{"id":16677,"date":"2015-09-21T22:00:24","date_gmt":"2015-09-22T02:00:24","guid":{"rendered":"https:\/\/www.wework.com\/creator\/?p=16677"},"modified":"2020-03-30T23:19:23","modified_gmt":"2020-03-31T03:19:23","slug":"freelancers-these-5-tools-will-save-your-life","status":"publish","type":"post","link":"https:\/\/www.wework.com\/ideas\/professional-development\/freelancers-these-5-tools-will-save-your-life","title":{"rendered":"Freelancers: These five tools will save your life"},"content":{"rendered":"

Quarterly taxes, legal contracts, invoices, health insurance?<\/p>\n

I didn\u2019t sign up for this.<\/em><\/p>\n

If you\u2019ve freelanced before, chances are high this thought has run through your mind. A few months after moving to the Bay Area, I tried to teach kayaking full-time as a freelance instructor and 1099 contractor. I was 23 and had no idea how to do taxes period, let alone quarterly taxes.<\/p>\n

Flash forward three years: I\u2019ve learned a lot about my own freelance practice (now both kayaking and marketing), plus I\u2019ve also worked for companies that specialize in helping freelancers with their finances. There are a lot of tools out there geared towards helping independent workers, but not all of them provide real value. With this in mind, here\u2019s a rundown of the best tools that can save you time, money, and sanity.<\/p>\n

1. Stride Health<\/strong><\/p>\n

Let\u2019s start with the essentials: taxes and health insurance. If you are freelancing and don\u2019t stay on top of both, you will risk paying fines. I\u2019m continually shocked by how many freelancers opt to waste money on tax penalties instead of getting health insurance. In 2016, you will face paying 2.5 percent of your income in fines if you don\u2019t obtain health insurance! Stride Health<\/a> is a company that curates and manages health plans specifically for independent contractors. They help you understand the full terms and costs of plans in your area.<\/p>\n

The only serious injury I ever endured while kayaking? A perforated eardrum. Guess what? I didn\u2019t have insurance, and it cost $600 to have a doctor confirm there was a hole in my eardrum. Given my income at the time, I qualified for a plan that was $55 a month. For the cost of one doctor\u2019s visit while uninsured, I could have afforded an entire year of subsidized health insurance. Please get insured!<\/p>\n

2. Qapital and Painless1099<\/strong><\/p>\n

As a good rule of thumb, you should set aside around 30 percent of each paycheck for quarterly taxes. And similar to health insurance, if you don\u2019t pay quarterly taxes when you should (or underpay), then you risk a penalty of up to 10 percent of what you owed (if you owe $3,000 in taxes, that\u2019s $300\u2014yikes).<\/p>\n

When I was a full-time 1099, I sometimes didn\u2019t know if I could afford rent, let alone afford a certified public accountant to help me figure this all out. Thankfully, two great apps have emerged to help freelancers budget for quarterly taxes. Painless1099<\/a> lets you connect your bank account and sign up for a withholding account where 30 percent of your earnings (give or take) will automatically be put aside for taxes. Qapital<\/a>, the Swedish-born budgeting app, just launched a freelancer-focused savings rule to automatically put aside 30 percent from your checking account into a separate account for taxes.<\/p>\n

3. Payable<\/strong><\/p>\n

I once used a time-tracking app to generate invoices required by the company I contracted with. I\u2019d email my invoice to the company\u2019s payroll person who then printed a check which was mailed to my house. The entire process took two months. By the time the check arrived, I had already moved to a new apartment. Turns out this is a widespread problem: In New York state alone, researchers estimate<\/a> that $3 to 5 billion in freelancers\u2019 wages were lost because of clients simply not paying and the opportunity cost of time spent chasing payments.<\/p>\n

Payable<\/a> is an app that solves this exact problem. Freelancers can use it for work-tracking, invoicing clients, and ultimately getting paid faster. You can log your time (or project), invoice clients, and transfer funds via direct deposit all within the app. It also automates reminding and following up with clients who have yet to pay. There\u2019s a one percent transfer fee for direct deposit, lower than Paypal\u2019s 2.9 percent, and payouts are three to five days. Another option is for your clients: they can approve your invoice and pay online via direct deposit for a flat rate of $8 per month. At the end of the year, they\u2019ll also be able to auto-generate and file a 1099 for you.<\/p>\n

4. Bonsai<\/strong><\/p>\n

When I began freelance writing and SEO consulting, many clients requested a contract. I had no idea where to begin and probably created some documents of questionable legality. Bonsai<\/a> is a tool that easily creates and customizes freelance contracts. It also takes care of e-signing. Make sure you have a contract, even if a client doesn\u2019t request it.<\/p>\n

5. LegalZoom\u00a0<\/strong><\/p>\n

Many full-time freelancers form a Limited Liability Company <\/a> for their freelance work\u2014 and with good reason. Establishing an LLC can protect your assets from liability (in the case you\u2019re sued by a client or have outstanding business debts), reduce the amount you owe self-employment taxes on, and elevate your personal brand. There is an upfront cost to establish one and additional annual fees for maintenance. But, if freelancing or your personal business provides the majority of your income, then it\u2019s a worthwhile investment. LegalZoom<\/a> is one company making LLCs more affordable (pricing plans start around $149), and they help you follow up with annual filing while providing additional support.<\/p>\n

Photo credit: Lauren Kallen<\/p>\n","protected":false},"excerpt":{"rendered":"

Quarterly taxes, legal contracts, invoices, health insurance? I didn\u2019t sign up for this. If you\u2019ve freelanced before, chances are high this thought has run through your mind. A few months after moving to the Bay Area, I tried to teach kayaking full-time as a freelance instructor and 1099 contractor. I was 23 and had no […]<\/p>\n","protected":false},"author":1552,"featured_media":16687,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[43902],"tags":[],"class_list":["post-16677","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-professional-development"],"acf":[],"yoast_head":"\nFreelancers: These five tools will save your life<\/title>\n<meta name=\"description\" content=\"Quarterly taxes, legal contracts, invoices, health insurance? I didn\u2019t sign up for this. 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