Tallying Up My New Savings Plan: August Edition
Previously, on Nicole’s Budget: After discovering that I needed to save a lot more for freelance taxes than I had been previously saving, I set up a series of sub-savings accounts. Every Friday, I tally up all of the freelance payments I’ve received that week and put 20 percent towards taxes, 20 percent towards debt, and 10 percent into regular savings.
In August, I received $6,649.30 in freelance income. It was a very good month for me (see: “maybe I’ll spend the equivalent of a rent payment to visit Portland for a week”), and I am in theory going to get another $6,000+ in freelance checks for September.
Here’s what I put into my accounts this month:
Taxes got 20 percent, or $1,321.64
Debt also got 20 percent, or $1,321.64
Savings got 10 percent, or $664.82
(Percentages are slightly imperfect due to rounding, since I’d do the bank transfers and round off the cents at the end of each week.)
This meant I had $3,341.22 left over in my checking account this month. I did buy some new clothes and I took a trip to Intervention and also visited my sister and her husband, but I have a lot of cash left over even after that. I even have cash after putting down that $841 Airbnb deposit, $475 of which I am planning to get back since I am cutting my Portland trip down to three days.
It feels great to have a four-digit number in my checking account. It’ll drop back down to three digits when my rent payment clears, but then it’ll then bounce back up to four digits again when my Patreon payment lands in a few days. (I’m writing a novel on Patreon, in addition to the freelancing work I do for other clients.)
Essentially, I am starting the month with $1,300 in checking account cash. This is a huge deal for me, because I used to start the month with $30 in checking account cash. This is also a huge deal because it means I am well prepared to put down first/last/security on an apartment.
Plus, I have $2,169.44 in my savings account. This is the equivalent of a month-and-a-half emergency fund. It is also a huge deal for me.
So yes, starting this sub-savings plan was a pretty smart way to force myself to save. It helps that I am earning more money now, but it was even smart during the months where I was all “okay, I have to borrow from my savings account to buy groceries, but I’ll put it back when I get my next freelancing check.” (Which I did.)
How are your savings plans doing?