How to Achieve Financial Discipline In the Gig Economy Era
For a while now, the thoughts rattling around in my head have been on how I continue to be broke even when I seemingly get a number of gigs flooding in. How can I leverage my time to not only grow my business knowledge in the growing technology dynamism but to also strike a balance without suffocating my finances?
I’ve been puzzled for months.
In the words of Robert J. Shiller, author of Finance and the Good Society, he said; The financial crisis is a growing pain, the kind of accident that happens as we develop and move forward. There was too much complacency about existing institutions. Our reaction to the crisis should primarily be to develop fundamental financial innovations that better serve our real goals.
When you are operating in the gig economy, as many of us prefer to do lately, there is a huge gap and communication with ourselves and financial literacy. To contextualize this, there are many entrepreneurs, investors and others who struggle to prepare and understand financial information.
Without a doubt, I am among them!
“Finance is not merely about making money. It’s about achieving our deepest goals and protecting the fruits of our labor.” — Robert J. Shiller
Today, there are a number of apps to help you track your spending and to constantly remind you if you are exceeding your threshold but still, it takes one’s discipline to respect what these apps tell us and follow them diligently.
When you are in the gig economy, chances are you are your everything; your own boss, your own finance manager and you run to yourself for financial advice & literally anything and usually this is so because you can’t afford to hire professionals to do this for you.
Before you know it, all these roles get overwhelming for you to handle and you are constantly going to breakdown because something isn’t going as planned or you never had any plans at all.
To flourish in a gig economy, you need to have the highest degree of financial discipline in order to sustain yourself until the next paycheck comes in. When you fail to plan financially, chances are you will always find yourself broke and you will often be desperate to the point of taking on work with mediocre pay.
The beauty with operating as a freelancer is that you have immediate and unlimited access to all your money and you can do what you want at any time without having to wait for salary or anyone. However this raises the levels of temptations to spend it rather than saving it and to be able to balance the two, you will need a great skillset of financial discipline.
When you are financially disciplined, plan for your money quite well and drop a spendthrift culture, you will realize a great amount of financial freedom.
How to Achieve Financial Discipline
Achieving financial discipline is one of the hardest things to pull off as a freelancer especially when you are everything in the ‘business’. You are not too sure about what to buy and what not to, whether to take that trip to Bali or Hawaii without crippling your bank account.
However, arriving at such a stance to manage your finances well and achieve both financial disciplines (Financial Freedom & Financial Literacy) is not only crucial for yourself but also for your business. When you are the strongest pulse of your business, It’s important that you plan your long-term financial situation by actively saving for a rainy day or retirement.
Set financial goals and targets for yourself and abide by them.
Managing finances is heavily dependent on your plans to do so. There is a need to come up with a straight and clear plan for your finances and how to manage them without running on credit or a completely empty bank account. Start by setting short-term goals and slowly transition to the long-term goals and they should be realistic.
Join an Investment Club or Savings and Credit Cooperatives Societies
It’s likely you are not the only one suffering from financial indiscipline and even after you made money last week, you are now wondering what happened to all the money you made. How about you join an investment club to ensure that you may wake up one day and your money has made you lots of more money?
Investment clubs provide the opportunity for its members to share the load and pool their knowledge to learn more — with less time and effort — than they can on their own. Clubs are an excellent way to stay focused, gain experience and accelerate investment learning.
On the other hand, cooperatives encourage its members to save money and enable them the obtain loans they may require for various purposes from their accumulated savings.
Restructure your lifestyle
If you are a bonafide spendthrift or an impulsive buyer, you are going to have to restructure your flashy lifestyle is to tame your risky spending. I know how it can be quite tempting to buy the latest iPhone or change to new wheels but that only brews a financially demanding lifestyle that will leave you financially crippled.
Live within your means
You can’t be partying every other weekend or hopping on every trip when you know this will possibly affect your finances. Living within your means and planning your spending accordingly can give you enormous chances of financial freedom. Living outside your means is usually catalyzed by peer pressure from your mates and because you want to fit in, you are tempted to spend outside your budget. This is risky.
Blog #005- This blog is part of the 100days, 100blogs challenge and you can follow more of these at the Dare To Write Publication