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Making It in San Diego: How to budget when you're on an inconsistent income

Posted: 7:27 AM, Oct 03, 2018
Updated: 2018-10-04 00:47:26Z

Earning money is one thing, but budgeting your monthly expenses can be tough -- especially for people with a fluctuating income.

Many workers fall into that category in cities that thrive on entertainment, dining, and different types of service industries.

"The first thing to do is get some income tracking going.Take a week, two weeks, four weeks, depending on how often you're paid, and you'll see what your base income is," said financial expert Steve Budin.

That means how much you earn on average. Budin says whatever number you come up with should be your bare-bones budget. 

The next step is to know your fixed living expenses. These include things like groceries, rent, mortgage, phone bill, insurance payments. Compare the total of all that to your income and whatever is left should be put in separate savings accounts, starting with a rainy day account to cover unexpected expenses. 

"A good rainy day account would be something you don't have a credit card attached to. Something that's difficult to access. It's really not for day-to-day purposes," says Budin.

And then, if you still have extra money, put that in a bonus account which you can use for dining out, travel and other lifestyle choices.

"Once you see some success and you see some of that extra money accumulate, then it really becomes a nice mind game because as you see those numbers grow, it'll keep you incentivized to keep doing it."