How to Manage My Expenses on Uneven Income?

Is your income from your business, real estate, sales commissions, bonuses, or investments?  The reality is that rental vacancy rates,  the economy, the sales cycle, or what's happening in your industry can influence the timing of your income.

The keys to thriving – instead of just surviving – are planning and organization:

• Track income and expenses regularly – what are your “must pay” expenses every month and what can you cut back on if necessary if your income is lower? Use an app, a spreadsheet, or a simple notebook.
• Use a cash flow-based budgeting system – set up your own in Excel or try out the template below. If you're a client, ask me for a copy of my detailed worksheet.  
• Diversify your income - Explore your side hustle options, including digital business ideas, part-time work, gig work, and income-producing investments. Aim for enough regular extra income to cover an essential bill, such as your mortgage, insurance, rent, car, or student loans.
• Build your cash reserves -  An ample cash cushion will help you navigate when you are not paid by a client or customer on time, you have unexpected expenses, or when extra income isn’t available or practical. 
• Have a Planned Spending account – Add up all your irregular, predicted expenses for the year – such as vacations, gifts, insurance, property taxes, and other expenses that are paid annually or irregularly -- and divide the amount by 12. Save that much in your Planned Spending account every month.
• Organize the due dates for your monthly bills – Contact utility companies and your creditors to see if you can change your due dates for bills to correspond with when you’re typically paid.
• Pay your taxes all year – Use the IRS Withholding Calculator to figure out the correct number of withholding allowances to claim for your main income and any side hustle. For independent contractors, small business owners, and gig workers, consider using an app such as QuickBooks Self-Employed to give you clarity on what you have earned and what you owe.

If you’re looking for an experienced and dedicated real estate financial planner and want to see if Real Life Planning is the right fit for you, we’d love to have you book a discovery call with our team.

🏠 If you have a topic you'd like us to tackle on The Real Life Blog, we would love to hear from you! Please email us at info@realifeplanning.com.

This blog is for general financial education purposes. Information contained in this blog should not be construed as financial, tax, real estate, legal, or investment advice. For educational purposes, blog posts may contain links to other websites which are not under the control or and are not maintained by Real Life Planning. Real Life Planning has provided those links for your convenience but does not necessarily endorse all the material on those sites. Please consult your financial, real estate, legal, or tax advisor for advice specific to your situation.