Freelancing has spread worldwide - especially during the pandemic - and for many, it has consolidated as a way of achieving professional happiness and independence. That's why our guest expert Mirko Ciesco will explain to us the fundaments and benefits of using Financial Management Dashboards.
By Mirko Ciesco - Of course, there's no point in hiding the truth: freelancing also brings a lot of hassles and stress. Countless variables are involved in allowing a freelancer or entrepreneur to work fluently and henceforth: with a smile always on one's face.
The factors that seem to contribute to this joyful mood during freelancing are mainly two: improving one's work efficiency and being able to choose clients to work with in serenity. These clients are the ones who, when the video call ends, let you know that you are on the right path.
To ensure this happiness, people like me who freelance in remote working - that is, via laptop, smartphone, and an Internet connection - must get increasingly good at keeping track of all their business information, especially information about income and expenses.
Doing this independently without a good tool is not easy. That's why I decided to design and develop a solution for these problems - first for myself, and later free for everyone - based on two tools we all know: Google Sheets and Google Data Studio (now Looker Studio).
In the next paragraphs, I will explain step by step how a Financial Management Dashboard will help you be a happy and satisfied freelancer.
The first function of a Financial Management Dashboard is expense tracking. If you have ever budgeted your business activity, you will know that knowing the main expenses is an excellent premise for increasing one's turnover.
The reason is simple: if we know how much we will spend on tools, training courses, office rent, etc., we can manage the annual budget without too much stress.
In my case, for example, spending planning allows me to define each year the budget to invest in creating content, images, blog articles, and advertising campaigns to promote my business.
Of course, thanks to the Dashboard, I can check in real time the difference between income and expenses and know if the accounts are in the black.
At the same time, with the Dashboard, I can monitor the revenue stream generated by projects month by month. As well as outstanding payments.
The main problem of any business - even a freelance business - is receiving payment from clients. Although we can protect ourselves through contracts, not everyone always pays on time. So what does one do?
Spending your days checking your bank account is certainly not a viable path. Therefore, I have included a formula in the Dashboard that shows me the number of days that have passed since the invoice date.
All are easily calculated through two fields: invoice date and payment receipt date, which I will share with my accountant for annual accounting management.
In Italy, when a freelancer goes on overload, we tell him or her, "Do you work to live, or do you live to work?" The sense is this: if you spend all your time working, you have none left to live your personal and family life.
Another perspective should be added: "You have to work happily to live happily" and take care of yourself. This is the point of view that I call work happiness in the dashboard because it tracks the level of joy during the year.
The result is a pie chart that makes happiness gluttonous, even if it is made of numbers and lines.
In the dedicated Google Sheets, I can indicate for each invoice my degree of happiness:
Through these variables, I created a pie chart that shows me three different colors of my state of happiness:
For a freelancer like me, working with peace of mind allows you to be more productive and spend time on training or creating personal projects.
By tracking income, expenses, and happiness levels, I can take qualitative and quantitative stock of my work each year-end. What does it do for me? To set new goals for the next 12 months (or more).
With the data from the Financial Management Dashboard, I can monitor the percentage of services I have performed during the year and see if the service that makes my heart race has a high value.
If it does not, I will be free to consider whether to invest the budget in its promotion and set a goal to increase the percentage of projects and happiness.
Consequently, an additional goal will be to increase turnover, which in the Dashboard will turn into a numerical value to be achieved. This approach will stimulate me throughout the year to give my best.
Self-employment has a significant advantage: being able to choose one's clients and work how, when, and where one wants.
With the enhancement of the Dashboard, I can dedicate myself not only to the best clients but also to training, which will help me increase my value as a professional and as a person.
I hope this Dashboard will inspire your work, making it happier, more fulfilling, and more rewarding.
Good Luck!
Mirko.
About the Author: Mirko Ciesco - Web Performer
Free tool: 🔥Dashboard for entrepreneurs🔥
I enjoy collecting data from sites to understand how to take them to the next level! 🚀I am an expert in web performance, optimizing technical SEO, and improving website usability through web analytics. I create winning strategies from the problems of startups and companies. Finally, I teach custom courses online and throughout Italy with the mission of making the web a better place.
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