Nine-to-Five jobs with desks and paid vacation and retirement benefits are not going away, contrary to what you read. However, more and more people are choosing to freelance or work several jobs instead of a more traditional career path. If this describes you, read on for two tips on securing your finances in the gig economy.
Save 40% of what you make.
That sounds awful, but you have a future retirement to fund and taxes to pay now. The only way to fund those buckets is to save now, even if you are just saving from a $10 day. You will owe 15% in self-employment taxes, income taxes on top of that, and you should be buying medical insurance. Plus, you need to be saving 10% of your income each year for retirement.
Invest in a CPA.
The H&R Block temp employee will not advise you on ways to reduce your income taxes by smart (and legal!) write-offs and saving money pre-tax in a retirement account. A real CPA will likely pay for him/herself by lowering your tax bill.
Looking for more insight on how to plan? CLICK HERE for my FREE class on Finances and the Gig Economy!