How Do I Budget With A Variable Income?

Everywhere you turn, you hear having a budget is the first piece of the financial stability puzzle. But how do you create a budget when your income varies month to month?

If you’re self-employed or only earn commission, you know one month you can make it rain, and the next, you’re in a drought.

But fear not variable income earners — budgeting is possible with the right strategy. By following the steps below, you’ll be well on your way to shoring up your financial house.

Preparing a Budget on Variable Income

Successful use of a budget gets your money working for you so you can attain your financial goals. It will take some time to reach your goals, but you’ll get there much faster with a sound strategy.

You can use a pencil and notebook, a spreadsheet, or an app like Tiller Money to build a budget — just use something you’re comfortable with.

Set Your Foundation

Even though your income may fluctuate wildly from month to month, your expenses should remain relatively stable. Review the last few months worth of spending and determine how much your absolute essentials cost you.

In this tally, you should include expenses like housing, utilities, groceries, medicine…