’s something key about it I’m not understanding. I’ll be visiting that thread for tips!

    Xanax—yes, that was a joke. But I do have a psychiatrist who prescribes my antidepressants and an anti-anxiety medication that is NOT Xanax. I don’t take this every day, or even every week; it’s more of an “in case of emergency, break glass” thing. It is a great help to me, since anxiety is an issue I have totally aside from work as well, and I’d encourage anyone who feels like they could use that kind of help to work with a medical professional to determine what’s right for you.

    Other part-time work — this really isn’t feasible. My freelance stuff is pretty demanding, and often involves travel. So it requires a lot of flexibility. The only other work I could pick up would basically be other types of freelancing, which doesn’t help the core issue.

    Turning down work is hard. I have done it, including actually the single most lucrative job I was ever offered. That project was very much at the far end of my skill set, and the time frame was literally 1/4 of what I would consider reasonable for that much work. So I know it was the right call, but it still haunts me a little. Honestly of all the jobs I’ve turned down, there’s only one I have no regrets about. This is something I need to work on.

    Probably in my letter to Alison, I should’ve mentioned that anxiety is an issue in my life regardless of anything. It’s especially acute regarding work because the concerns and the stakes are very real! But it’s maybe an overly sensitive point. Also, I’m the sole support of my household as my spouse’s health makes it impossible to work more than part-time, sporadically. So there’s that pressure as well. We do have non-ACA health insurance, which is a rare blessing, but while that insurance is adequate we do have out of pocket health expenses an employer plan would probably cover.

    Thanks again to everyone who has replied. I apologize for not being able to answer everyone individually, as it’s a busy few days. When I wrote Alison a couple months ago, I was in the middle of my driest dry spell in years. Since then I’ve booked two major projects. Which is great! But also proof that there’s no knowing what’s around the bend.

    1. Anon Today*

      Have you considered creating sinking funds for irregular expenses (like home repairs, car repairs, etc.)? Those things that will happen you just never know when they will pop-up?

      That way then the 6 months of expenses that are saved are for your regular expenses, but when you have an irregular expense you know that you have the money. For things like home repairs it’s recommended to save 1-3% of your home’s assessed value, and then abut $50-100 a month per car (depending on age). At least I’ve found having sinking funds of this nature to be a comfort.

      1. Jack Russell Terrier*

        Yes – Michelle Singletary has a personal finance column in The Washington Post and has two pots you should save. She calls them a ‘life happens fund’ and an ’emergency fund’. Life happens is for expenses that annoyingly crop up like repairs to the house, the car breaks down and costs $ to fix. The emergency fund is for if you lose your job/income and it’s savings for you to live off. I like her common sense advice a lot.

  64. Glomarization, Esq.*

    > Yes to Xanax.

    I’m sure this is intended as a joke, but popping anti-anxiety medication doesn’t address the underlying issues related to feeling out of control as a freelancer.

    Not a fan.

    To make this more helpful, I’ll add a (4) to my list above: LW, join a local association of professionals in your field, if you can find one. They’ll likely have social events, provide networking opportunities, offer discounts on software/insurance/services/banking/etc., and maybe even have skills seminars or workshops or something. The more people you meet, the more chances you have of getting some work referred to you during a dry spell — and vice versa, which will just increase your professional network and reputation.

      1. Glomarization, Esq.*

        Oh, you got me. I failed to Ctrl-F and search for “derail” before I commented, and in the absence of a warning at the end of Allison’s answer, I gave an opinion about what I perceived was unhelpful flippancy about using downers.

        I hope the LW and other similarly situated readers find my association suggestion helpful, in any event.

      2. caledonia*

        Perhaps it should be a standalone comment of Alison’s as many people will close threads as standard. I too, did not realise it was a joke.

  65. Nanani*

    Get a financial advisor, a reliable and trustworthy one, to help you.
    Things to address could include short term savings for your quarterly taxes, estimating how much to set aside for various other things, longer term savings like pensions, and even buying insurance.

    1. Iris Eyes*

      A tax accountant would be a great idea! Beware though of financial advisors that sell products, they aren’t necessarily bad but there is a tad bit of conflict of interest.

  66. Shay the Fae*

    This is only loosely related to the topic, but I hope I can share.
    I’m still in college and am hoping to start freelancing this summer. I’m currently putting together a website that also acts as an archive of nearly all the art work I’ve ever made. It’s… exhausting. Really mentally taxing. I’m trying to take breaks ever 15-30 minutes or so to avoid the head ache. And I have 8 years of art I want to put up and sort. I’m going to be doing this for days.
    Anyway, listening to the comments (I use text to speech) and the podcasts that have been recomended has really helped me keep my flow going.
    Thanks everyone for sharing their thoughts. I’m wishing everyone the best in their endeavors, free lance or otherwise!

    1. JJ*

      Hey just a tip, it’s great to have an archive, but it can actually work against you as a marketing piece, in the sense that (especially if you have different styles, which you probably do after 8 years) you’re asking potential employers to decide what to hire you for, and if it’s not immediately clear, many will pass because they don’t have time to figure it out. Jessica Hische talks a lot about how it’s easier to hire a specialist than a generalist for freelance work (I’d recommend a YouTube binge of her talks). It’s a little bit of a catch-22 because you want to show range, but you don’t want to make it difficult for people to figure out what you’re about.

      Consider making a second site that’s short and concise, that’s curated and organized and sends a clear message about the work you’re seeking, like “Hi I’m Shay and I specialize in llama oil portraiture and photography” and then you just show that, and you save your 2005 alpaca sculpture phase for the full archive site. I’m a designer, and the way I do it is my portfolio website is all the design stuff, and my Instagram (which is linked on the website) is all the personal artwork.

      1. Shay the Fae*

        Thanks so much for this response!
        That is kind of what I’m doing. I have a landing page that has a brief artiest statement, and then linked pages that lists “current ware”, and a separate commission explanation page for each specialty. “Commission Tea Pot Portrait” “Commission Jewelry / Jewelry repair”.
        I am now questioning why I am bothering to up load and sort the documentation of art from years gone by… Well, if nothing else my close friends and family (and maybe one day fans?) might enjoy seeing the pieces and my writings about them. They are also sorted by theme so maybe someone will find that interesting.
        Either way, it is also kind of like another back up, just in case my cloud one and external hard drive fail.

      2. Jack Russell Terrier*

        Yes – you’re probably already doing this, but organize your artwork into categories so people can go straight there. Keeping JJ’s example – you might have ‘llama illustrated boxes’ and ‘llama watercolor sketches’ and ‘llama shadow boxes’.

        1. JJ*

          A lot of people are completists and like to have a full archive, sorry if I made you doubt your plan! It’s fun to look back on all that stuff, for you and for people who are interested in your work, and see how you’ve progressed. I had a large art archive for a while that definitely helped bring in some work on its own, particularly art/design hybrid stuff like gig posters, which are great things to do as a young artist, I still have mine in my portfolio and people still comment on them. (I’ve been out of school for nearly 15 years.)

          As you begin to work on more professional stuff you can decide how much value it’s bringing you vs. showing the things you’re focusing on for your career, since I work as a designer and not an artist, I moved them off my site totally to minimize confusion. Definitely keep things organized/easy to browse as per Jack’s suggestion, especially if you’re not sure what you want to focus on in terms of seeking work yet.

  67. Iris Eyes*

    Especially when dealing with variable income it is ESSENTIAL to have a financial buffer. You should embrace the idea that you determine you expenses based on your needs, that isn’t determined by how much money you have in income. Aggressively build a cushion that will cover your expenses for twice as long as your longest dry spell. It is amazing how much anxiety is alleviated by knowing that you have enough money in the bank to cover 6 months or whatever.

    Focus on what you can control to the degree you can control it.

    1. Iris Eyes*

      Oh yeah one other thing keep your credit usage low (pay off debt and be selective about new) that way you have that buffer to draw on as well. So say you have 1 month of expenses you could float on a credit card, 5 months cash in savings, if you are a home owner you might have access to a HELOC for another couple months worth.

      When you are anxious and can’t think about other things start planning. Come up with a game plan for each month then break down to each week what you plan to do to 1. increase income and 2. decrease or stretch expenses (i.e. at what point do I stop any eating out, at what point do I stop paying on debt, at what point do I cut the internet and cable.) If you know you have say 6 months of buffer then maybe you have on your list to look for part time temp work in month 3 and then in 4 start job searching as well. You can always abort the process if things get better but at least you will have a plan and know that you can probably keep a roof over your head and food on your table (and any other obligations met). Once you have your plan then you can soothe yourself with rehearsing it when anxiety strikes.

    2. Iris Eyes*

      Oops got ahead of reading the comments. I see that you are already doing much of this.

  68. HR Evil Uncle*

    Man, I read the heading and was excited to read up, popcorn ready.
    I was expecting some action packed intrigue ala Jason Bourne.

  69. Sally*

    I’ve just got a perm job from being a freelancer and the lack of flexibility is such a shock- I can’t look at the news for half an hour without getting side eye, can’t go home early because there’s nothing to do.. and I hate being in an office! I want my old life back of getting up at 11, working in a cafe, rushing from job to job all over town, finishing at 10pm :)

  70. JKP*

    Self employed most of my life. I set aside 1 day a week to market / bring in new business. Otherwise when I was super busy, I would spend all my time working then fall off a cliff when I finished and had no new work. So spending regular time bringing in new work kept the business flowing steady.

    Everytime the rest of my work time filled up, I raised my rates. Usually the more difficult and time consuming clients would drop off as I charged more. Then, if I had a lull, I would have a sale and contact people who couldn’t pay the higher rate before.

  71. Glenn*

    This is a minor technical point, and does not go to the main thrust of the question, but could still be a HUGE help for OP if they’re not familiar with it:

    OP, do you file your estimated US income taxes using the annualized income installment method?

    This is a slightly obscure point of the tax code that _completely_ takes the guesswork out of estimated taxes for people with uneven and unpredictable income, by allowing you to pay your estimates based on _that quarter_’s income, instead of your guess for the year’s income, with no penalty.

    You should really really look into it if you haven’t already.

  72. JJ*

    Ha, I’m a mid-five-figures freelancer and I laughed at loud at the idea that someone who occasionally makes “mid six figures” ($500,000??) a year could have money anxiety. Just adjust your lifestyle to be a little smaller! Like, buy a Civic instead of a Lexus. People tend to scale their spending to match their earning…a good tip is to put the excess good-year cash into a separate bank account in a different bank that you 1. rarely look at and 2. is inconvenient to access (so you’ll leave it alone unless you actually need it). If I had one mid-six-figure year I’d quit working and live off of that for like 5 years.

    1. Natalie*

      Well, anxiety isn’t always rational. Usually people struggle precisely when it isn’t, in fact, because they can intellectually recognize that things are fine, but the feeling of anxiety isn’t going away. If you’re really accustomed to taking that feeling as a warning sign, then it’s easy to latch onto something as a repository for the anxious feelings. (Plus figures are relative; it’s hard to know what someone could live on without knowing details about where they live and who they support.)

    2. Tea Fish*

      While on one hand, I get it– if I made a six figure number in a year, ever, I would also be set for the next five years, this isn’t really helpful to the OP, whose personal circumstances you don’t know. I know folks who make MAGNITUDES of money more than I do and who still end up with less in the bank every month. Sometimes it’s because of Vegas trips and Audis and a need to upgrade to the newest and shiniest iDevice every two months. Sometimes it’s 200k in student loans and four kids in private schools. Sometimes it’s both parents in 10k-a-month skilled nursing and an ailing spouse and personal health issues that rack up huge medical expenses. Life can be terrifyingly, painfully expensive in ways that people can’t always control, and you can’t judge the OP’s ability or inability to save without knowing their personal circumstances.

      1. Freelancer OP*

        Also thanks. I nearly didn’t write bc I knew some people would assume that because I’ve had a few outstanding years, I have no financial worries worth considering, and never ask about a disabled spouse, or old debt, or other very real factors. I’m grateful I only drew one comment so insensitive, and more grateful that you raised this point. Thank you again.

  73. The Other Katie*

    I recently enacted a rule that I Have Weekends Off, after a decade of the freelance life. It feels sooo good to finally feel secure enough in my income flow to think I can take a few days off. It really does help to remember that just because I set my own hours, not all hours have to be working hours. Having some savings built up has definitely helped with that.

  74. Family Medicine Physician*

    Hey – this is directly for Alison, not sure if she’ll see it, and I’m going to place this comment in a few places if I can (apologies ahead of time for the unintentional spamming).

    As a family physician, I ask that you do not promote benzodiazepines. I recognize that it was intended as a joke, but it really doesn’t come across that way (as a few commentors have already mentioned). As noted, benzodiazepines are well-known to be addictive, tolerant, dependency-forming, with possible other side effects of long-term dementia and death from withdrawal. There is a reason it’s a controlled substance and it’s not to be messed with.

    I see patients multiple times per month who have been on it for years and have a difficult time coming off. They have used it as monotherapy for their anxiety and (not surprisingly) their anxiety has continued to be a concern for them. One of my patients is going through severe withdrawal after having taken this medication for 25 years and we’ll likely have to carefully taper her off over several months to hopefully avoid any hospitalizations. Although benzodiazepines do have their place, freely saying “oh yes, take this habit-forming addictive medicine that can potentially cause death for your anxiety!” is inappropriate, especially as your site is used as an advice blog.

    I recognize that you are not in the medical field, so I certainly wouldn’t expect you to necessarily know this information. But there have been multiple comments noting the seriousness of benzodiazepines – largely with correct information – and you have declined to edit this post to note that. I’m not sure why, but it’s disappointing – this is an advice blog and this is a poor piece of advice you are choosing to not fix. I’m hoping that this information from a physician helps influence that. (If you would like further information, there are many sites out there with lots of medical information that will confirm my notes above.)

    1. Ask a Manager* Post author

      I don’t believe people are seriously reading that as me encouraging them to take Xanax regularly as a strategy for dealing with the stress of freelancing, or that they would decide to do that without consulting with the doctor who they’d need to prescribe it. I strongly believe my readers here are adults who can handle an occasional joke, even about drugs, and that they don’t need me to include a “that was a joke” disclaimer. It’s okay if not everyone agrees with me, but that’s my take and why I haven’t edited the post.

      1. Hiring Mgr*

        I knew it was a joke and don’t know anything one way or another about xanax anyway, but you can see now that no matter how certain you are it’s obvious what you’re writing is a joke, people will think you’re being serious.

        1. Agent Veronica*

          It looks more like everyone knows it’s a joke but assumes other, less sharp readers will get it wrong and this run out to pop pills immediately. This is basically concern trolling.

      2. Courageous cat*

        Agreed. People should be able to use a little nuance here when reading responses.

  75. fieldpoppy*

    I’ve been an independent consultant since 1995, and the only income in my household for the past 13 years, and my advice is that you have to look big picture — as Alison says — which is looking for the throughline of your average income over, say, 5 years. What I try to do is pay myself a “salary” (now it’s officially a salary since I finally incorporated, but for 20+ years it was a nominal salary” which was considerably less than I made most years, and use anything over and above for retirement savings, paying down my mortgage and emergency cash. Even after nearly 25 years of working this way, I still wake up some nights when the furnace kicks on and have this momentary panic of “OH MY GOD HOW AM I TOTALLY ACCOUNTABLE FOR PAYING FOR ALL OF THIS.”

    Then I remind myself it’s worked out okay for the past 20+ years and that I assume it will continue, even though we’ve just elected a provincial government that banned any spending on consultants, and most of my work for the past decade has been in the public sector. The work evolves and I do better coming from a perspective of abundance (“it will work out”) then scarcity (“eeeeek”).

    Good luck!

    1. fieldpoppy*

      Also when I get really torqued out I make an extra transfer onto my mortgage or into my savings. It makes me feel better.

  76. Little Miss Cranky Pants*

    Freelancer here for 15+years. For me, the low-grade anxiety *never* goes away. But, I know that I can have a “sale”, contact previous clients, remind them I’m here, ask them for referrals, and go out to semi-local networking events and touch base with people that way. I did a meeting like that last month, and sure enough, one of the folks there sent me a new client. I just finished sending him a contract, and he’ll be sending me a deposit in return!:0 And if I get the willies-jillies and wake up at three in the morning, then I can just get up and Do Something Productive.

    I can also highly recommend The Money Book for Freelancers, Part-Timers, and the Self-Employed. Their posit has the same basic concept: of course, you have to spend LESS than you earn, and you have to save for various reasons–taxes, insurance, biz expenses, your own retirement, etc. Their overall tone is colored by their coupledom so if you find the use of “we” grating, then you’ll just have to deal, but their advice is sound.

  77. ZucchiniBikini*

    This letter resonates with me like WHOA. I have been freelancing for the past three years and I love almost everything about it, except the uncertainty and the anxiety about future work. I agree with Have a Plan as a key tool, and I also use a Squirrelling for Winter technique, where I make overpayments on the mortgage as often as I can (which in good times is almost every month) because I have a mortgage with a fully flexible redraw, so if work gets scarcer I can draw back on that extra money (and if I don’t need to, great – I’ve just got further ahead on the mortgage!)

  78. BePositive*

    You say you in a creative field. I’m guessing and its something to do with graphic design or consulting etc? Below is based on that guess. Sorry if I’m super wrong.

    I vote taking a part time job but I know other creatives that it’s not for them. If that is not for you, a suggestion is to sell your services online like Etsy. A know some creatives supplement by selling downloads like mock ups, photographs and graphics. The income is passive (I sell in Etsy my graphic designs) and wont matter if you are busy or not. In the slow spells, offer small services like logo design

  79. JessicaTate*

    I’m late to this party, but I have been an independent consultant as my full-time job for over 2 years. I am one of those strange people who likes both the creative side of my work AND the business management side. Which means I’m always thinking about this stuff, and see it as a positive challenge. I do stress about it, but less and less over time. My main tips:

    1. Having a separate business bank account, out of which I write myself a monthly “paycheck” that is essentially the amount I would expect in a salary + drawing out money for taxes/retirement/savings, as necessary. When I had a good year, the excess stayed with the business. Seeing that balance reminds me that I have a cushion even when I hit a low month.

    2. I realize that a source of calm for me is that I’ve never (even when employed) let my lifestyle expand to fit my income. (You could say I’m comfortable, but frugal.) As an independent, keeping my “salary” modest aligns with existing habits of not indulging financially just because I can. I’m not sure how easily that translates for everyone.

    3. Quarterly Taxes: At the start of the year I sit down and go through all of the stupid IRS forms to calculate a likely total due for the year, based on the alchemy of work under contract, the total amount I’d need to develop to maintain my “salary”, and how last year went (because that factors into penalty calculations). At the end of June, I revise my business budget based on actual income and expenses and new contracts; then I reassess whether I need to adjust estimated payments and/or how to time end-of-year business expenses. I like this stuff, so I still DIY my taxes; but if you hate it, I suspect a good accountant would be very worth the (deductible) expense.

    4. A Fee-only Financial Planner: She has been a calming force. While my main impetus was to have someone to figure out self-employed retirement savings, she keeps an eye on my overall personal financial picture and advises on where and how to save most effectively, considering my work volatility, budget, sudden big expenses (we need a new roof!), etc. She gives me confidence that the money I do have is working for me, that I have a cushion if times get tough, that I will be able to retire one day, and that I actually do have my eye on the ball.

    5. When it gets really frustrating (and I have to write that stupid check to the IRS), I just remember that this is the cost of no longer having a crazy, toxic boss. And that is worth every penny.

    Good luck to you!!

  80. Indyjones*

    This has been a great thread! Very helpful. I’m currently mulling over whether to go freelance for a guaranteed year long contract on the hope/bet that additional work will follow or to stay in my Corp position. I have a kid starting college and the free lance work offers higher return and better odds for paying tuition. But if it all falls apart after that one year… I am so torn over what to do! Luckily I have several months before I need to decide. All these comments have been greatly illuminating.

  81. missc*

    I don’t really have any good advice beyond what everyone else has already said, but I wanted to add my voice to the ‘I know how you feel!’ freelancer solidarity movement.

    I’m currently getting used to being back in full-time employment after four years of freelancing – I’ve just started a one-year maternity cover contract. Could have applied for a permanent position but wimped out – my reasoning was that if I totally hated it, at least this way it’d only be for a year! Of course now I love the job. Anyway. I completely understand how you feel about the freelancer terror – I think most people find it’s feast or famine most of the time, and that can be really hard to plan for. I made things easier for myself by setting up a regular monthly payment into a savings account, which I then used to help pay my tax bill every year, and I tried to save a bit more whenever I had a busy few months. Ultimately, I was prepared to live with the uncertainty because of all the benefits freelancing brought me – freedom, setting my own schedules, working from home, choosing the work I wanted to do, etc – but I have to say that now I have a regular salary every month, there’s a lot to be said for that too!

  82. Gary*

    If you’re nearly 50, you should have a pile of what I call “sleep-well-at-night money” somewhere. My wife once asked me why it was necessary to have 40 grand in the checking account and another 50 in money market mutual funds. I told her it was because “it helps me sleep well at night”, which in turns keeps me healthy and calm.

    Find out how much sleep-well-at-night money will make lower your stress level. Then make it happen.

  83. Cristina*

    Here are a few things I’ve done with my consulting business that might be helpful. First I ran numbers for a bunch of different scenarios and pay rates with the goal of being able to live in a way that’s comfortable at 20 hours per week. That way my work baseline and financial planning is all around 20 hours and I can decide on the tradeoffs if I have enough work to get me up to 40 hours.
    Regarding pay rate, in my particular area of services it is so situationally based that there’s really no standard. So I decided on my floor rate (what I could scrape by on at 20 hours per week) and generally quote a decent amount higher to start. This eliminates many potential clients but certainly not all of them.
    And finally, I keep good track of other freelancers with different (and similar) skills from mine. This way I can outsource pieces of work when it makes sense. So if my workload got way too high, I would call in a few fellow freelancers and either introduce them to the company for certain aspects of the work, or just pay them myself. Depending on what you do, this might not make any sense. But it is how I keep myself sane thinking of higher workloads.

  84. DJB*

    I have lots of Xanax. First off, I’d recommend being a realist and practical more than anything else, and make sure you have a therapist so you can get that Xanax. This is not a job for someone who just wants to make some money on the side. It’s the hardest job I’ve ever had, and I’ve been working in my particular field for more than 30 years now. A lot of you have spouses and part time jobs. I was forced into freelancing when I was laid off from work nine years ago. If you have a spouse or another person in your life, and can definitely rely on that income, I’d say go for it. However, if you’re a single, older person with no family, I’d suggest that you think about it hard–very, very hard–and then if you can, find another job. I’m currently working full-time as freelancer, and have been for last eight years. After a few years of trying, I gave up looking for a regular job because of flagrant ageism in the workplace. I live in NYC, and I’m definitely not making enough to live on here. Saving anything is impossible. Every couple of months, my anxiety jumps to new heights because a client hasn’t paid me in weeks, and I don’t even have enough money to buy food. Recently, some of the journals I’ve been editing for years were turned over to a packager. They wanted me to stay on, but at a significantly reduced rate. How reduced? I would have been making less than minimum wage. Of course, I’ve turned them down, but I haven’t been able to fill up the empty space for months now. Everyone tells me marketing, marketing, marketing, but I’m not a marketer. I’ve never learned how to sell myself, and based on what you’ve read here, you can probably tell I’d probably wouldn’t be that good at it. I’ll be the first to admit it. People want to help, but all they really want to do is sell me books on marketing, which I can’t afford to buy. I have emailed several contacts about possible extra hours and extra work, but so far, I haven’t been lucky. So plan? I’m planning on leaving the city I love because I can’t afford to live here anymore. I keep reading blogs like this about how some freelancers make much bigger incomes, but I’m wondering what field they’re freelancing for. It certainly doesn’t sound like copy editing or publishing.

  85. Long-time freelance*

    I could have written that letter. Having freelanced for 16 years, I know that anxiety all too well. I have no words of wisdom; anxiety is the nature of the beast. No one could say that I have not been successful: I raised a child alone and supported a mortgage on a lovely home from my earnings for well over the first decade of my freelance career. But, changes in my industry have halved my earnings, and the day when work used to just fall into my lap like manna from heaven are over. To save my sanity, I sold my home, banked the profit (5 years worth of expenses, if I don’t get a serious illness, of course), and now rent. I have been trying to “break into” other industries through intensive networking. I have been minimally successful with this. So, I started applying for in-house jobs. Employers are THRILLED with my experience. Typically, I get to a second interview, only to be told some version of ‘we don’t think someone who freelanced so long can make a successful transition to in-house work’. No amount of examples of how I work on teams as a freelance and how I manage to successfully juggle 5 projects simultaneously with 5 different companies move these employers. I can provide excellent work examples and excellent professional references. This does not move them either. So, I muddle along, continually trying to reinvent my freelance practice and living in fear, despite my huge savings account.

    1. ArtsNerd*

      It surprises me that employers see your freelancing as a barrier to in-house work.

      If you haven’t already, I’d really stress that you’re looking forward to the benefits of being in house aside from the predictable pay: developing projects over time and a more in-depth way, closer working relationships, a better division between your workspace and life space (if you WFH as a freelancer, and won’t in-house), being able to focus on the content of the project and not the admin involved in business development and invoicing, etc.

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