undefined undefined Budgeting on an Irregular Income
2007
Budgeting on an Irregular Income
March 2007

“Budgeting on an Irregular Income,” Ensign, Mar. 2007, 72

Budgeting on an Irregular Income

One of the hardest things my husband and I have encountered while being self-employed is maintaining a budget. With a fluctuating income, it can be a challenge to plan for expenses. For us, the key to successful budgeting is creating a “steady income.” We do that by depositing all net income into one account and paying ourselves a monthly household salary, a median of the highs and lows. In other words, even when the previous month’s income was high, we maintain an average income, thus leaving enough to cover the low-income months as well. To successfully track our spending, we have established a detailed spending plan that includes all our fixed and periodic expenses. We also maintain a careful savings plan. The saying “don’t count your chickens before they’re hatched” is especially relevant when you are self-employed. You cannot spend what you make month to month. You have to look at the overall picture and set a budget plan within fixed parameters.
Katie Stone, Utah

Illustration by Joe Flores