4 Smart Financial Tips for a Digital Marketer

4 Smart Financial Tips for a Digital Marketer

The world of digital marketing is exciting and ever-changing. What many digital marketers have in abundance in marketing expertise, they lack in financial prowess and understanding. Here are four great finance tips for digital marketers to help streamline their finances.

Keep Your Finances Separate

It is not uncommon for a digital marker to work in a freelance or independent contractor role. When working in this capacity, you must keep your business and personal finances completely separate.

The most important reason to do this is to do all your necessary tax planning correctly. Digital marketers want to ensure that all their income is accounted for when paying taxes. Just as importantly, they want to make sure that all of their business expenses get accounted for when computing taxes. 

When you merge your business and personal finances, distinguishing which is which can often be tricky. This problem can be especially true when trying to make these distinctions several months after the transactions occur. 

For digital marketers working for somebody else, it is always good to keep good records of business and personal expenses as well. In that way, you can track those items that you expect reimbursement for from your company.

Make a Plan for Retirement

For a digital marketer working for an agency or company, you may have access to company-wide plans to assist you in your retirement investing. For example, if your company offers a 401(k) plan, maximizing your contributions to this fund is always in your best interest.

If you work independently, planning for retirement can be more complicated and challenging. Independent digital marketers should look into retirement accounts like an IRA or a Solo 401(k). Just as with a plan offered by an employer, digital marketers should do their best to try to contribute as much as they can to this fund every month.

Map out a Plan for the Lean Months

There can be ups and downs in digital marketing, just as there are in any industry. As the overall economy slows, the need for marketing resources and expertise can slow as well.

As an independent digital marketer, this may mean less work is available to you. Even for those that work for an agency or company, there is always the potential for a furlough or a layoff when times get slow.

With that in mind, a digital marketer should create a budget based on their leanest months, not the most prosperous ones. If you constantly spend based on your highest income levels, you will soon find yourself running out of money. During these slow times, you may find yourself researching conventional loan rates to tide yourself over.

Do Not Forget To Set Aside a Little for a Rainy Day

Even when a digital marketer does a great job of contributing to a retirement account and operates on a sensible budget, there could still be emergencies to take into account. For example, if a digital marketer suddenly finds themself without any work at all, they need to be able to sustain themselves until the next gig. 

Having a dedicated emergency fund is an excellent idea for a digital marketer. In fact, it is a great idea to have a dedicated savings account just for this purpose. The trick for any digital marketer is to make sure that this money goes untouched unless it is absolutely necessary to do so. 

Just as with a retirement account, it is important to make regular contributions to this account. A good rule of thumb is to take a certain percentage of your income every month and put it into this account. Ideally, you would like to have the balance in the account cover at least three months of expenses. If your work level fluctuates greatly month-to-month, a more significant amount would be advisable. 

Working in the field of digital marketing is exciting and fast-paced and offers great opportunities for continuous work. Even with all these wonderful benefits, it is always wise to have a sound and reasonable financial plan.