How to Survive on an Irregular Income

As long as you are running your own business, your monthly earnings will fluctuate. Of course, you enjoy the amount of freedom that comes with working for yourself and being your own boss, but business is filled with ups and downs, and earnings are never certain. You’ll admit to yourself that there are some months when you have it good, and some others…. well, not so good. Having a variable income can undoubtedly create extra challenges when it comes to budgeting. However, proper budgeting is the only thing that can keep you sane. To stay on track with your finances, regardless of what you earn, here’s a look at three tips on how to survive on an irregular income.

Determine your Lowest Monthly Income
This is the first tip on how to survive on an irregular income. You need to figure out the lowest amount of money you could possibly make in a month. Examine your earnings for the last 12 months to find what your lowest income was in a month. After you do this, create a budget based on that lowest income. It will keep you on the safe side, and if you earn higher than that, you can make minor adjustments to your budget as you go.

Prioritize your Spending
The next tip on how to survive on an irregular income is to prioritize your spending. You really can’t have everything you want. That’s why you need to scale your needs, starting from most important to least important. The highest expenses are usually food, transportation, and rent, and these are essential for your survival. After putting aside money for the most important needs, you can focus on spending on other items that are lower on your list. I suggest that you read my last article on how to stop overspending.

Live Below Your Means
This is the last tip on how to survive on an irregular income but definitely not the least! This doesn’t mean you have to live poorly. It simply means you should not spend more than you earn. Also, try to resist overspending in the months when you make a high income. Being prudent with your money will help you avoid unnecessary debts, save more, and stay afloat even when things aren’t rosy.

Finally, you should know that financial discipline is everything. If you have zero control over your spending, you’d always be in a financial mess, and it wouldn’t matter if you are on a regular salary or not. Sticking to a budget may not be easy, but it will give you some peace of mind, so give it a try.

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