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Budgeting for gig workers: How to spend and save on a fluctuating income

Building, maintaining, and sticking to a budget can be a tough task for many of us with regular, full-time jobs. But it gets a lot more difficult if you don’t have a regular income, like those in sales-based jobs, seasonal workers, or folks who work in the gig economy. If you fall into one of these categories — as more and more young earners do — it’s especially important to budget wisely to have a plan for those months when the checks don’t come in quite as high as usual.

The average and the extremes

The first step to building your budget is to look back and figure out your average income for a month. This can be challenging if you’re new to working without a set wage, but try estimating on the low end, and you can adjust it later. 

From there, I like to find your low-end and high-end extremes for good and bad months. A bad month could mean low sales, an unpaid vacation — anything that keeps you from meeting your average. A good month could mean a particularly large commission or some extra work coming in.

Let’s use these figures as an example:

Average: $5,000
Low end: $3,000
High end: $7,000

You will build your budget based on the low-end income, starting with your monthly bills like rent, mortgage, car payment, etc., and going from there. 

Emergency funds

Next, we’ll build up two emergency funds — the standard Emergency Fund, which should be three months of your average income, and what I’ll call an Excess Emergency Fund, which is three months of the difference between your average income and low-end income. 

Emergency Fund: $5,000 x 3 months = $15,000

Excess Emergency Fund: ($5,000 – $3,000) x 3 months = $6,000

You’ll dip into the Excess Emergency Fund during those low months when you need some extra cash and save the standard Emergency Fund for unexpected bills or the loss of a job. You have to be very disciplined — when you have a good month, you should build back any funds that you’ve pulled from. 


For people with irregular income, depositing into a retirement account can feel risky — what if you need that money in the short term? That’s a valid concern, but it’s still incredibly important to start growing your retirement today. The easiest thing to do in this situation is to figure out what percentage of your income you want to save for retirement — 15%, for example — and stock it away in another savings account. Then at the end of the year, you can make one big lump-sum payment into your retirement accounts, subject to limits and qualifications, when you know you’ve safely navigated the year. That way you remain liquid for as long as possible while still maxing out your contributions and letting that money grow.

Let Family Financial Partners help

There are plenty of other considerations, including setting aside money for untaxed checks, investing, paying down debts, and more. I would love to sit down with you and help build a plan for what your individual ratios should look like between spending and savings and help you organize all these different accounts. Feel free to contact me or anyone else on our team today for a free consultation, and we’ll help get you on your way toward building the perfect budget for you.

Article by Kyrk Davis, Wealth Advisor at Family Financial Partners — a financial services firm in Lexington, Kentucky.

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