Contracting is a desirable lifestyle for many, but the lack of consistent income can be enough to deter workers from the stability of full-time employment. If there is a gap between your contracting roles, your finances can often become stretched.
But with some careful planning, you can save money and make your wages go further. We’ve listed some of our top tips for managing your money between contract roles.
Know what you’re spending
The most important step in managing your money is to be aware of what you’re spending. It can be too easy to spend without regard and end up with no idea where your money has gone.
Get into the habit of keeping all of your receipts so you can see exactly where you’re overspending. This will also allow you to slash any unnecessary expenses and keep a realistic budget.
Make a budget and stick to it
Knowing your outgoings each month will help to plan and budget, even during the months when your workflow has dried up. Making a budget plan will help to make sure you don’t overspend each month and don’t spend beyond your means.
You should aim to make a list of every outgoing so you know exactly how much of your earnings will need to be spent and the amount you will have left over. For a more detailed account of your take home pay, try our interactive calculator.
Be aware of what you can claim
One of the benefits of being a limited company director is the ability to claim tax relief on a number of expenses and being aware of the savings you can make means you can take home more of your salary at the end of each month.
Under certain circumstances, you can claim back the cost of a number of everyday expenses such as travel, accommodation and the cost of meals. You will, however, need to ensure that these expenses are recorded. For details about what you can claim, you can consult our guide to expenses.
Consult advice from your accountant
Your accountant at Nixon Williams will always be on hand to provide support with your finances and offer any advice. To get in touch, simply call us on 01253 362062 or email email@example.com.