Remember the last time you were on a roller coaster? Some of the older coasters would start slow with the rise to the top of the first drop. As you speed down that first descent, the wind pushes your cheeks back and the drop leaves parts of your stomach trying to catch up with the rest of your body. This roller coaster will often slow down during another incline that allows your stomach to catch up just in time for another drop that will raise that adrenaline right back up. Some roller coasters even have a slight plateau or pause in the middle of the ride, only to again lead into a drop that will push those cheeks to the back of your face again. Some of today’s coasters will launch you from a dead stop. Never mind the slow rise to the top.
Many people live life with an irregular income that can often feel like one of these roller coaster rides. Whether we are in sales, work on commission, or we’ve entered the entrepreneurial life to run our own business, sometimes that paycheck will seem like a roller coaster ride.
How do we manage a budget while speeding through life on a roller coaster? This is often a challenge for many reasons. Not only is our income irregular but when it finally “comes in '' it can be on a different date each month. One payment that arrived on the fifth of last month may arrive on the twentieth of next month. And depending on your craft, the amount can also be its own roller coaster.
Many of us adrenaline junkies will climb back on that roller coaster for another ride. We can start to get familiar with the slower inclines and the sudden speed drops of the rides. We even get familiar with a number of other aspects of the ride. We know when to get on, how to strap in, where to put our belongings so they don’t fly out. Most of all, we know where the camera is for that fun snapshot.
In the same way, the best way to manage a budget on an irregular income is to recognize what you know and remember about the ride. Specific expenses have due dates, such as your mortgage/rent, utilities, cell phone, and any minimum payments you have. Your groceries and gas can be averaged from past months to get an idea of what those expenses look like per month. From here you will have a baseline of what you will need each month, a target so to speak.
For example, if these fixed expenses total $3000, you know that $3000 is your target goal. This can bring relief to your nerves because now you can focus on a lower amount of income that will cover your needs. This does come with a price. Your wants have to take a back seat to your needs. Things such as eating out, gym memberships, subscriptions like Netflix, Hulu, or Amazon are secondary to your needs.
Focusing your budget in this way will give you more control and stability on the roller coaster income ride that you are on. You will have a defining number to focus on. First, your baseline needs, second a number for your desired wants, and this final number is the overflow.
