Our family as a unit has never truly had completely irregular income. Meaning, although I personally have had irregular income for the past 8 years, my spouse has always had a specific income at regular intervals. So we basically have a regular income with an aspect of irregularity to it. The part that makes me experienced in dealing with irregular income is that we haven’t yet, as a family, gotten to the point that all of our expenses are met by my spouse’s income. That’s the goal – well the goal is that they are all met and more by my spouse’s income – but we have a ways to go for that to happen. My income is pretty diversified now, and we only rely on a small amount of it per month to meet our budget, so it acts more regular than irregular, but that wasn’t always the case.
Even if you don’t think you can create a budget around an irregular income – you already are. You are spending money each month, which means it has to come from somewhere. The goal is to not be like the government and spend money you created out of thin air (sorry, couldn’t resist) but money that you’ve earned in the past. Paycheck to paycheck budgeting isn’t ideal for anyone, but it is basically impossible for those with irregular income. We have to find another way.
A while back I wrote about how to deal with budgeting around an irregular income – the general take home point is that with irregular income, you need to figure out a way to create an artificially regular one. This can be through a savings account you pay yourself out of each month, or specifically earmarking money in your checking account for specific months. For specific ideas about how to create that budget, you can look to that post. The key point I want to drive home today is that to successfully survive, and flourish, on irregular income, you need to expand your thinking about income and what it does. But how? How to escape the idea of spending money when you get money – the idea that so many people have been brainwashed into believing is the only way to exist?
If you still have income coming in, you can start right now. Move it to that savings account. Only take it out as you need it. Resist the temptation to spend more when you have more. Live as close to the bone as possible and spend as little as possible. Hoard. Hoard like you have never hoarded before. Eventually you’ll be ahead and not dependent to meet current bills with income you haven’t earned yet.
If you’re not sure when the next money is coming in, in my opinion I’d start diversifying that income. Find something you can do part time to bring in something. Having diverse sources of income takes the sting away from its irregularity. An additional source of income could be just long enough to get back on track, but long-term diversification is still a good idea.
Whatever you do, the key is to think outside the box. Break free from the traditional thought of spending money as it comes in. Don’t budget your expenses from your projected income. Budget them from your past income. It won’t happen overnight – and you may go more into the hole before you start the upward climb – but keep your eyes focused on the end result. Surviving and thriving in both lean times and abundant ones.