Saving money isn’t easy on a tight budget.
Saving money may be a very important part of your budgeting strategy if your income doesn’t come in a regular paycheque. If you’re self-employed, on contract or get paid commission – you’ve got irregular income. If your income isn’t spread out over even, regular payments and you’ve got debt – you might be struggling to make ends meet.
Irregular income is what we call income that isn’t metered out into regular (usually frequent) payments. Many jobs come with a weekly or bi-weekly payment schedule. However, some of us get paid less frequently. Because of this, saving money is essential to budgeting for a debt-free lifestyle. We can help you stop interest, get back on track and find a way to budget your higher income pay cheques to last longer during lower income periods.
Saving Money Tip 1
Irregular Income Means Irregular Expenses
If your income isn’t steady or “regular”, you might find it difficult to meet the regular schedules your bills follow. The easiest way to ensure that you can meet your expenses is to figure out how much each expense takes up of your annual budget. Be sure to include everything you pay for on a regular basis as well as anything that comes up once a year or less often than monthly. Once you’ve got a total, divide that by 12. The resulting number is your average monthly cost for expenses. Averaging out your expenses across the year will help you avoid late fees and missed bill payments.
Saving Money Tip 2
Cutting Costs May Be Necessary
Once you know how much your expenses are, give your budget a very critical look. Make sure you are comfortable with where your money is currently going and make changes if you need to. For example, downgrading or eliminating cable television, getting rid of a land line, or switching to a new internet provider. Saving money only works if you have money left after paying all of your bills. Reducing expenses can help boost your savings. If you aren’t in a position to increase your income, cutting costs can free up money that otherwise wouldn’t be available to you.
Saving Money Tip 3
Budgeting To Save Is Important
To find out how much (and when) to save, you’re going to have to compare your averaged expenses with your average income. Look up your annual income from last year. You can easily find it on your income tax notice of assessment, final paystub of the year, or on your T4 (if it happens to be tax season). Once you’ve got your total net earnings, divide this number by 12. The result will give you a monthly income that has been averaged across the year. Next, subtract your monthly averaged expenses and see what the difference is. You should now be able to create a budgeting plan to include savings or advance payment on your bills during higher income months.
Seeking Debt Help
The key to a debt free lifestyle is tied to budgeting for all expenses and saving some of your money during higher income months. However, if you have debt, you probably don’t feel like you have any extra money to save. Seeking help will free up money in your budget that can go into savings – instead of paying for all of that interest on your debts. With a consumer proposal or bankruptcy, you can reduce or eliminate your interest and become debt free. Speak with a Spergel Licensed Insolvency Trustee and let us provide you with a FREE in-depth analysis of the options that will clear up your debt, so that you can budget effectively.
We can show you how good it feels to become debt free. You owe it to yourself to give us a call 1-877-501-4321 or book a consultation with us online here.
We are now serving the Greater Vancouver Area. To book with our Licensed Insolvency Trustee Ashvin Sharma, please call 604-365-7434.