Lesson 3 of 3 · 2 minute read
When your pay changes week to week
Budgeting tips for gig work, tips, or hourly shifts that go up and down.
If you drive for an app, work for tips, or get different hours each week, your pay can go up and down a lot. That makes budgeting harder, but not impossible.
Plan around a low month
Look at what you earned over the last few months. Find the lowest month. Build your BudgetA plan for where your money will go, so you know what you can spend before you spend it.More in the glossary around that number, not your average or your best month.
If you plan on a low month, most months you’ll have extra. That’s much easier than planning on a good month and coming up short.
Use a buffer for the ups and downs
In a good month, put the extra into savings. Think of it as a buffer: money that fills the gap when a slow month comes. Over time, a buffer can let you pay yourself about the same amount every month, even when your pay changes.
Keep the buffer in a separate account so it’s not easy to spend.
Working for yourself? Save for taxes
If you’re paid as an independent contractor, taxes usually aren’t taken out of your pay. You may owe them when you file. Setting aside part of every payment can keep a big tax bill from surprising you.
When money is short, pay first things first
If you can’t pay everything this month, pay these first:
- Housing
- Utilities
- Food
- Getting to work, like gas, car insurance, or bus fare
Then call the companies you can’t pay right now. Ask for more time or a payment plan. It often helps to call before the due date.
Need help now? Call or text 2-1-1 to find local programs that help with rent, utilities, and food.
If your pay goes up and down, plan your BudgetA plan for where your money will go, so you know what you can spend before you spend it.More in the glossary around your lowest month. Then most months, you will have extra.
In a good month, save the extra. This buffer fills the gap in a slow month. Keep it in a separate account.
Work for yourself? Taxes may not come out of your pay. Set aside part of each payment for taxes.
When money is short, pay for housing, utilities, food, and getting to work first. Then call the others and ask for more time.
Need help now? Call or text 2-1-1 to find local help with rent, utilities, and food.