3 simple tips to take (immediate) control of your own income

As a solopreneur — or someone who’s still working full time while trying to make your hustle a reality — income tends to be one of your biggest concerns.

After all, we’ve all read news articles about how inflation diminishes our purchasing power. Many people are still feeling the financial crisis caused by the layoffs, furloughs or work reductions caused by the COVID-19 pandemic.

If you don’t have complete control over your income – and your finances as a whole – it can paint a pretty bleak picture. Fortunately, as an entrepreneur, you have more control over your income than most. It’s up to you to develop an action plan to increase your income and improve the way you manage your money.

If you’re still not convinced this should be a priority, these pressing reasons should do the trick.

1. If you don’t control your income, you don’t control your goals.

We all have goals for what we want to achieve in our professional career, personal life, etc. Like it or not, most of these goals will require money.

Want to travel the world? If you don’t control your income, you’ll struggle to save enough for international travel. Want to scale your business operations? The same principle applies.

As such, you need to set clear goals for what you want to achieve and then figure out what you need to do with your income to achieve them. Break them down into actionable steps you can take daily, weekly, and monthly, and you’ll be well on your way to achieving your goals.

Anthony Tedd, a successful business coach who has helped hundreds of entrepreneurs around the world, advises young entrepreneurs not to dwell on their prices. “Regularly, business owners give themselves a pay cut every year, if they don’t raise prices. No one goes into entrepreneurship with the intention of earning less year after year. Unfortunately, a significant percentage of them do just that,” Tedd says.

“Entrepreneurs struggle to raise their prices, both emotionally and practically. They pay a disproportionate price for it. In 10 years, some have literally gone bankrupt. To avoid this self-sabotage, one of the first recurring emails everyone should set up for their business is the “annual price increase” email. You don’t need to go into details, you don’t need to justify a price increase. Rising prices are an economic fatality. Add the percentage and leave it there,” advises Tedd.

2. You can’t rely on your boss to give you a raise.

Salaries have increased over the past year, especially as some companies have struggled to fill vacancies. But over that same period, inflation actually rose at a higher rate.

This means that people may technically be paid more, but their money still doesn’t go further. In many cases, even after an increase, people have less purchasing power than a year ago.

Of course, these factors are unlikely to convince employers to grant another raise. As a contractor, however, you have more power to set the prices for your work. You can set rates based on the value of what you provide when prospects come to you for a quote. Rather than working for an hourly wage, you can increase your earning capacity with value-based rates.

This way you dictate how much you earn, rather than someone else dictating it to you. You can increase your income right away, rather than waiting another year for employee reviews to arrive.

As entrepreneur and author Seth Godin said, “You can raise the bar or you can wait for others to raise it, but it’s raised regardless.” Here are some ways to make money online while increasing your value-based rates.

3. Taking control of your own income is the best way to manage your debts.

We’ve all heard the lectures about the dangers of going into debt for anything other than a mortgage. While that’s sound advice, it’s not the reality for most people. Unfortunately, it can be surprisingly easy to get caught in a cycle where you can never really get rid of that burden of debt.

Whether you’re still struggling to pay off your student loans or dealing with a huge credit card bill from business expenses, taking control of your income is the best way to make those problems go away.

This doesn’t just mean increasing your income (although that’s obviously a big step). Setting aside a fixed percentage of that money to pay off your debt each month will eventually give you more financial freedom by eliminating a stressful (and expensive) burden.

Eliminating debt also allows you to better manage the inevitable ups and downs that come with entrepreneurship. When these tough times come, you won’t have to worry about debts putting extra strain on your business.

It’s time to take control.

Despite the current global economic uncertainty, entrepreneurs and freelancers are better equipped than most to weather it. After all, you set your rates with customers. You decide which projects – and how many – to take on at any given time. You decide which investments can help grow your business and which are a waste of money.

Of course, you must be proactive in each of these decisions. Set clear financial goals, then take action to achieve them. If you don’t take control and let the market control you, you will only fall behind and struggle to stay afloat.