Hitting your money goals can be hard when you have irregular income. If you're a freelancer, contractor, or small business owner, having a system in place is paramount. Here's a system that will help you achieve your goals using a bucket approach.
The first step is to set up financial "buckets." These are separate accounts or categories where you funnel your money. Examples:
Here's the key: because you have irregular income, you need to set up your buckets with percentages instead of dollar amounts.
Example: You want to save 10% for retirement.
No matter how your income fluctuates, you're still working towards your goals at a consistent pace.
Every time you receive income, funnel it into your buckets according to your plan. This only takes 5 mins or less!
Adjust over time! Your goals and priorities change, and so should your buckets.
After you do this payday routine a few times and build the habit, it'll become effortless. You'll have saved up a surprising amount of cash before you realize!
For a deeper guide on budgeting with irregular income, including why percentages beat dollar amounts and what to do the moment income hits your account, see How to budget with irregular income.
To make things even quicker, I made Wealthsplitter. It's super easy to use: Just tell it whenever you earn income, and it'll calculate exactly how much to allocate per goal. You can make a simple system, or a complicated one that cascades through multiple bucket levels.