Welcome to the Freelance Era.

Managing myself

Don’t go chasing waterfalls

So you’re set up and ready to go, but what’s the first step? 

Maybe it’s not the most exciting thing, but putting a few simple processes in place to manage your projects and yourself will mean less headaches in the future. And as freelancers rely on reputation to get new work, something as seemingly simple as delivering on time and within budget can really set you apart from others. 

Though traditional project management techniques, such as waterfall aren’t great for solopreneurs (here’s looking at you, subheadline), agile project management can work well because of its flexible structure.

Be your own CEO

Being in charge comes with ups and downs. Finding ways to manage yourself can help to keep you on track in the first few months. Using tools such as monday.com, Trello, or Asana can easily make sure you understand your priorities, and successfully meet project deadlines. Plus, they’re easy to use and mobile-friendly. 

Having a tool that manages your workflow, securely stores your client’s information, and quickly creates invoices can also make life a lot easier. Lano does all of this and more — it even allows you to create timesheets and invoices from those timesheets in one click (I personally loved this time-saving perk after trying it).

Cash flow is king

This is especially true in uncertain times. One way to master your cash flow is through a simple monthly or quarterly cash flow forecast and budget. 

If clients are late when paying invoices or you have a large amount of seasonality in your business, using tactics such as invoice factoring, where a third party fronts the cash for the invoice and takes a percentage of the end amount, can ensure cash flow even during income-dry months.

Taxes, taxes, taxes

A part of everyday life, for almost everyone. Setting reminders in your calendar for tax deadlines and prepayment dates means they’ll be front of mind when they need to be. Putting a fixed amount into a separate account each month can help make sure that the tax money is always there when you need it. 

Prospecting

Bringing on new clients is something that has to be done regularly. It’s one of those things that’s easy to maintain, but as soon as it’s not, you’ll feel the burn. Hubspot has created a comprehensive guide on prospecting with a number of actionable items. They advocate for the inbound sales approach and outline a number of suggestions for successful prospecting, from research, to lead scoring, to which channels work best at which point in the funnel. 

Business expenses

Keep your business receipts. Better yet, use an online platform to manage and store them — luckily most invoicing tools have this built in already. 

In Germany, be sure to keep the receipts for up to 10 years, as you may be audited at any point in that time. When going to restaurants or bars, ask for the Bewirtungsbeleg (sometimes known as “the long receipt” if your German isn’t there yet). You’ll need to fill it in, writing down who you met, why, and sign the receipt.

Business travel in general

Sometimes business travel is a needed expense. Luckily, as with most other expenses, it can reduce your taxable income. That doesn’t necessarily mean it’s a good idea to splurge on five-star hotels and first-class travel for every trip, but if cash isn’t tight and it’s a 13-hour international flight, your future-self might thank you for a better night’s sleep en-route. 

What’s worked for us is keeping up to date records for all expenses, ideally putting them into an online expense tracking tool — a number of invoicing tools already have this built in.

Business travel in Germany

As a freelancer in Germany, there are set claim rates for business travel both within and outside of Germany. As a freelancer, you can take advantage of these, and a tax accountant can help you with it. 

There are daily flat rates for expenses and travel outside of Germany, making it easy to deduct these expenses from your taxable income. We’ve added the 2019 table, and the 2020 table for international expenses as footnotes.

Takeaways

  • Be your own project manager, but use technology for the heavy lifting
  • Keep an eye on your cash flow
  • Save early for taxes
  • Prospect even on the days you don’t feel like doing it