How to budget on a variable and irregular income: Part 2

Last week, I looked at creating a budget on a variable and irregular income. If you missed it, go here and catch up. I’ll wait! 

Now that we’re on the same page, let’s continue with more tips for managing a variable and irregular income:

 

• Start tracking your cashflow. In detail. I have a spreadsheet which tracks daily income and expenses for the entire fiscal year.
• Plot your future expenses into the cashflow tool. Put in your regular bills (eg utilities and loan payments) along with once-a-year bills so they won’t surprise you later!
• Plot all income into your cashflow tool. Remember to calculate and pay tithes or taxes that may be due. I do this for each payment as received, otherwise I forget. Our tithes go directly to our church, while our taxes go into our savings account until the quarterly payment date.
• In the early days, you need to regularly monitor your cashflow against your budget. I reconcile my bank accounts weekly against my predicted cashflow.
• Review your cashflow. Are you exceeding any of your budgeted expense categories? If so, why? Can you cut back, or do you need to revise the budget?
• Once you are comfortable with the size of your emergency fund (Dave Ramsey recommends a baby fund for starters, but for our situation, the bigger the better in my opinion), start working out a debt-reduction strategy and a long-term savings/investment strategy. Again, Dave Ramsey is the expert, although Crown is another excellent resource specifically for Christians.

Hopefully, by now you are on your way to having control over your cashflow and your budget. Please let me know how you are doing!