Financial Management for Freelancers

I remember a few years back around Christmas I met a friend (an erstwhile freelance photographer) over drinks at this nice place in Mumbai. While we were placing the order he said something funny that still rings a bell,

Let’s order Hoegaarden, come June, I won’t be able to afford anything but Kingfisher

We laughed our hearts out and although it was a funny and harmless comment, it had an underlying shadow of the obvious monetary uncertainty looming over freelancers. If you are anything like my friend, it’s time to review your financial position and start managing your finances more wisely.

You don’t have to be a CA or MBA to understand and implement these 10 basic guidelines to get better at managing your finances and even afford a Hoegaarden (if you like it) all year round. 

  1. Open a separate bank account. 

Know that your professional income isn’t your personal income. Out of your professional income, pay yourself a salary that you can spend on yourself. The balance money is to support your business/ professional expenses, investments, and any growth/expansion plans. 

Go to a bank and open a separate bank account for keeping track of all your professional transactions. Also, debit your salary to your personal bank account. This will give you a better idea about how much money you are making (your revenue) at the end of the year. 

  1. Account your income.

While you might love photography, cinematography or editing, it is not enough to just keep doing that, have the money flow in your bank account and forget about the rest of it. You need to know how much money you are making in a particular year and how many man-hours you have invested in that year to make that much money. In short, you must know how much your time is worth. 

Only when you track your income in comparison with the time spent, you will know the real worth of your work. This way you can formulate financial goals and assess how to maximize your efforts to attain more income opportunities.

  1. Account your expenses.

Accounting your expenses will tell you about how much and where do you spend. 

Let’s take an example. Yash is a freelance photographer and his annual total income comes to INR 4,50,000 per year. Is INR4.5 lakhs his profit or his income? What about the money he pays to his assistant? The petrol cost for his bike which he uses to travel locally to venues? Camera servicing fees? Equipment rental charges? Software subscriptions? Internet expenses?

Keeping track of expenses like these help you know your spending pattern. It also tells you about the unwanted expenses you can cut down and the areas where you need to spend more (e.g., Advertisement). Only when income and expenses are tracked properly, will you know the real profit numbers. Lastly, tracking expenses is also extremely essential for taxation purpose (more on this later). 

  1. Account for deprecation. 

Let’s learn depreciation in a simple way. If you buy a camera for INR1,50,000 and you predict its life to be 3 years, you are losing a value of INR50,000 on it each year. That is the depreciable amount of your camera each year. 

When you record depreciation and put aside INR50,000 or more (as an expense or investment) every year, at the end of 3 years you will already have INR1,50,000 or more to buy new equipment. Just close your eyes now and feel the comfort of that money. 

Now imagine what would happen if you do not put this money aside annually. After the 3rd year, you will have an outdated camera that’s worn out with no specific savings to buy another one. 

  1. Save before spending.

I am not asking you to save before paying your bills/ recurring business expenses. Paying for mandatory expenses like electricity bills, mobile & internet bills, equipment repair, fuel bills etc, is essential for the smooth functioning of business operations. 

The gist is to save before you spend on yourself. Save before you splurge and invest the money that you save so that your money earns more money. You can invest in banking products, mutual funds, equity markets, real estate etc. The investments will help you secure your future and bring you a steady flow of side income. 

  1. Don’t put all your eggs in one basket.

It is very important to diversify. Don’t depend on just one income stream. That does not mean you do not need to master that one super skill in your chosen field. You do. But in today’s competitive world, you need to have varied skills and know-how of similar fields. Do not be just a wedding photographer; explore additional genres like editorial, fashion as well. 

  1. Plan for income fluctuations.

As a freelancer, the income flow may not be steady or consistent especially if you are in the wedding industry as it is a seasonal industry. 

To compensate for a low-income period use this trick. Start with dividing your last year’s total income by 12. Remember this amount. You cannot spend more than this amount per month including any work-related expenses or personal ones. Period. 

By doing this you will be left with a chunk of surplus to take care of your expenses during the offseason. If done wisely, this can be your security blanket during uncertain times such as this pandemic which nobody predicted.

  1. File your Income-tax returns. 

Filing tax returns is not the same as paying taxes. Regularly filing income tax returns is necessary, even if your tax liability is nil to get that housing loan for your dream home or a business loan that you may need. You also need tax returns for visa applications for some countries which will matter for your personal/ work-related travels. 

  1. Invest in Yourself! 

Profoto invests at least 10% of their profits in R&D every year and so does Apple. If you look it up, so do most successful tech companies. 

Now answer this. What was your last year’s annual income? Calculate 10% of that. Do you invest that much money in learning new things or developing your skills every year? If not, please start right away. Only investing in new gear is not enough, up skilling yourself is equally, maybe more important. 

Another important thing – please invest in your health. Late-night shoots many times combined with early morning schedules, limited breaks, erratic travel schedules, unhealthy food, odd eating hours, no workouts (lifting cameras does not count!) make us live an unhealthy lifestyle. It is important to take care of your health. Invest in medical insurance for you and your family.

  1. Make a 5-year plan.

All the glory that this profession offers eventually fades. The fancy Instagram stories at airports, photos from a plane window saying “somewhere on earth”, slow-mo videos of you dragging your fancy camera bag at some beautiful location will give you lots of hits on your Instagram but that’s all it will do.

Have you thought about where you want to be in the next 5 years? Would this field make any financial sense after 5-10 years? These are tough questions but please ask yourself these tough questions. Get your answers and then go for it. Think, plan and then achieve. Review your past annually to see if you are on track to achieve your goals.

The last word 

I hope this list made sense to you and at least a few of the points you can implement to manage your finances better. Here’s a bonus tip for you to bid farewell. 

11. Use your credit card wisely.

A credit card can be a useful tool in financial planning if used wisely. Use the card for planning your expenses but remember that you can only spend as much as you have. The moment you start overspending and start paying late fees and interest on your cards, you have planned your doom with a debt burden at a super high rate of interest. Use the rewards system and offers available on the cards to save money and earn freebies. 

Punit Desai
Founder of Dreamcatchers Photography


  • Abhishek Kanani
    May 31, 2021 at 6:06 pm

    This blog is really helpful. Thanks Punit!🙌🏻

  • Shashank Ghare
    June 21, 2021 at 5:33 pm

    Great blog.Thank you 🙂

  • Chauhan Naresh Kumar Virendra singh
    June 23, 2021 at 12:48 pm

    I agree ur all this point

  • Nagesh Hingewar
    June 23, 2021 at 12:54 pm

    Really helpful thanks❤️

  • Viral shah
    June 23, 2021 at 2:02 pm

    Perfectly explained about finances.. Facing by photographers.. Thanks for sharing your knowledge..

  • parthkankotiya
    June 23, 2021 at 4:33 pm

    saach baat boli bhai aap ne

  • vicky3dvideo
    June 23, 2021 at 5:00 pm

    very Helpful Thanks for sharing your knowledge sir

  • Ashish Deshpande
    June 23, 2021 at 5:08 pm

    This blog is really helpful. Thanks

  • Nirmal Chaudhari
    June 23, 2021 at 5:40 pm

    Very helpful 👍🏻☺️

  • Sam Dawjee
    June 23, 2021 at 11:23 pm

    I wish someone would have told me abt these things few years back when I started my career..So Damm Useful❤

  • mousumde1298
    November 4, 2022 at 12:52 am

    Amazing blog post. learned and understood lots of things

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