Written by 24cashflow » Updated on: February 02nd, 2025
Irregular income is a big concern because that leaves you with less or no financial freedom. In that case, you need to make a financial strategy to be able to manage your expenses well.
Due to the high cost of living these days, it becomes difficult to manage expenses on all fronts. However, still, there are ways, if you follow, you can manage money and live peacefully.
Always track your income over time
Always track your income, as it gives you an idea of how much you are earning. You can take the income of several months into account and track the expenses of the past months.
This gives a clear idea of how smartly you are spending money. Maybe there are expenses which you can avoid. Keep a note of them. While making a budget for the new month, you can avoid them.
The most important thing is to know your income and expenses well. This is why it is necessary to track your earnings. It gives you better control over your life and your finances.
Create a minimum income budget
You can manage your expenses according to your expected earnings. This could be difficult in the beginning, but with regular practice, you will learn to prepare a budget for your lean month. You can also manage your expenses by using discretionary spending or saving. In simple words, you should learn to budget according to your minimum income in these skills. It is possible that you may earn well in some months, but if you earn less in any month, then in such a case, you may face difficulty in managing the expenses in that month. Therefore, it would be better that you plan your expenses by imagining a minimum income through part-time freelance or any other kind of work.
Create an emergency fund
Yes, it is always advisable to create an emergency fund with a small income can be quite difficult. But if you regularly invest a small amount through regular efforts, the emergency fund will fulfil your present and future requirements. It is generally said that if you have an emergency fund from savings equal to three to six months of expenses, then you have better money management skills. Hence, pay as much attention to your emergency fund as possible.
Although this may be difficult with a small income, nowadays, some loan options have also come up for short-term loan requirements. These online loan options are available to people in bad credit situations. A bad credit situation also supports you.
For example, urgent loans for bad credit by direct lender with no credit check is a popular and practical loan product. With its help, you can get funds through online lenders even if you have poor credit. As you repay its affordable instalments on time, your credit rating will improve. This helps you borrow a larger amount at a lower rate if you face any crisis in the future.
Learn to prioritise your needs
To live with a lower income, you have to make many adjustments, so it is better to use your savings income and available loan solutions as per the need. After this, it is important that you learn to prioritise your needs.
First of all, it is important that you learn to differentiate between your wants and needs. Basic expenses will always be more important than your wants. A trip to an amusement park on weekends can spoil your budget. Instead of going on such leisure trips every weekend, you can choose one week in a month. On this day, you can financially spare yourself a little.
Not only this, avoid such services or facilities for some time which are not your basic needs. Instead of using a car wash service, it is better to clean your car yourself in your leisure time. Also, avoid subscribing to countless OTT channels. Subscribe to only one OTT platform at a time or in a month. You understand your lifestyle expenses better, so avoid those expenses you find unnecessary.
Follow the pay-yourself method
Apart from this, it is important that you follow the ‘pay yourself first’ method. Due to the daily expenses, we often forget to save money for ourselves. It is often said that whether you are a business owner or a salaried person, always save some part of your salary for yourself. This way, the money you pay yourself remains safe with you.
You can use this money for household and other needs in time. Sometimes, due to low income, you may not be able to create an emergency fund. But in such a situation, if you have paid yourself, then you can use it for necessary expenses like urgent medical expenses. This always keeps you confident.
By having additional financial support, you can easily manage your expenses. Not only this, it makes your financial situation predictable. At the same time, you can plan your short-term and long-term finances wisely.
Use the envelop method
Budgeting is an important skill which you acquire gradually. Therefore, if you face failure in budgeting, never get stressed about it. The more you are able to manage your income and expenses, the more easily you can manage the cost of living, even with a lower income.
Use the envelope system. In this system, you assign envelopes for every expense. As soon as your income comes in, you put the money in the envelope related to the specific expense.
For example – for groceries, you will put a certain amount in the envelope that reads grocery. This makes it easier to understand for which of your important expenses you need to withdraw money separately. Not only this but through this, you also learn to organise your expenses.
Create flexible budget
It is also important to create a flexible budget. When your income is low, it is not necessary that you earn the same amount every month. Even if you have a specific amount, in that situation also it is important to have a flexible budget. It is possible that your income is fixed but the expenses are not fixed.
Sometimes there are more expenses in some months and sometimes in some months the budget is easily managed. The more flexible you keep your budget, the easier it will be for you.
For example, if you want to buy a car, you need to give a good amount as a deposit. In case of a bad credit rating, the deposit amount can be bigger. However, these days, you have options like car finance for bad credit on guaranteed approval.
By keeping a flexible budget, you can save money according to your current priorities. You can also avoid your other needs for some time. By having a flexible budget, you can manage everything from your future car finance instalment to the budget before taking car finance. You can make decisions.
Review and adjust regularly
Finally, the most important thing comes and that is review: It is necessary to review your budgeting from time to time. Without reviewing, you will not be able to understand your income and expense management. That is why you have to develop the habit of reviewing and during budgeting, some loophole is definitely found.
In such a situation, you can adjust your budget through review. By this, you can avoid any future mistakes and achieve financial peace.
Conclusion
As a conclusion, all the methods given above work easily. However, having less income is a big challenge in itself. It is possible that some months may pass in which you may not be able to manage your essential expenses. That is why the best options in such a situation are two. The first option is that you try to increase your income. Second, try to downsize your basic requirements as well.
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