Running your own business gives you freedom, but it also means your income can be unpredictable. One month, you could land a big job; the next might be completely quiet. Without a regular paycheck, budgeting isn’t just helpful—it’s something you need to stay afloat. If you’re unsure how to manage your money when it’s not coming in steadily, this guide will walk you through how to handle it without stress.
Figure Out the Basics You Need to Cover Monthly
The first thing to do is work out how much money you need each month just to get by. That means rent or mortgage, food, bills, transport, insurance, and your business essentials. Add all of that together so that you will know the amount you need to keep everything running. Using budget tools like Pocketbook or You Need a Budget can help you keep track of what you’re spending and where your money’s going.
Build a Safety Net for the Quiet Months
Because your income isn’t steady, it helps to build a buffer, which is the money you put aside. Try to save enough to cover at least three months’ worth of expenses, and the best time to save is when you’ve had a payday. Try putting 30% of that into a separate savings account so that you’re not tempted to touch it. Chime lets you set automatic transfers, so you’re building that buffer without thinking about it too much.
Set Yourself a Regular “Payday”
Instead of spending whatever lands in your account, pay yourself a fixed amount each month, just like a salary. Transfer the same amount from your business account to your account once or twice a month. This helps create stability and makes it easier to plan. You can use software like Xero or Wave to track your income and business expenses so that you’ll know exactly what you can afford to take home.
Base Your Budget on a Low-Income Month
It’s easy to get caught up when a great month happens and start spending more, but when you build your budget, don’t use your best month as a reference. Instead, look back over the past 6 to 12 months, figure out your average income, and then set your budget based on your lowest month. And if you end up earning more? Then that’s great because you can save, invest, or pay off debt with the extra cash.
Automate the Essentials, Delay the Extras
When your cash flow is unpredictable, set up automatic payments for things like savings and regular bills. At the same time, hold off on spending for things that aren’t urgent, like new software that is not needed, so that during quiet periods, you’re not draining your bank account. You can use Rocket Money to find and cancel subscriptions you’re not using or to delay spending on things that can wait.
Don’t Forget to Save for Taxes
No one’s taking tax out of your payments when you’re self-employed; it’s on you to handle it. That means setting aside your money regularly so you’re not hit with a big surprise later. Always remember that a good rule of thumb is to save about 25–30% from every tax payment. Aside from that, it is smart to open another separate bank account just for tax savings so you don’t mix it with other money.
Check In With Your Budget Monthly
Your budget isn’t a set-and-forget kind of thing, so it is important to check it each month and see how your actual income and spending compare to your plan. Make a habit of noting which clients paid you, what you spent on business and life, and whether you’re sticking to your plan. This way, it helps you spot patterns, like which months tend to be slow, and make better choices moving forward.
Budgeting Lets You Breathe Easier
When your income isn’t regular, having a plan in place makes all the difference. Budgeting is about making sure you can handle the slow months. Knowing your costs and paying yourself regularly helps create a steady rhythm, even when your income jumps around. While it may take a bit of effort upfront, treating your money with the same care as your business gives you more freedom in the long run.
