Keeping track of your finances is especially important if you’re a freelancer- after all, you don’t tend to receive paychecks in the same way you would in a more structured setting. The job of tracking your finances- ensuring you’ve been paid your due in a timely fashion- is entirely on you. No one’s going to come to you and let you know that you forgot to send out an invoice, or tell you that business A neglected to pay you this month.

While there’s plenty of software out there that’ll keep track of your finances for you, you don’t actually need to get too fancy in order to properly monitor your funds. All you need is Microsoft Excel, a few spreadsheets, and a little bit of time to set everything up. It’s quite simple to do, and trust me, you’ll be glad you did it.

Do note that I’m going to be detailing the simplest method. There is a way to set up a more advanced ledger via the use of boolean statements, but we’re going to keep away from that for the time being- the method I’m outlining below should work just fine.

Of course, you don’t need to be a freelancer to find this useful. Everybody could do with keeping track of their income and expenses, particularly with the tough times we’ve been living in of late.

Creating the Framework

First things first, you’re going to want to create a spreadsheet with several columns: Client/Project, Amount Owed, Date Submitted, Date Paid. Amount Paid Be sure that Amount Owed and Amount Paid are both formatted to “currency.” At either the bottom of the spreadsheet or off to one side, write “TOTAL OWED.”  Near that, type TOTAL PAID. Be sure to leave some space either above or below the two TOTALS cells.

Next to or below “TOTAL OWED,”type =SUM(. Once you do this, hold down shift. Click the first cell in the Amount Owed column, then click the last cell, and hit enter. Do the same thing for the cell near TOTAL PAID and Amount Paid. Finally, subtract the cell under TOTAL PAID from the total owed. Your final formula under TOTAL OWED should look something like this: =SUM((E2:E7)-F22)

Tracking Payments

Again, this is a fairly brute force way of doing things…but it works. Simply enter in the date you were paid along with how much you were paid, and the formulas you’ve entered should take care of the rest.

Tracking Expenses

Click over to the second sheet in your workbook, and keep track of your daily expenses in it. Whenever you spend something, note how much you spent next to the day you spent it. At the bottom of this page, you should set up another space that totals up how much you spent. Finally, set up another cell that tracks your total income. In the cell that tracks income, type something like =SUM([cell in which you're tracking your total paid]-[cell in which you're tracking your total expenses]). Ultimate, you should come out with a formula that looks something like

=SUM(Sheet1!F22-E2).

That’s pretty much all there is to it. Again, it’s a bit simplistic, and definitely not as advanced as you can get…but it works. At the end of the day, that’s what’s important, right?

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