Managing Money Crucial to Earning from Gigs

“I switched from a full time content strategy job to freelancing in September 2019 only to earn enough for utilities while I was on a break to figure out the next step in my career. Come Covid-19 and I was flooded with freelance opportunities as companies began to warm to alternative work models. There’s no turning back since then,” she said. Seth’s average monthly income from freelancing has exceeded his last-minute, full-time salary.

She is part of a growing tribe of women who are shifting to the gig economy. Data from gig marketplaces such as Taskmo and GigIndia show a nearly 3-5-fold increase in sign-ups from female workers in flexi-work opportunities since the outbreak of the Covid-19 pandemic.

The trend has also given women on career breaks the opportunity to return to the workforce. “Between June and December 2020, we have seen an increase in applications from women in Tier-2 and Tier-3 cities. This proves that work-from-home (WFH) and flexible-job opportunities are proving to be a boon for women in tech who find it difficult to shift their base,” said Neha Bagaria, CEO and Founder, JobsForHer said.

Take the example of Agra-based Darshana Choudhary, who took a break from her five-year long marketing career in 2015. Since my husband’s business is established in Agra, I should not go to the metro. The remote work model brought about by COVID-19 has been a blessing to me,” she said. The 35-year-old recently signed a one-month contract with a tech startup for digital marketing projects.

Despite lucrative income opportunities, irregular flow of funds can be a challenge for freelancers. Although these women have prior experience in earning and managing money, their attitude Financial Planning Must be different, experts say.

Planning for Financial Insecurity in Freelancing: Priya Sundar, Director, PeakAlpha Investments, said, “Flexibility at work is great, provided you have financial security. Since freelancing does not ensure regular income and security, budgeting is of utmost importance. Set a bare minimum that you will need every time. months, which includes rent, EMI, working independently and expenses incurred on utilities.

This amount can be the benchmark for the income you need every month. More than this amount, you need to earn extra every month to build the buffer.

Praleen Bajpai, Founder, Finfix Research, said, “Since the monthly earnings are not fixed, it is important to create a buffer fund equal to approximately 12 months’ expenses. This will ensure that when your earnings are low during a few months or relapse from work Your overall lifestyle and financial planning is not affected.”

Only Seth knows this very well. “Of course, a steady monthly salary allays the fear of volatility and anxiety, which take a toll on freelancers during the lean months. Sometimes, when customers delay payments and one has to wait for weeks on end, it is very difficult to manage finances. “It is imperative for freelancers to save regularly to deal with the lack of security in working independently. However, with further planning by management, this becomes easier over time.”

Bajpai suggests keeping separate accounts for work and personal use. “A part of the earnings should be set aside for work related expenses and the rest should be treated as own salary and kept in personal use account. To ensure that this salary is sustainable, it should be based on average earnings and should be 15-20% less.”

“Once the safety net is established, you should plan for the benefits that come with a full-time job like EPF and medical cover and invest for your future,” he said.