Tips For Budgeting With A Constantly-Changing Monthly Income
The year is 2012 and you’re dreaming of a full time career on YouTube: The freedom, the creativity, the impact you can have, and most of all, the absolute joy of budgeting with an income that’s different every single m— oh, wait, that wasn’t part of it?
Perhaps it’s not true of 100% of full-time creators, but let’s take a wild guess and say 99% of you do not enjoy your monthly sit-down to take a look at your finances (if you even have one). Even after you’ve started to make enough money to live off of your fun new career, figuring out how much you have and what to do with it can feel overwhelming, if not pointless, when the number is different every single month. The freedom is amazing, but the inconsistency might be the hardest part of the job.
Alas, any successful business has a great record of it’s cash flow and an organized plan for how to handle it, and influencer businesses are no different.
So, while budgeting tips are not one-size-fits-all, here are a few things we recommend trying out if you’re feeling chaos in the budgeting department:
(disclaimer: we are not financial experts, please discuss with a financial advisor)
The Budgeting App, Monarch: Monarch has great tools specifically for those with an inconsistent monthly income. You can divide up your predicted monthly income between businesses and set your predicted income for the current month and for upcoming months. It has a web browser version and a phone version, both with nice, clean user interface. You can collaborate with others or keep your account private.
Start with your expenses and then set goals: The typical way to budget is to start with your income and then figure out what to spend it on. When you’re unsure what your income will be, it can help to switch to a goal-mindset. Start with how much money you need for the month, then set goals for what you want to save, spend, invest, or give beyond that. Throughout the month, rather than checking how much money you have left, focus on how many more jobs you want to book.
Budget based off of one fairly consistent source of income and consider the rest a bonus. If you do have one source of income that tends to be consistent (Twitch or Patreon supporters, YouTube ads, etc), try setting yourself up to earn enough from there that it can act as your base salary. Consider brand partnerships or other one-time sources of income a bonus that goes toward your savings goals or wiggle room. If you don’t have a good sources of semi-passive income yet that can be consistent over time, consider starting one — this can be a huge help.
Budget based on the month prior. It is hard to find a budgeting app that is set up well for this, but if you can keep yourself organized, you can plan your expenses around what you made the month prior. The percentage system is commonly loved — 50% for essentials, 20% for savings, 30% for everything else; or 10% to charity, 10% to savings, 80% for expenses.
Quickbooks Self Employed: This is great for bookkeeping come time for taxes. You can divide up your income between business and personal and then export it all to Turbo Tax within a couple of seconds. It’s not as well designed for daily budgeting but super helpful at the end of the year.