How to Save Money as a Freelance Writer: November Income Report from Nicole Dieker

How to Save Money as a Freelance Writer: November Income Report from Nicole Dieker

A good freelance career will last a long time — which means we need to prepare for the lean years, as well as for our golden years.

With that in mind, here are my numbers for November:

Completed pieces: 50

Work billed: $10,150.33

Income received: $7,789.40

In October’s income roundup, I noted that I had hit a new freelancing milestone: earning more than $10,000 in a single month. I also billed over $10,000 of income in November, but I won’t receive all of the payments until mid-December.

I am well aware that these high earning months won’t last forever; this income milestone is tied to a large project that will complete at the end of 2016, and after the project ends my monthly income is likely to dip into the $5,000-$6,000 range for a few months.

This upcoming income drop isn’t worrying me, though. Boosting my earnings in 2016 enabled me to pay off all of my outstanding debt, as well as build up a four-month emergency fund. These two actions did as much to help my freelancing career as anything else I did this year.

Saving for the lean times

Prior to becoming debt-free, I was putting 20 percent of my pre-tax income towards debt repayment — which means that if I earned $5,000 in a month, $1,000 of that would go straight to debt.

Now that I’m debt free, I get to use that 20 percent of my income for other things, which means I can earn a little less as a freelancer and still feel like I have the same amount of spending money.

Plus, having an emergency fund means I have cash in the bank to help me during an emergency or a lean period. I don’t anticipate a true lean period coming any time soon, but as we all know, freelancing is often unpredictable!

Most importantly: earning enough money to pay off my debt and save up an emergency fund means that I have more financial room to make choices about my career. I don’t have to take any job I can get, especially if the job is low-paying or is unlikely to benefit me long-term. I have the freedom to choose who I want to work with, which is likely to lead to better client relationships and higher earnings in the future.

Saving for retirement

On the subject of “the future:” the other thing I’m doing with my $10,000 monthly paychecks is setting up a retirement fund.

I have an active 403(b), thanks to the four years I spent working at a nonprofit before I became a freelancer, but I can no longer make contributions to that accountwhich means I need to start putting my freelance earnings in a new investment vehicle.

Why did it take me so long to start thinking about saving for retirement? Well, I’ve been thinking about it the entire time; it’s just that I wanted to use my freelance income to pay off my debt first.

Since I write for personal finance sites, I know there are advantages and disadvantages to paying off debt before saving for retirement, versus putting a little money into a retirement account now and paying off debt more slowly. In my case, especially because I already had the 403(b) set up and earning interest on prior contributions, it made sense to pay off the debt as fast as I could.

At the beginning of 2016, I did the math and figured out how much I needed to earn to set aside $5,500 to put into a Roth IRA. I know that freelancers can also make contributions to a SEP IRA, and instead of being limited by the Roth’s $5,500 annual contribution maximum, freelancers are allowed to contribute a larger percentage of their income — this’ll vary depending on the type of business structure you have, so talk to your CPA to see how a SEP IRA might apply to you.

I am going to talk to my CPA about SEP IRAs in 2017. However, this year I knew I wouldn’t be able to save much more than the $5,500 contribution to the Roth IRA, which is why I set it as my retirement savings goal. As you might remember from my conversation with Gina Horkey, we’re more likely to reach our goals if we know they’re something we can realistically achieve.

Which means that I’ll have $5,500 set aside by the end of the year, thanks to those last few big paychecks, and I’ll use it to restart my retirement fund.

I’m not planning on 2017 being a “lean year;” I can’t predict which freelancing projects I’ll be offered, but I can anticipate that I’ll continue to work with the majority of the clients I’ve been working with in 2016, and that I’ll continue earning at least $5,000 a month or more. If I need to make some difficult choices, I’ll have an emergency fund to back me up; if I have another high-earning year, I’ll be able to put more money towards savings and retirement.

What about you? How are you using your freelance earnings to prepare for the future? I know that not everyone is earning enough money to pay their own bills, much less save — that’s how I got into all that debt to begin with — but if you are earning enough money to get by, how are you making sure that money will help you not just today, but also tomorrow?

Filed Under: Freelancing


  • Nelliane says:

    Hi Nicole, quick question .. for the purposes of taxation, do you report income received or work billed for the month?

    Thanks for the insight into your freelance career and here’s to your continued success.

  • Jackie Atwood says:

    My calculator shows you made about $156 per piece for around $7800 for Nov. While the overall total is great, the per piece number is not very impressive. 50 pieces over 30 days seems to be a lot of work. That is about 2 pieces a day!

    I’d like to know what pays you around $160 per piece and what subject or subjects you cover?

    My long form articles almost require a lot of research–visiting web sites; developing/sending emails to get responses to many questions as well as sometimes also requesting many photos and information for captions for the photos; phone interviews; phone followups to what I requested in emails; and often resending emails. I get paid much more than $160 per piece. But I certainly would consider getting around that amount if there was little research and quick writing.

    It may take me more than one week just to get the requested information and photos and caption data and then review it all, etc.

    So how are you able to collect a lot of information then sift through all of that data, decide what to use, and then to produce about 2 pieces a week and also to proof and edit them?

    I usually write and research long form ( 1,000 to 2,000 word pieces) for business publications that have web sites. I have never been a guest blogger.

    Do you do a lot of guest blogging?

    Out of curiosity, have you ever written for the following?

    PR agencies.

    Small to large companies.

    Major, well established consumer/business media, such as magazines for women.

    Trade publications.


    Business associations.

    Government consultants.

    I have produced stuff for all of them as a freelancer/staffer.

    Do you respond to ads on, com? I do.


    • Nicole says:

      I do in fact write two pieces a day for The Billfold, in addition to the pieces I’m working on for other sites like The Write Life! The short version is that I’ve learned how to research/write/edit very quickly.

  • Gina Horkey says:

    Congrats on becoming debt-free girlfriend – HUGE!

    Decreasing fixed expenses and having a cash reserve were both instrumental as I quit my day job two years ago (almost to the day!).

    We took out a loan to purchase a piece of property last year and hope to have it paid off a year from now, which will put us back to being debt-free (sans our regular mortgage of course).

    PS: Thanks for the shout out. 🙂

  • The retirement stuff is good info for any freelancers who haven’t thought out this yet, but I’m wondering how you’re handling health insurance? Health insurance is perhaps the biggest reason my wife and I haven’t yet taken the plunge and left our day jobs to pursue our writing dreams.

    Thanks for another inspiring post, btw.

    • Nicole says:

      I have health insurance through the Affordable Care Act. It’ll cost me nearly $300 a month next year, even with a Bronze plan, but I figure it’s a good investment.

  • Thanks for the insight, Nicole, and congratulations on paying off your debt! That’s what I’m doing with any income I can spare, paying off the last of those student loans. I put my 403b contributions on hold for a few months so I can focus on paying off the debt as well. Like you said, there are positives and drawbacks to that, as there are with everything 🙂 Also with this being my first year in full-time freelancing, I’m waiting to see what the tax situation will be like before I spend money on pretty much anything!

    Thank you for sharing! It’s definitely good to be reminded of saving, especially during the holidays…

    • Nicole says:

      You are very welcome! Setting aside 10% of my income for saving was one of the smartest things I did as a freelancer—and at this point I’m setting aside 25% for taxes and should probably start setting aside more.

  • Wow, Nicole! This sure is impressive.

    At the moment I’m trying to decide what to focus on to boost my earnings from writing. I have a gig that’s freelance but not strictly writing, which I am mainly relying on for my income. I’m investing some of this income into two online courses, both to investigate future writing carer possibilities and to motivate me to finish a novel I’m currently writing. I’m also working to pay off student loans, but I know I need a more stable source of income to be able to save. For that I might go back to a more traditional work situation, but only if it’s something that will use and develop my skills further.

    Thanks for the report!

    • Nicole says:

      You are very welcome! Here’s some advice:

      1. Keep pitching
      2. Use the gig you’ve got right now to get your next gig (can your client recommend you for another position? can you use this portfolio of work to apply for a similar job?)

      Best of luck!

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