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How to Budget on an Irregular Income


Budgeting on Irregular income

Is there a system to help you budget when you never know when you’re going to be paid?

Yes, there is! Read on and learn how to make a budget when you have an irregular income.

Financial stability is possible even with unstable income. You just have to create a financial buffer and a responsive budget to get through dry spells using the tips below:

List all your necessary expenses for the year.

First, it helps to figure out what expenses are necessary.  There’s no clear-cut rule as to what is necessary and unnecessary. It depends on what you think is unnecessary after thinking about the consequences of buying it. It’s because what you consider trash could actually be somebody else’s treasure.

So, the rule is, define necessary expenses. That includes food, utilities, medical expenses and things you need to earn a living. Make sure that your definition includes the words, “practical” and “budget-friendly”.  Another useful tip is to determine whether it is an item you can do without in addition looking for other ways to reduce the cost in other necessary areas like utilities and transportation.

Say you love shopping for shoes and clothes, sometimes just for the heck of it. If you think you can cut back and buy only a fraction of what you bought before, then those other things you chose to let go are unnecessary purchases.

Compute your average monthly expenses

Add up all the necessary expenditures and divide the sum into 12 months to know how much you need each month. Write them down on a piece of paper, and get the overall cost as small as possible. Where possible you can reduce certain discretionary expenses to add a little more for emergency expenses, things like transportation or entertainment. This will ensure you don’t ruin your budget when minor money emergencies come up.

Refer to your financial statements such as utility bills, accounts and mortgage statements, to see exactly where you are spending your money.  Don’t limit the list of your monthly expenses to utilities, mortgage or rent, insurance and car payment and other recurring expenses. Include those with variable amounts such as the following:

  • groceries
  • clothes
  • beauty/hygiene costs
  • transportation (gas/fare)
  • Medical insurance. If you’re on a tight budget you might think that medical premiums are added burdens. But, getting sick while uninsured could put you in financial strife, so at the very least getting basic hospital and extras cover could mean the difference between financial stability or ruin.

Making a list of both your fixed and variable expenses could help you to make small to large adjustments in an effort to reduce your budget. A good example is when you move to a cheaper apartment or one that’s closer to your workplace. In either of these examples you can save money either on rent or transport.

Create a financial buffer

Save money when you’re doing well so you will have enough money to fund the gap when you don’t have one. This will give you the security of having regular income between your ups and downs. The trick is to create three-months’ worth of your monthly budget to mitigate cash delays.

Here are little adjustments you can make to start saving money:

  1. Save at least 15% of your income each month
  2. Track your expenses and choose something to trim down such as-
  3. Fancy dinners at restaurants. Eating out with friends at least once a month may do no harm to your budget, its when you are more frequent that you could look at hosting dinner parties at your home rather than going out.
  4. Product/service subscriptions. Unsubscribe from monthly services you don’t use. Do you pay for an expensive gym membership, but you don’t have time to go there? Why not chuck on your yoga pants out and sweat it out in the comfort of your own home. There are many fitness exercises apps you can use for free. Book lovers can also trade book subscriptions for kindle and other free reading apps.

Get side gigs

If you think your income won’t be enough to build a financial buffer, you could look at ways to generate income from your passions, skills or trade. Having side hustles to boost your savings is a great way to keeping you on track and meeting your financial commitments.


When you’re receiving an irregular income, it is important to acknowledge that there will be rough patches along the way. Don’t spend everything when money is overflowing. Instead, prepare for the rainy days so you can still enjoy financial security when your cash flow dips for a while.


Simone xoxo