Financial planning is different for independent professionals Freelancers and independent...
You know your domain inside and out. You can solve complex problems, deliver meaningful results, and command respect in client meetings. But when it comes to setting your rates, tracking income across variable projects, or planning for the inevitable dry spells? That confidence evaporates.
Most independent consultants excel at their craft but struggle with the financial mechanics that make independence sustainable. You're not alone if you've found yourself wondering whether you're charging enough, scrambling to understand your actual monthly expenses, or lying awake worrying about cash flow gaps between projects.
Finance expert Mariam Umarji, who has 15+ years advising governments and international organisations, offers a different perspective: your pricing, budgeting, and cash flow aren't just operational details - they're mindset levers. These financial systems directly shape how you approach career decisions, build confidence in your value, and develop the power to say "no" to work that doesn't serve you.
Pricing - Start with intelligence, not instinct
When you're starting out, the easiest approach is comparing yourself against industry standards. But Mariam warns against simply looking at big consulting firms and assuming those are your benchmarks. Instead, she advocates for doing proper market intelligence.
"You need to find consulting standards that match your actual position," she explains. This means researching what consultants with similar experience levels, in similar markets, working on comparable projects actually charge - not what McKinsey partners bill.
But here's the critical insight: don't price based on what you need to earn. "It's not because you need to have a certain fixed amount of income every month that you will be able to charge for that. That's wishful thinking."
Instead, take the scope of work - whether it's a terms of reference, request for proposal, or detailed client conversation - and measure the level of effort required. Factor in your CV, your position in your career, and put forward pricing based on those fundamentals rather than your personal financial needs.
The hidden reality? When you're starting, you'll always spend double the time you estimate because you're learning, and clients will provide more feedback, requiring additional rounds of revision. Build buffers into your proposals - if a project should take 20 days, quote 25 or 30 days to give yourself negotiation room and realistic timelines.
Budgeting - Buckets, not perfection
Mariam takes a "bucket approach" to budgeting that acknowledges the complexity of independent work. "Budgeting and tracking spending are not the same thing," she clarifies. Budgeting is forecasting what you expect in expenditures and revenues over the next three to twelve months. Tracking is monitoring actual expenses against those projections.
Her framework includes distinct buckets: family costs, education costs, health costs, insurance costs, and company costs. Even as an independent consultant, you're still running a company that needs office space, electricity, internet, and professional tools.
The goal isn't perfect budget adherence - it's awareness. "I budget and then I try to get enough work that will cover for that budget plus a margin or safety margin that will allow me to have income even when there is no work or when work is slow or when clients are delayed in paying."
One major advantage of independent consulting is the ability to work multiple projects simultaneously. Use this to your advantage by maintaining different project timelines that create continuous income streams while you develop proposals for future work.
Cash flow - Building safety nets, not forecasts
Rather than trying to predict when money will arrive - an impossible task given project cycles and client decision timelines - Mariam focuses on building robust safety systems.
"You need to have an emergency fund," she emphasises. This isn't for splurges or opportunities - it's specifically for covering expenses during work gaps, late payments, or unexpected downtime. If you can set aside 10% some months, do it. When you have good months, increase it to 20% or 25%.
The key insight: plan your personal time off strategically and budget for it. Mariam takes December completely off when her children have school holidays, which means the other eleven months must generate enough income to cover twelve months of expenses.
Separate your business and personal finances rigorously. Have business accounts separate from personal accounts, and create clear rules about how much transfers from business to personal based on your family agreements and individual needs.
The practical tools that matter
Mariam is refreshingly tool-agnostic: "The important thing is that you have to build in the habit and the routine of doing it. The system is just a means to an end."
Whether you use Excel, Notion, or specialised apps matters less than consistency. Some consultants use apps with colour coding and tax tracking features, while others prefer simple spreadsheets. Choose based on your existing systems and budget.
For payment management, build penalty fees into your contracts. If clients don't pay within 30 days, charge 5% additional. At 60 days, make it 10%. Many jurisdictions already allow this - you just need to follow local laws and include these terms upfront.
The discipline of saying no
Perhaps Mariam's most valuable insight concerns boundaries: "With experience, the word you use the most every day and every time is no. Yes is an exception to the rule, actually."
This applies to scope creep, micromanaging clients, and projects that don't align with your values. When you have sufficient runway and emergency funds, you gain the luxury of choosing purpose over pure profit - but this comes with experience and financial discipline.
"Learning not to be afraid of no and not being too familiar with the yeses is important." Your financial roadmap should give you this freedom to be selective rather than desperate.
Your financial foundation enables everything else
About 75% of independent consulting work is management and administration, not technical delivery. Accept this reality and build systems that support it rather than fighting against it.
Your financial clarity isn't separate from your consulting success - it's what makes strategic decision-making possible. When you understand your real requirements and have built appropriate safety nets, you can evaluate opportunities based on fit and growth potential rather than immediate cash needs.
The goal is making decisions from clarity rather than fear. That starts by understanding what your business needs to provide for you, not just what clients expect you to deliver.
Ready to build your financial roadmap? Join the Outsized community to access expert sessions on consultant finances, connect with peers navigating similar challenges, and get practical tools for managing the money side of your independent practice.
