Budgeting With an Irregular Income: Nine Key Strategies
Fortunately, taking the surprise out of irregular expenses is fairly simple. You just have to identify your irregular expenses, total their cost, and divide that total by 12 to turn them into a single monthly bill that you can include in your budget.
When someone has a predictable income it means that they know what they will receive, so they can make a budget for the next week, or month. Someone who has an irregular income would have to create a budget for a shorter time span, and would have to modify it more.
In EveryDollar, you'll cover your Four Walls inside the Housing, Transportation and Food budget categories. Under each category, you'll want to add budget lines by clicking Add Item and naming the line. (You can even use emojis!
4 Strategies to Manage Irregular Income
You might think expenses are expenses. If the money's going out, it's an expense. But here at Fiscal Fitness, we like to think of your expenses in four distinct ways: fixed, recurring, non-recurring, and whammies (the worst kind of expense, by far). What are these different types of expenses and why do they matter?
There are three major types of expenses we all pay: fixed, variable, and periodic.
Answer: It is better to underestimate you income because it allows you to save more money. If you overestimate your income, you have a higher chance of spending all the money that you earn. Explanation: ... If you over estimate and think you have more than 20, then you spend all the money that you had.
How to Make a Zero-Based Budget
Irregular Income This is the income that we may receive from time to time and can include things such as Bonuses and commission, dividend payments, lottery wins and interest on savings. ... Examples of this type of income could include a company car, free meals, hotel stays, etc.
Mint is great because it gives you an overall picture, while EveryDollar wins for how it puts you in control of your finances.
Most articles and financial experts recommend the “30% rule,” spending 30% of your gross monthly income (before taxes) on your monthly rent. That means, if your income is $4,000 per month (or a $48,000 annual salary), then you should be paying $4,000 x 0.3, or about $1,200, on rent monthly.
EveryDollar: Straight from Dave Ramsey and the folks at Ramsey Solutions, this zero-based budgeting software has free and premium versions. Read my full EveryDollar review.
Yet No Comments