Cash in now or hold over?
Freelance writers have the ability to control their own income in more ways than one. First off, the time that you put in will be directly related to how much money you earn. I have found this out time and time again. In addition to the actual money you make, you may also have the ability to control when you receive it from clients. The question is: should you cash in now or hold off until the new month begins?
There are two ways of looking at this scenario. There is a side of me that likes to hold money over from one month to the next so that I can get off to a “good start.†For example, I have three invoices from the month of September that total more than $1,500. Even though I am confident that I could send them and get the money within a day or so, I have decided to hold off until after the first of the month. This way I can add the money to my October total, which will make things much less stressful during the early days of the month.
The downside of holding off on sending invoices is that clients can and will disappear. One situation in particular stands out in my mind. I was working with a client who I thought I could trust. For this reason, I decided to push their $750 invoice from one month to the next. The result was the client disappearing for weeks, and upon coming back into the picture, paying me in small chunks of the entire voice. Of course, this still may have happened if I would have sent the invoice right away, but something is telling me that as I was waiting they spent my money on other things.
The only time I will hold money over is when I know the client is good for it. In other words, never wait if you are working with a client for the first time. You might as well invoice them right away in order to give yourself the best chance for payment. Not to mention the fact that they will probably appreciate this as well.
What income level do I have to reach in order to start thinking about holding money over? For me, this usually comes around the $4,500 to $5,000 mark. With my current workload this is the minimum amount of money that I want to earn each month. So if I hit this mark and there are only a few days left in the month, I will usually wait until the next month to send invoices. But if I reach this income plateau earlier, say the middle of the month, I obviously push on.
This is one aspect of a freelance writing business that has nothing to do with producing content. But as you can imagine, it is very important. After all, you are working to collect money!
