Pay Yourself A Wage Based On Expenses When Making A Variable Income

Pay Yourself A Wage Based On Expenses When Making A Variable Income
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Making a variable amount of money every month can make budgeting unpredictable. To simplify it, finance blogger Kylie Ofiu suggests paying yourself a wage that’s equal to 10 per cent more than your total monthly expenses.

ATM picture from Shutterstock

To make the budget work, you need to calculate the minimum amount you expect to receive every month. From there, you can budget your expenses. Kylie suggests tacking on an extra 10 per cent for personal savings, and then putting anything above that away:

If you know your baseline expenses, pay yourself enough to cover that, plus the 10% into savings I mentioned and sock the rest away. Keep it regular and live as if the rest of the money wasn’t coming in, only the wage you pay yourself.

With this model, you have a pool to pay yourself from in the event that your income ever dips below that minimum amount you need to survive. If your main job has a variable income and can’t always support you, this pool is also a great place to put funds from a second job. Check out the full post below for more ways to live on a variable income.

Budgeting on a variable income [Kylie Ofiu via Rockstar Finance]