To follow up on yesterday's post, let's talk a little more about how to set up your work to make cash flow more serene.
We've already covered how to create a cushion for your self with spending.
Now, let's talk about how to create a mix of clients to address cashflow and sustainability of your self-employed career. If you've been doing this for any length of time, you may already know this stuff. I hope this can be helpful, though.
When I started freelancing, I set out a plan:
* Find clients that pay quickly
In Six Figure Freelancing, Kelly James-Enger suggests finding clients who will pay you quickly to shore up any holes in your cash flow. Often, these are low paying clients. But if you can form a regular relationship with them, you'll have money to pull you through. And you'll have a guaranteed base of income, at least for a while.
* Find clients that pay well:
Ideally, these would be the same as the first, but many clients, I find, pay slowly if they pay well. But if you've got a balance, it won't matter much. The important thing here is to find several of these.
When you're starting out, it's easy to feel relieved when you've found a client that pays you a livable wage, but sadly one is not enough. If something happens to that one client, you're left scrambling and feeling, perhaps, like you're not being a good steward to yourself and your business.
One person I talked to recommended having no one client represent more than a quarter of your income in any month. The reasoning? A quarter of your income is easier to make up or cope with in a month than 3/4th of your income.
* Try trial and error:
Having said all this, I've found that experiencing the ebbs and flow of business naturally guide me to what I need to do to shore up cash flow. So be proud of that Big Fish client, and if for some reason it doesn't pay as expected, feel what it's like to scramble to replace most of your feelings. Create awareness by doing a written check in, meditate or at least take a day to experience what it feels like in your body, and then take the next step: seek out other abundant clients, follow up on pay, figure out what happened and add it to your list of situations that can--and will--happen in your professional life. And then accept it.