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When I started freelancing, I figured my operating costs would be low. No office rent to pay. No staff. No inventory to manage. Several years later and I am still surprised that my monthly business expenses are in excess of $1,000. The last time my expenses dropped below $1,000 was July of 2014, so this is a consistent figure. (This does not include mortgage, groceries, leisure travel, or personal expenses.)

So what exactly costs four figures monthly? I asked myself this question last week as I entered my expenses into QuickBooks. (Confession: I had not entered my expenses since February! All caught up now.) My most expensive month this year was March at $1,957.64. And July was not far behind at $1,892.25.

Auto

One of the things I love about QuickBooks is the fancy chart option:

writing expenses

July 2015 Expenses

Last month was a pricey month for car maintenance. I use my car exclusively for business so all of my mileage/gas, repairs, registration, insurance are deductible. Of the amount above for July, $1,085.95 was for auto-related expenses, which includes gas. My car was due for routine maintenance and needed a new timing belt, water pump, and thermostat. Since my love is so handy and knows everything about cars, I saved $2,000 by not paying for labor at an auto shop. Instead, I paid $192.42 for all of the parts. Sadly, my love accidentally punctured my radiator while installing the other parts – so an additional $185.95 was required for that part. After all the parts were installed all was well…but then my car started driving shaky…turns out a bubble formed on the tread of a front tire. Two other tires were nearly bald and had old plugs; I decided to replace ALL of my tires for $617.96. Since our friend works at a car dealership, I brought my new tires over and he installed, balanced, and aligned them for a pizza. 🙂

Speaking of food – business meals and entertainment can add up for some people. These are generally one of my smallest expenses though. Auto expenses are consistently the strongest wallet strain. For you freelancers residing in metropolitan spaces who live car-free, enjoy it!

Travel

asheville writing workshop

Asheville Writing Class

Consider the costs of flying to attend conferences, hotels for conferences and out-of-town writing classes, subway and train fare, driving to business meetings, and meals while away from home. Fortunately, business travel expenses are deductible. Although the out-of-pocket expense is immediate, once tax season rolls around it helps reduce my taxable income.

Utilities

After my car and travel expenses, utilities are my next biggest expense. Internet (plus Internet expenses when not at home), electric, phone…for all of my at-home utility expenses, I deduct a percentage based on the square feet ratio of my home office to our home.

Insurance

My professional liability policy is an annual fee of $360.00. My health and dental insurance is a combined cost of $259.69 each month. All of these fees are 100% tax-deductible as well. (I noted auto insurance in the respective section above.)

Memberships, Conferences, Subscriptions, Submissions

american society of journalists and authors conference

Writer Conference

Between the various writing and business groups I maintain membership in, the conferences I attend, paying Meetup dues, and the digital and hard copy subscriptions I maintain for magazine and literary markets, I might spend anywhere between $200-$1,000 in a single month on these items alone. Don’t forget submission fees for contests and literary journals!

Supplies

writing events

Flyers from VistaPrint for under $20.

The needs for printer ink, paper, stationery, flyers for workshops, business cards, new Moleskines, and all of your standard office paraphernalia fluctuate over time. I Google promo codes for VistaPrint before I place any orders, and I make all of my Staples orders through the Southwest Rapid Rewards Shopping site. If you have a RR account, you can login and then find Staples and other vendors listings, then click through to their site to get points (multiple points in most cases) per dollar spent added to your RR account. My love makes so many purchases from Lowes Home Improvement and Sears that he earned more than 14,000 points this year alone – which means his next flight is free.

Miscellaneous & Ads

freelancer laptop

Computer screen repair!

Don’t forget, I pay guest contributors on Write Naked. 🙂 I also buy educational books on writing, business development, and marketing, as well as attend classes and workshops to further advance my writing and skills. Remember when I broke the LCD on my laptop earlier this summer? My new screen cost a mere $50. Aside from these costs, I run a few classified ads when I have an upcoming class too. Once again, entirely deductible.

What is your biggest financial drain as a freelancer?

NOTE: As is the nature with anything related to taxes and finance, speak with a Certified Public Accountant or tax attorney for legal advisement specific to your unique situation. Be advised that I am not an expert in the tax field and none of what appears here is intended as legal or financial advice. The information here is provided to help writers consider important matters that may affect their respective writing businesses.