Over the last couple of years many people have quit their regular jobs – either out of necessity or the realization that working from home was going to be more beneficial. This has meant that many people are now self-employed and less reliant on central employment. While great for freedom, being self-employed can place a slight stress on household income and make your financial future a little unstable. On that note, the following are our top money saving tips when working for yourself.
Most money advisors will suggest that you should pretty much steer clear of credit cards when you are working for yourself. This is because a guaranteed monthly income is not always a viable option, meaning that you can put yourself into a position that means you can’t repay the minimum payments if you have a particularly slow month. Whilst this is true in some cases, not all businesses have irregular client work. If you have an ensured, regular income, reviewing a guide on taking out a home equity loan that pays out a lump sum amount so that you can make some renovations or go on a family vacation isn’t that big of a deal. It’s all about assessing your options for getting credit and making smart decisions.
Most taxation systems around the globe allow you to claim certain expenses when you are working for yourself. This means, for example, if you are working as a writer in any capacity, you can claim expenses for your laptop, any printing needed, a portion of your internet package, any software costs associated, and even the membership that allows you to maintain clients. If you are working from a country and you’re not sure of the taxation system, you will need to make sure you are aware of the expense claim situation at the same time.
If you are an American citizen living in Nepal, for example, because you are working from that country you will be expected to comply with their tax laws – this is standard and something to consider if you are considering having your startup stick to remote work post-pandemic. What you may not realize, however, is that you would also be expected to take advantage of their expense claim system. Do your research, keep abreast of the claim system, and make sure you are aware of the filing dates. If you don’t want to go to the hassle of researching everything yourself, there’s always the option to hire a professional accountant to help you out.
Personal Savings Allowance
Another piece of legislative knowhow is with regards to legalized personal savings allowances. Like the point we raised earlier, it is important that you know the difference for this for where you live as opposed to where you grew up. Ireland, for example, has wildly different taxation laws than Northern Ireland, which is part of the UK, despite the proximity. Equally, in places like the USA where different legislative branches operate differently according to state or federal jurisdiction, you need to be aware of how moving can affect your income. There are reasons you should consider moving your business, but also consider the costs. Equally – personal savings allowances are included in this.