5 ways financial planners can help freelancers and creatives build wealth

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• Freelancing creatives might want to consider working with a financial planner to keep their money goals top of mind.
• A financial planner can help with budgeting, tax strategies, and retirement planning.
• Financial planners also can provide guidance on optimizing life, health, and disability insurance.
• Looking for a financial planner? SmartAsset's free tool can help you find a professional to help with your money goals »

Freelancing creatives and artists have a bad rap when it comes to money.

Many of them shun it, avoid dealing with it, or aren't sure how to make more of it. As I'm working toward being a financial coach to help creative freelancers and artists, I've found that many creatives such as myself aren't necessarily "bad with money." They might feel overwhelmed or confused about how to best manage their finances. What's more, they face challenges that, say, wage earners don't.

I asked Tyler Dolan, a certified financial planner and president at Keenan Financial, to explain how, exactly, a financial planner can help freelancers and creatives with their money:

1. Create a spending plan for inconsistent income

Since most bills are due monthly - rent, utilities, debt repayment, subscription services - it's far easier to build a budget if you're working for a company collecting a steady paycheck. As freelancing creatives are typically paid on a contract basis, and are subject to "feast or famine" cycles, their income is oftentimes variable. As you might imagine, budgeting when you're an artist or freelancing creative can be much more challenging.

"Working with a financial planner to create a budgeting system can smooth out the process and help creatives feel more confident in their budget," says Dolan. Because you might have challenges that are unique to gaps in cash flow, a financial planner can help you come up with a spending plan that's tailored to your particular situation.

2. Help with your retirement goals

When you work for a company and are on salary, it's a lot simpler to save for retirement. By participating in an employer-sponsored retirement plan like a 401(k), you can automatically deduct contributions from your paycheck, and take advantage of any employer matching contributions.

It's not nearly as simple for creatives. You have to do your homework to figure out what the best retirement accounts - or mix of accounts - are right for you. Should you go with a Traditional or Roth IRA, a Solo 401(k), SEP IRA, or a few? As for Health Savings Accounts (HSAs), should you use the funds as a vehicle to save for retirement?

Plus, you have to do the legwork of setting up the accounts and contributions. "A financial planner can help creatives identify the 'best fit' retirement plan and make sure they're saving enough to reach their retirement goals," says Dolan.

Looking for a financial planner? SmartAsset's free tool can help you find a professional to help with your money goals »

3. Come up with tax strategies

Taxes and freelancing can be complicated, to say the least. When you work for someone, you have your taxes withheld from your paychecks. For most freelancing creatives, there's no automatic tax withholding system, which can become a headache once it's time to file your tax returns.

Many freelancing creatives struggle with figuring out exactly how much to set aside for taxes. Plus, if you're self-employed you'll need to pay quarterly taxes and self-employment taxes. What's more, if you have a part-time job and have freelancing clients, you might get both 1099 and W-2 forms. Confusing? You bet.

"A financial planner can help creatives estimate their annual tax liability and recommend a payment plan throughout the year," says Dolan. "They can can also help creatives maximize their business deductions to optimize their tax situation."

4. Optimize insurance

Financial planners can also help demystify the perplexing puzzle that is purchasing insurance. Some employers offer a certain amount of group term life insurance gratis, or offer a group discount. Not the case for creatives. We have muddle our way through purchasing life insurance, and pay for it on our own.

Speaking of insurance, we have to figure out whether we should get short and long-term disability insurance. I'm currently figuring out how I can opt into the State of California's short-term disability insurance as a self-employed individual. It's confusing, complicated and time-consuming.

And of course, there's health insurance. Whereas it's easy to hop on an employer's health plan, how can creatives make sure they have optimal coverage that's right for their lifestyle, situation, and budget? There's where a financial planner comes in.

5. Help you prioritize your financial goals

When we're buried in deadlines or knee-deep in the hustle, it's easy to push your money goals to the back burner. Meeting with a financial planner on a regular basis can help you make sure your money goals stay top of mind, and that you're on the right track.

Many of us might not feel like we know enough, or just terrified of making the wrong decision. Having a trusted professional financial planner on your side can help alleviate your fears and provide proper guidance.

Looking for a financial planner? SmartAsset's free tool can help you find a professional to help with your money goals »

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