How I Budget With a Variable Income

Freelancing is great, but there are some things I miss about full-time employment: Free coffee Mingling with coworkers Cheaper health insurance And a steady paycheck. For the most part, my income doesn't vary too much from month to month, but it does vary. Even though...

read more

How to Stay in Vacation Mode Once It’s Over

In one of my favorite episodes of Frasier, Niles is so reinvigorated after a trip to Belize that he develops a persona when he returns to day-to-day life: Island Niles. Unlike day-to-day Niles, "Island Niles" is carefree, non-judgemental, and relaxed. He wears board...

read more

Let’s Bust Some Freelancing Writing Myths

There’s a reason freelance writers rarely introduce themselves as such when asked, “what do you do?” It usually shuts down the conversation. People have their own assumptions about what it means to be a freelancer and those assumptions are rarely positive. As my...

read more

My Favorite Things to Do in Copenhagen

I thought a cocktail in Los Angeles was expensive -- and then I went to Scandinavia. Scandinavian countries like Norway, Sweden, and Denmark are notoriously expensive, mostly due to their taxes (seriously, the VAT was 25%), but I was still unprepared for just how...

read more

Here’s What People Buy When They Spend Impulsively

Work is crazy, your schedule is crazy, and you feel like you're going crazy. You attempt to buy your way to calmness, so you hit up your favorite store or you hit the BUY NOW button online. Somehow, you feel a sense of satisfaction. Relief, even. We've all been there....

read more

A Quick Tip for Waking Up Early to Write

It’s hard to make time for your own stuff. You likely have other priorities that take up most of your day, like work. Work always gets in the way, doesn’t it? But alas, you have bills to pay, mouths to feed, and money to make. I used to run into this problem when I...

read more

kristinwong

Hey! I’m Kristin. a freelance writer and journalist (you can find my stuff at Lifehacker, NY mag, the NY Times, and more). Here, I share what I learn about how to freelance, from managing money to digital nomading to figuring out why the Wi-Fi isn’t working. 

What You're Saying

  • Lauren: I found myself on a very similar position as...
  • sagar nandwani: I’ve been in vacation mode for...
  • Kevin: I used to sit at my desk at and read news...
  • James brandon: They recently reopend spending...
  • Vivian: Every time I schedule an activity I almost...

How I Budget With a Variable Income

how to budget variable income1Freelancing is great, but there are some things I miss about full-time employment:

  • Free coffee
  • Mingling with coworkers
  • Cheaper health insurance

And a steady paycheck. For the most part, my income doesn’t vary too much from month to month, but it does vary. Even though I have the luxury of steady work, there are still certain factors that can make my monthly income difficult to predict, like how long it takes a client to pay. Here’s how I’ve learned to budget with a variable income over the years.

I Budget for Famine, Not Feast

My hairstylist once described her freelance business as “feast or famine.” You can feast like a king one month, and then find yourself eating Ramen every day the next. You don’t want to budget based on “feast” months because, during those months of famine, you won’t have enough to pay the bills.

Instead, I budget for famine, meaning I budget according to my lowest paid month from the past 6 months. I use that amount to come up with a spending plan using zero-sum budgeting. With a zero-sum budget, you list all of your basic living expenses, budget for them,  then put the excess to work, giving every dollar a specific job, whether it’s paying off debt, saving for retirement, or some other goal.

My famine budget errs on the side of caution, but if your income doesn’t vary too much and has been fairly steady for the past year, you might just consider using your average income from the past twelve months. This way, you’re sort of getting the best of both worlds. When your salary is higher than average, you can save the leftover amount. When your salary is lower than average, you can use that leftover money to pay yourself more.  read more…

kristinwong

Hey! I’m Kristin. a freelance writer and journalist (you can find my stuff at Lifehacker, NY mag, the NY Times, and more). Here, I share what I learn about how to freelance, from managing money to digital nomading to figuring out why the Wi-Fi isn’t working. 

What You're Saying

  • Lauren: I found myself on a very similar position as...
  • sagar nandwani: I’ve been in vacation mode for...
  • Kevin: I used to sit at my desk at and read news...
  • James brandon: They recently reopend spending...
  • Vivian: Every time I schedule an activity I almost...

How I Budget With a Variable Income

Freelancing is great, but there are some things I miss about full-time employment: Free coffee Mingling with coworkers Cheaper health insurance And a steady paycheck. For the most part, my income doesn't vary too much from month to month, but it does vary. Even though...

read more

How to Stay in Vacation Mode Once It’s Over

In one of my favorite episodes of Frasier, Niles is so reinvigorated after a trip to Belize that he develops a persona when he returns to day-to-day life: Island Niles. Unlike day-to-day Niles, "Island Niles" is carefree, non-judgemental, and relaxed. He wears board...

read more

Let’s Bust Some Freelancing Writing Myths

There’s a reason freelance writers rarely introduce themselves as such when asked, “what do you do?” It usually shuts down the conversation. People have their own assumptions about what it means to be a freelancer and those assumptions are rarely positive. As my...

read more

My Favorite Things to Do in Copenhagen

I thought a cocktail in Los Angeles was expensive -- and then I went to Scandinavia. Scandinavian countries like Norway, Sweden, and Denmark are notoriously expensive, mostly due to their taxes (seriously, the VAT was 25%), but I was still unprepared for just how...

read more

Here’s What People Buy When They Spend Impulsively

Work is crazy, your schedule is crazy, and you feel like you're going crazy. You attempt to buy your way to calmness, so you hit up your favorite store or you hit the BUY NOW button online. Somehow, you feel a sense of satisfaction. Relief, even. We've all been there....

read more

A Quick Tip for Waking Up Early to Write

It’s hard to make time for your own stuff. You likely have other priorities that take up most of your day, like work. Work always gets in the way, doesn’t it? But alas, you have bills to pay, mouths to feed, and money to make. I used to run into this problem when I...

read more