How to Manage an Irregular Income

Earning an irregular income means your pay changes from month to month. You might be a freelancer, work on a zero-hours contract, or run your own business. When your money goes up and down, it can feel overwhelming. Let’s skip the complicated advice and look at three simple steps to stay in control. Once you master these basics, you can try advanced budgeting ideas that will help you even more in the future.

Know Your “Must-Pay” Number

Forget confusing budgets. Just figure out the absolute bare minimum you need to pay for your rent, food, and bills each month. That is your Must-Pay Number. As long as you cover that number first, you are safe. Anything additional to this number isn’t urgent.

Store the Extra Money

When you have a really good month and make more than your Must-Pay Number, don’t spend the extra money right away. Put it to one side in a separate savings pot. Think of it as your backup money.

Use the Backup Money for Quiet Months

When a slow month hits and you don’t earn enough to cover your Must-Pay Number, don’t panic. Simply dip into your backup money pot and pull out exactly what you need to bridge the gap. Knowing you have this extra buffer will also relieve a lot of stress when you’re worried about making ends meet.

Why Millions of UK Workers Face the Same Struggle

If you find this hard, you are definitely not the only one. Data shows that 48% of families have less than £1,500 in savings, and 20% have no savings at all. It is incredibly tough to build a safety net when your income fluctuates, so don’t be too hard on yourself if you’re finding it tricky. The only way to break the cycle is to try something new, and the more you persist, the closer you’ll get to a steadier, more secure financial future.

Looking For Help

Sometimes, a quiet month hits at the exact same time as an unexpected emergency, like a broken phone or a car issue, and your backup money pot isn’t quite ready yet. This can be very overwhelming as many people don’t know where to turn too. Some people are able to turn to friends or family, but others may not have that option. 

If you ever find yourself stuck in a tight spot with no where to go, you may start to look at borrowing a payday loan to get through to your next busy month. If this is the case, BingoLoans can help. We offer simple short term loans to bridge the gap and keep things moving forward. For more information, click here.