How do you develop a budget if your income keeps changing? Companies are using more contract workers these days and that often means irregular hours and pay. Budgeting on a variable income isn’t hard if you know a few tricks.
Developing a budget isn’t difficult if you know how much money you have to spend. But what if your income keeps changing? Then what do you do? Companies are using more contract workers these days and that often means irregular hours and pay. Budgeting on a variable income isn’t hard if you know a few tricks.
Spending less than you earn is the key to every financial success. It’s nearly impossible to stay out of debt and save without a spending plan. Proverbs 27:23 reads, “Know well the condition of your flocks, and give attention to your herds.”
Begin by tracking your expenses for 30 days. Capture every expense no matter how small. Think about the non-recurring expenses. Next, add these in with a monthly amount needed to have what’s necessary when that expense rolls around.
Then, take that 30 days of actual spending plus the non-recurring expenses and build a budget by category. The MoneyWise app will make quick work of that for you.
Bring your budget in line with your income and making sure that your spending reflects your goals and priorities.
You’ll also have to decide who manages the budget going forward. Sometimes the more detailed and organized person to do this is the wife, sometimes it’s the husband.
Here’s what you do about variable income. Determine your average monthly income for the last six months. Ask, “Can I reasonably expect to earn the same amount in the next six months?” The goal is to arrive at a budget that can be covered by the average or slightly below average amount you expect to earn each month.
On this program, Rob also answers the following listener questions:
Is it wise for a church to invest in mutual funds or even real estate?
Would it be wise to invest in a duplex?
How can you close credit card accounts with minimal impact to your credit score?
When you get married, are you liable for debt accrued prior to marriage in the other person’s name only?
Remember, you can call in to ask your questions 24/7 at (800) 525-7000 or email them to Questions@MoneyWise.org. Also, visit our website at MoneyWise.org where you can listen to past programs, connect with a MoneyWise Coach, join the MoneyWise Community, and download free, helpful resources like the MoneyWise app. Like and Follow us on Facebook at MoneyWise Media for the very latest discussion! And remember that it’s your prayerful and financial support that keeps MoneyWise on the air. Help us continue this outreach by clicking the Donate tab on our website or in our app.
