The success and growth rates you experience directly correlate with what you invest in your business. It is uncommon for a freelancer to have unlimited resources for their business, which makes it crucial for them to keep track of their expenses along the way. As a freelancer, don’t neglect to track equipment investments, client communication costs, and health insurance.
Equipment Investments
Equipment is a necessary part of running any business. Even the simplest attributes like having a facility with running water play a role in your production process. Working from an extra bedroom in your home still qualifies as a use of equipment. Computers, cell phones, machinery, office supplies, etc. also contribute to your equipment costs. These costs can be tax-deductible expenses for freelancers. Rather than calculating just how much it takes to produce your product, be sure to include all associated costs for a better investment estimate.
Client Communication Costs
Communication is vital to the success of a business and cannot be done well without the proper resources. There are costs associated with the communication you have with your clientele. These would include postal services, phone plans, internet availability, and so forth. Fortunately, there are various package options that let you bundle your expenses and reduce costs. There are also several emerging technologies that make it possible to network and communicate better with your customers. Search for the latest strategies and technologies to help you run client communication more efficiently.
Health Insurance
Health insurance including medical, dental, or long-term care is incredibly valuable. You never know when something could happen to you or your loved ones that prevent you from being able to earn an income or cover the cost of the bills. Investing in health insurance is investing in the safety of you and your business for years to come. If you are self-employed, there is a major tax deduction you can take from providing your own medical insurance premiums. This is only available if you have a net profit from self-employment. To claim this deduction, you’ll find it on Line 1 of Schedule A form 1040.
As a freelancer, responsibility for everything is all on you. This can be stressful, especially for those starting out. The key to success is to focus on the basics and doing them well. Three basic expenses to keep in mind: equipment, communication, insurance.
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