Life is tricky out there for the self-employed. What you gain in independence (contract work does allow you to be more flexible and free than full-time employment) you lose in financial stability, as, oftentimes, you are required to bank away a portion of your earnings to cover the time you are not at work.

In other words, contract workers – or freelancers, self-employed workers, whatever you call it – have to pay closer attention to their finances. They have to save wisely and spend wisely. Of course, they have the same everyday expenses as salaried employees, like transportation, clothing, housing, etc., but that they have to be more creative and imaginative when approaching those expenses, in order to save money.

In this article, let’s bring a few of those outside the box, money-saving tips to you. Here are four ways you can save as much as possible for a rainy day.

Keep a Detailed Folder for Business Expenses


The term “business expense” encompasses a wider range of things than you might assume. Everything from transportation to work-related meals, drinks, office supplies, childcare costs, etc.can be deducted from your taxes as business expenses, saving you a lot of money come tax season. If you work from home, you can deduct a portion of your rent correspondent with the amount of space you use for work; for instance, if your home office occupies 30% of your living space, you deduct 30% of your rent.

Don’t Buy a Car… Subscribe to It

Often, contract workers need a car to commute to work. The only problem is, once the contract is over, they are stuck with a car they don’t really need. Why continue to pay a monthly payment toward a car – whether lease payments or traditional financing – that isn’t serving a purpose? Isn’t there a way to access a car without buying or leasing it? That’s a question savvy auto dealers asked themselves, and the solution they came up with was the “car subscription service”, a month-to-month subscription that allows users to drive the car they want on a monthly plan, with the ability to either swap cars or opt-out at any time. For a more in-depth take on car subscriptions, check out AutoOne for information.

Shop for Affordable Work Clothing & Hold Onto the Receipts

Buy your clothes specifically for work, and when you do, hold onto the receipts. This way, you get to deduct the clothing as a business expense. You can still wear the clothing away from work, or after your contract has ended, but it will have been deducted as an expense. So, rather than going on a random shopping spree this weekend, wait until work necessitates a change in wardrobe – this will end up saving you lots of money!

Start an Emergency Fund


Finally, a tip pertinent to all contract workers, whether you work from home, in a co-working space or in an office, whether you make 20k or 120k per year: start an emergency fund. You never know when something will come up. You never know what medical emergency or unforeseen job drought might be lying around the corner, so it’s best to shore up defenses now by squirreling away a portion of your earnings (totaling around 3 months of living expenses).

Life as a contract worker might be unpredictable, but that doesn’t mean your finances should be as well.