Freelancing in Europe is great because it gives you freedom, but it also means you have to take responsibility for your own finances. If you don’t have a steady salary, paid leave or social benefits, it’s really important to keep an eye on your money and make sure you’ve got enough for when you’re between projects. So, how can you stay on top of your finances and keep your money stable? Let’s have a look.
Separate personal and business finances
One of the biggest mistakes freelancers make is mixing personal and business expenses. This can cause financial chaos, making it tricky to keep track of earnings and expenses.
What to do:
- Open a separate IBAN account for freelance income. A convenient option is the CFPS account, which allows to manage finances without hidden fees.
- Use accounting tools or even a simple Google Sheets spreadsheet.
- Pay yourself a fixed salary every month while keeping the rest for business expenses.
Always set aside taxes
The tax rules for freelancers in Europe are a bit of a mess – it depends on the country. But there’s one rule you can always rely on: whenever you get paid, you’ve got to set aside some of it for taxes. If you don’t, you might get an unpleasant surprise down the line.
How to stay on top of taxes:
- Determine the percentage of your income needed for taxes (typically 20-40% depending on your country and tax regulations).
- Open a separate savings account and transfer your tax portion immediately upon receiving payments.
- Consider using tax services to calculate and file taxes accurately.
Build an emergency fund
When you’re self-employed, your income can be a bit hit and miss – sometimes you’re really busy, sometimes not so much. So it’s a good idea to plan ahead to avoid any money worries.
How to build financial security:
- Start by saving enough to cover 3-6 months of living expenses (rent, food, bills, etc.).
- Keep your savings in a high-yield savings account or conservative investments like bonds or dividend stocks.
- Automate your savings by transferring 10-20% of every payment into a separate emergency fund.
Plan your income and expenses
Freelancers often struggle with cash flow. Without a financial plan, you might find yourself out of money before the next client payment arrives.
How to stay organized:
- Create a monthly budget to track expected income and expenses.
- Work with upfront payments — request a 50% or even 100% advance for smaller projects.
- If you work with multiple clients, track who owes you what and when payments are due using tools like Trello or Notion.
Leverage financial tools for growth
Freelancers should not only focus on earning but also on managing their money wisely. The sooner you start thinking about financial growth, the more stability you’ll have in the long run.
What you can do:
- Open a CFPS IBAN account to receive international payments in multiple currencies without excessive fees.
- Learn about investing — even a small portion of your income can work for you (ETFs, real estate, crowdfunding).
- Take advantage of cashback cards and rewards programs to save on recurring expenses like subscriptions, advertising, and software.
As a freelancer, financial stability isn’t about luck – it’s about smart money management. Separating your accounts, planning for taxes, building savings and using modern financial tools will help you stay in control and grow your income.
Looking for an easier way to handle payments? Open an IBAN account with a CFPS card – a simple solution for receiving payments and managing your freelance finances hassle-free. It only takes 10 minutes to get started and allows you to be in control of your money no matter where you go.
