How do you budget when you have irregular income?

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A friend wrote me this email wondering how I budget on an irregular income. I have some suggestions, but before I write them up on here, I wanted to throw the question out and see what people think. How do you budget for irregular income (e.g., if you’re a student, consultant, etc)?

How do you budget when you have a highly variable and semi- unpredictable income over time, due to significant amounts of contracting, short-term (summer) gigs, etc.?

My stipend is $x/month, but I not-infrequently make 1.5x, 2x, or 3x, often just for a week or a month, or for the summer, and even my stipend varies (by 50%) from year to year due to different combinations of support/fellowships. In short, I make “enough” money, but how/where/when is totally up in the air.

I get by without trying primarily because I’m frugal and focussed in my spending, and all my income goes directly into savings from which I mostly deduct fixed amounts monthly…

But it’s at best semi-planned and I still don’t always feel in control, particularly under extended periods of heavy deadlines and such when my ability to manage my life goes out the window, I totally lose touch with Quicken, and my spending even seems to increase due to much larger amounts of restaurant food (OMG NO TIME FOR GROCERIES!!1!).

The core problem is this: though my net savings cashflow is almost universally positive, I still pay major/one-time expenses directly out of savings (since that’s where all money goes aside from monthly rent, DRIP deposits, etc. that gets auto-deducted). In short, I’m half-way organized and the other half is just riding on the fact that I’m *generally* frugal and “relatively* well-off.

This is hard with such variable income since my innate pattern- matching skills no longer apply (“my savings is only up $2000 this month, something must be off or I must have spent too much” makes no sense when my savings should go up anywhere from $1000 to $7000, mid- month or any other time, depending which way the wind blew last Tuesday).

What do you suggest for budgeting on an irregular income?

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42 Comments

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  1. My wife and I have a minimal amount that we know we are going to make. She makes at least $400 a week and I make at least $600 every other week. We budget on the minimal amount and either apply the extra to our savings or to paying off a particular loan. If we know one week will be lower than those amounts we will either pull the difference from our savings.

  2. I can relate with you. I’m also a graduate student with a varied income.

    Bottom line: If frugal, which you say you are, I recommend budgeting based off of the lower-end of your payscale. For example, if you make anywhere from 2000-6000 a month, budget based off of 2000. (or maybe higher than that if you need to). Doing this would allow you to add major cash to your savings, potentially.

    You should feel proud. Not many students can say they have a positive cash flow! Good luck to you!

    Kind Regards,
    Jonathan Cisco

    http://www.dreamingnz.com

  3. I have two suggestions:

    -Use your high-interest account to buffer your income over time; use your money-losing-after-inflation traditional bank account to spend out of. E.g. have everything deposit into Emigrant/ING/HSBC/whatever, and have a scheduled transfer from the high interest account to your traditional bank account. That way you can see each month whether you have more or less *in that account*, which will give you an idea of your actual consumption.

    -Learn to love Quicken’s cash flow features. If you carefully exclude accounts/categories, you can make them actually reflect what’s going on. In particular, you want to be watching the outflows, obviously, to make sure they’re constant (instead of benchmarking against how much your savings went up this month).

    Ari

  4. No matter how much money you make, your budget should be how much you need to maintain yourself, the people who depend on you, and your livelihood.

    1. Assess what you spend money on.
    2. Budget according to what you need to live and work (food, insurance, rent, debt payments, paying yourself first, etc).
    3. Maintain a buffer long enough to pay for #2 for 3-6 months.
    4. Prioritize your other expenses (toys, vacation, education, etc).
    5. When you have money beyond this buffer, plan how you will spend it according to your priorities.
    6. Spend your money according to plan!

    Again – it doesn’t matter how much money you MAKE, it matters how much you NEED.

  5. Heh. Haven’t got as far as planning yet, but since me too I always seem to acquire “enough”, I intend to take an average of the acquired and spent money over the previous 3 or so months and imagine that would be what I would get.
    Really interrested in this one, since it’s really my situation as well (maby not that impressive differences from month to month, but still not stedy).

  6. My wife and I started using Budget (www.snowmintcs.com) which handles irregular incomes. It’s a really cool program which uses the tried-and-true “envelope method” of handling your expenses. We’ve only been using it for a month but I definitely would recommend it. It takes some getting used to, but it’s definitely worth it!

  7. I’m the full-time student, part-time worker type. Here’s what I do.

    For each month, I plan my mandatory expenses. Food, rent, car, would fall in that category, but I discovered that I had very few mandatory expenses, as I live with my parents. My mandatory expenses includes about 40$ gas a month, and 20$ for my cell phone.

    That’s for the mandatory expenses. Whenever I notice the need to buy something (new shoes, because the old one begins to wear out, for exemple), I put it on a to-buy list. This list is ordered by priority. I put the name of the thing I need to buy, the priority, and the ammount of money I’m ready to put on it.

    Let’s say I recieve 100$ for a pay. Yeah, for the purpose of the exemple I’m some poor guy. So as I said I have 60$ mandatory exepenses. It leaves me with 40$. Assume that my to-buy list begins with Shirt (30$, High Priority), Watch battery (5$, Average Priority) and Shoes (40$, Low Priority). I keep 60$ aside, buy the shirt and the battery, which leave me with 5$. At that time I’m sad because my pay is now gone, but I have budgeted my way through my expenses.

    I do it on a two-weeks basis, so I cut my mandatory expenses by two. I buy a first 20$ of gas and put 10$ aside for my cell phone, then next pay I buy another 20$ of gas, and spend my 10$ + 10$ on my cellphone.

    Oh, and Quicken is my friend.

  8. As a novice freelancer, I’m in the same boat, so thanks for this question! My modus operandi has been so far to spend as little as humanly possible each month and hope I break even. So far I have, but it’s not been fun. I’m looking forward to a more reliable income…. hope it comes soon. From the comments I think your audience appreciates this type of question, Ramit– can you talk more about saving on a really low or variable income? I bet lots of us are recent graduates who are still trying to find their way in the world and experimenting with different financial paths, and not just the 401k crowd.

  9. Seems like Mary Hunt’s “Freedom” Account http://www.mdmproofing.com/iym/freedom.shtml would be an especially useful concept if you’re on an irregular income. The basic idea is to identify major irregular expenses and to subdivide a separate real-world account to save for those expenses, so they don’t sneak up on you.

  10. As is pretty obvious from the comments already, know your minimum and have an emergency buffer. Whether you earn an irregular income or not, this should go without much saying.

    Otherwise, I’d say feel free in letting go of the control. You don’t have to have your life planned out years or even months if even weeks ahead. That’s the beauty of life, so enjoy the lack of control (through established forecasting/budgeting measures).

    The biggest question might be, “I want to buy a house, but how can I plan for saving for that if I just don’t know?” First of, you have a general idea. You’ve got some history which lets you make guesses. If you don’t have any history, then it’s probably too early to think about buying a house.

    My biggest question is why do you have to have this figured out? What is the real problem because I don’t really see what the issue is. I think you’re trying to solve a problem that doesn’t really exist, but only exists as a mental fear (“I’m out of control and don’t know what to do”).

  11. The simple answer is savings!

    Live as cheap as you possibly can. If you are between the ages of 17 to 30, live like a student, even though u have a job. I read somewhere that in order to be rich in the future, live like a pauper for at least 6 years after graduating from college. I am in my 7th year living like shit, and am happy to say that I can sustain a family of 3 for about 7 years without any additional income. Yes, u read right…7 years!

    When I say live like shit, its not that bad. We have 2 cars (one is a luxury high end car), nice apartment, decent furnishing etc.

    To each his own, do whatever that rocks ur boat. But It has worked for me and IS working for me.

    I know a couple that would be in financial disaster if they lost their jobs because they do not even have 1/2 month savings.

  12. Addition onto my last comment. Your income doesn’t determine your budget. Your lifestyle determines your budget. Don’t plan your life based on what you earn, but based on what you need and want.

    Your income determines the probability of success of your chosen lifestyle. So it only seems natural to plan your life around your income, especially as we live in the constant “need more” society, but that would be wrong.

    Income has everything to do with options, and nothing to do with expenses. Confusing those two will invariably cause expenses to rise and income to seem out of your control when in reality its your lifestyle that is out of control and your income is out of sync with your lifestyle. Planning by income will either blind your to the short end of the money numbers (only living within what you can expect missing out on true adventure) or on the long end of money numbers (living beyond your means through continual adventuring). In neither case are you leading your own life, but you’ve given up control to your current financial paradigm.

  13. I myself have been looking into this problem for my boyfriend. He works in LA for the ever-wonderful entertainment industry, currently for reality shows. Every time they finish a season of a show (or just a pilot episode!) he has to look for new work, so his job turnover is ridiculous. Right now we’re just tracking his expenses and getting a calendar (old-school paper style!) so that he can get a visual of when all of this bills are due. I’m hoping that this will really help him, because I’m not sure what else I can do for him.

  14. I guess too much is being writeen on how-to-save and everything these days. One thing which pays of in any situation is don’t make a hugely elaborate plan for anything. Life is full of surprises and planning too much makes you rigid and inflexible. So try the following:

    1) Deduct the least you can save at the beginning of every month and make it a constant amount.

    2) At the end of every month look at how much is left in your checking amount?
    3) Put a cutoff on your checking account amount which you rebalance at the endo of the month. ie if the cutoff is 400 dollars and if you still have 600 dollars in your checking, transfer the execss to your savings or just splurge with half of it and save the rest…whatever you like.
    4) New month…new saving…secure checking!!!

  15. [...] decided to write this mostly because of this post at the great I Will Teach You To Be Rich called How do you budget when you have irregular income? The sum of the post is a reader asking Ramit how he should budget with his very irregular income. [...]

  16. There’s no real reason that a person can’t have a reasonable budget with an irregular income. I’m a freelancer myself and have come upon a similar issue. Still, there’s always going to be a minimum. Always. Unless you go without work, which really can’t be planned, fixed income or no.

    Know what you can do with that minimum and, more importantly, what you need every month to survive and maintain yourself. After that, it’s just skimming off the top and putting it in savings/investments.

    The thing is, I think we attach a little too much weight to knowing *exactly* how much we’re going to pull in every month. For me, the strength of a budget is not that I’ll know how much I can save in a year. It’s in knowing that I’m in touch with my expenses and relative income, which allows me to have a pretty good idea of where my money is going. That’s 90% of a successful budget anyway. The rest is gravy, really.

  17. I posted an article not long ago on this very topic. In fact it’s called Budgeting on a self-employed or irregular income.

    It’s a very detailed step-by-step guide on budgeting on an irregular income. Some of the overall tips are to definitely have a short-term emergency fund, to use cash for categories that tend to be out of control, and using a “just-in-time” budget where you allocate only what you need until your next paycheck. I hope it’s useful.

  18. I would plan in percentages that way despite fluctuations you will be continually saving a percentage of it. For example you could plan to save 15% in a high interest savings account ala ING Direct, and maybe an additional 5-10% of it in something riskier since you are I assume young enough to ride out flucations. Finally as others have mentioned you can utlize a income floor to base your spending on that way fluctuations generally higher than your minimum plans.

  19. My name is Matt hit the problem nail squarely on the head — how do you buy a house on an irregular budget? My wife and I scrimped and saved and paid cash for our house. It wasn’t easy and I know we missed out on some of the tax advantages to having a mortgage, but I’ll tell you it feels great to be 38 and be able to say “Hey, we’ll never have to worry about a mortgage.”

  20. Dono,

    Good job on buying the house cash. Buying the house cash is still better than paying interest and any tax advantage.

    Am i right?

  21. I googled just this thing a few months ago, and found http://www.youneedabudget.com. This guy developed YNAB and YNAB Pro that operate on the principles of a) maintaining a buffer, b) budgeting LAST month’s income for the current month’s expenses, c) giving each and every dollar a job, d) put money aside for the unexpected, and e) don’t abandon your budget if you go overbudget one month (the program actually forces you to “pay yourself back” the following month by lowering your available money to budget, rather than forcing you to spend less in that particular category). I highly recommend the program. I’m still getting the hang of using it, but I know that it’s the solution for me (just need to add in a touch of discipline).

  22. I see several possible solutions:

    1. Budget based on the lower, fixed portion of your income. All extra income goes into savings/investments.

    2. Budget based on a longer period of time. An income that is irregular on a week to week basis, might be very predictable on a quarterly basis.

    3. Figure out how much variability exists in your income, and build an appropriate extra amount into your cash reserve.

    4. Rather than having your paycheck deposited directly into your checking account, you could deposit it into your buffer savings account, and then set up an automatic transfer from savings to checking for a fixed periodic amount. This automates the idea of a buffer; when your income is low your buffer savings goes down, when your income is high your buffer savings goes up, but you always see the same amount going into your checking account. BONUS: Consider this transfer your “paycheck” and pay yourself first by sending a portion of it to your real (non-buffer) savings.

  23. Sri,

    I would say yes, avoiding a mortgage hanging over your head is well worth the effort and discipline it takes to save, even if, like us, it takes 10 years of saving. But it’s not easy. We drive a 7 year old car, for instance. And all our friends drive trendy cars …

    And as many people have said, the key to saving is to not fritter away any windfall which comes your way.

    By the way, this isn’t my brother-in-law Sri, is it? If so, hope you’re enjoying the snow up there!

  24. I also use the excellent “You Need a Budget.” I have semi-irregular income and the program forces you to budget for this month on last month’s income once you have a one month in savings. It makes your income feel less irregular since you know in February how much you have to budget because you have already been paid in January. It uses a modified envelope system which I think is quite effective. Check it out at youneedabudget.com

  25. Wow: Hustling your own gigs, regulary earning 2X your expenses, able to handle risks and huge uncertainty of income. Sounds like you are a successful quasi-entrepreneur … congrats.

    Why do you want to budget expenses? You do things to meet goals and if you’re already getting by fine without wasting time on budgets (i.e., you earn multiple times what you spend) then forget about it — don’t do all those “be as cheap as possible, save as much as possible” for no gain.

    If you want to save more money, earn more money, expand your lifestyle, etc then maybe a budget will serve you, and then you will know how to budget. To be as safe as possible you assume only the lowest possibilities of your revenue. To be as ambitious as possible you might assume 25% more than you can currently imagine for the year and challenge yourself to achieve it. If you need to save x amount then spend up until you are sure that over the year you will earn expenses + x.

    If your question is really about flattening your revenue out then just buy a liquid asset like a savings account or use a very low cost line of credit that you can fill up and draw from at will.

  26. B-Rizzle-Dizzle Link to this comment

    Firstly, OMG! “Large purchases come out of savings…” I thought that’s what savings was for, a cushion for emergencies. If you have to spend it, it won’t be savings. You are not pulling money out of a 401k, so don’t sweat it. I know I saved up for future large purchases, and called it savings.

    It does not sound like you have a budgeting problem if you are frugal and put money into a savings account. It seems like your losing touch with Quicken makes you feel like you have lost control of your finances, which is not the case. Being a large expense away from being broke is a fact of life for a lot of people.

    If you are a student, this is the way it will be until a stable job presents itself. (after graduation)

    If you are a consultant, then consider the ROI and get a different line of work.

    If you choose to be in the situation consider the following:

    Figure out how much you need to pay for the necessities. Then decide to save or spend what is left over. If you have a large known expense looming, wait until it passes and you have recovered to make some “wanted, but not needed” purchases.

    I honestly would not rely on any software to help manage expenses. It sounds like you need to simplify. If you have the money, pay off the debt and do not pay interest on it.

    Hopefully you can count your monthly expenses from memory, what is important will not be forgotten over night. If not, then the job is taking too much life energy for a minimal return.

    In the end, this seems like an email from someone too blind to see the reality of a situation. It is difficult to set up planned savings / investments if there is variable income and unknown expenses that impact day to day life.

  27. 1. Make a list of all *necessary* expenses such as rent, groceries, utilities, car payment etc. (Leave out the fun stuff such as entertainment, hobbies, pub-hopping etc. for now. We will come back to it later.)

    2. Find out the *minimum* amount you require for each category to sustain yourself. Add it all up. Let’s call this total, $A.

    3. Determine what your lowest possible monthly income is. Let’s call this $B.

    4. Is $A less than $B? If not, go back to step 2 and tweak it. (Eg., Do you need to move to a lower priced apartment? Do you need to take the bus instead of car? etc). *Repeat*, until $A is less than $B. Note: This step is not complete until $A is less than $B.

    5. Open three accounts. Call them, “Basic Necessities”, “Fun Stuff” and “Savings”.

    6. Every time you make some money,
    a) First put it in “Basic Necessities” account until it totals $A. This is where all your bills are paid from.
    b) After the “Basic Necessities” account reaches $A, split any additional amount into the two accounts “Fun Stuff” and “Savings”. Use a fixed rule to do this every time. Eg. 20% fun, 80% savings.

    7. Have fun only if there is enough money in the “fun-stuff” account. Seriously. This is where money for all your entertainment, hobbies, etc should come from. NEVER dip into the “savings” account.

    8. Invest the “savings” account wisely. This is where the money for the down payment of your home, retirement, emergencies etc. come from.

    9. (Optional) At the end of a year, if you have left-over money in your “fun-stuff” account, transfer it to “basic savings”. Lets call this amount $C. Repeat step 4 with the new formula ($A + $C/12)

  28. I keep coming back to this thread to see what others have posted because this is an issue my wife and I have dealt with for many years. I edit textbooks, and my wife teaches aerobics and yoga and used to be a professional dancer. Here’s what I think has worked for us for the past 15 years:

    1. Be frugal whenever you can. You don’t need a new TV or car more frequently than every 7 years. Talk to me next year and I might amend that to every 8 years.

    2. You don’t need software, but he or she who makes the LEAST money also makes the budget. When you’re bringing in less money than your spouse, you are more likely to budget responsibly. I’ve said “No” to Louis Vuitton luggage, and my wife said “No” to the NBA League Pass until last year.

    3 If you are going to go the freelance route, you’re going to go through periods of feasts and periods of famine. ALWAYS bank the feasts. Choosing the freelance path means your finances are inherently unstable. That means you’re not just saving for a rainy day, you’re saving for a rainy year, maybe a whole rainy decade.

  29. I try to always do a ‘necessity check’. Do I really need this? Do I really need to go out to eat tonight or can I make a sandwich? Do I really need a new pair of ski socks or can I wait a bit? This way I’m always living below my means.

    Once something comes up that I really want then I can go see the health of my finances and quickly see if it’s something I can ‘treat’ myself to.

  30. Occasionally, when all of my budgeting efforts have fallen short, I use a service called Obopay to get money, either in loan form or as an I.O.U. (and the service tracks running balances between friends). It’s a good way to fill in those monthly money-gaps.

  31. I also keep coming back to this post; I’ve been doing some consulting lately and am not sure how to set things up. I’m okay in the budget realm, and have set income up so that it all goes into a savings account, and I pay myself a regular “salary” that I then use just as I would if I were an employee of someone else. I like to keep my “personal” money seperate from “business” money so that my consulting is run just as a business would be – emergency money set aside for paying my salary on months where nothing comes in.

  32. This is such a great question. Thank you Ramit and everyone else. I keep checking back for everyone’s input.

  33. Thank you Ramit and everyone else. I keep coming back for more info.

  34. >and my spending even seems to increase due to much larger amounts of restaurant food (OMG NO TIME FOR GROCERIES!!1!).

    One suggestion I have for this is keep a “sanity fund” item in the budget somewhere. One or two hundred dollars a month to be used (or not) on things like that. Take it out in cash and don’t worry about where it goes, and if there’s something left over, buy groceries out of it. It’s a line item on the budget, so it’s accountable, but not causing stress.

    Also, consultant people, make sure you take out money to give to the tax man every quarter. Penalties for failing to file quarterly suck.

  35. I don’t budget.

  36. >and my spending even seems to increase due to much larger amounts of restaurant food (OMG NO TIME FOR GROCERIES!!1!).

    The solution is the same as for managing your money: plan in advance.

    Invest in a small deep freeze.

    If you’re no cook, find a friend who is and who(for the right price) is willing to do a couple of pots of things which you can freeze in takeway food containers or freezer bags in one-meal portions. Or – find a source of commercial frozen meals that are palatable and healthy. They’re generally cheaper than restaurant meals and these days, some of them are pretty good. Go for stews and curries. Pasta can be okay too (basically, stay away from meat and 3 veg, it reheats badly). Soups, of course, are perfect for freezing.

  37. I’ve been working freelance for about two years, everytime the pay check comes in (which is in irregular order), i’ll cut 1/3 of it into my FD savings. the rest of 2/3 will be used to cover all the expenses (both personals and biz). when time is right, the money in the saving accounts will be transfered to appropriate investment vehicles.

    I still goes overspent some time for now (expecially with credit card) but by doing this, its been the best in limiting myself to spend within my means.

  38. I used to have an irregular income every so often, and the easiest 2 things to do are:
    1. Come up with a list of at least estimates of your monthly payments. You WILL know beforehand approximately how much you expect to pay on utilities, rent, any credit card bills. Then factor in about $50 per week for groceries and $150 per month on utilities (upper-level estimates – in NYC, these are fairly valid!) – and so on.
    2. Then take the lowest number you are likely to receive and run the above numbers against that. This should give you some indication of how much “spending cash” you might be expected to have left over, in a worst-case situation (i.e., your expenses don’t become less, your income doesn’t go higher). This will give you some starting point of how much to start putting away each month, no matter what. It could be $200 but trust me on this – I’ve found money for $1500 apartment deposits plus one month rent, just by squirelling away that “$200 a month”!!

    Over and above everything else – DON’T BE TOO HARD ON YOURSELF!!! Some months just will be crappy, and expenses will pop up out of nowhere. Don’t worry too much.

    And here’s the best advice I was given, even if 2 years too late:
    1. ALWAYS try to keep an emergency fund (even $500 – yeah, I know it’s a lot!) can make a difference in a bad month)
    2. Absolutely, positively do NOT use your CC for any “wishful” expenses. I am still paying mine from 6 years ago!!!

  39. [...] You To Be Rich” asked his readers about budgeting on an irregular income to his readers and here is what they had to [...]

  40. I’m 26 and recently joined the ranks of independent consultants after a stint as a consultant at a Silicon Valley software firm which gave me a good underlying skillset and social networking skills/contacts. Those of us who “go independent” know that the financial rewards can be great (I’ve personally seen an increase in income of 100% on an already high “employee” income). Unfortunatly, if you’re young, you may not have the safety net needed to weather a 4 month “dry spell”, so plan carefully!

    I’ve not really found that there is any great strategy for how to handle this problem faced by those of us on a variable income. I’ve been working continuously since leaving my “regular job” and have a couple of tips.

    1) DON’T put all your eggs in one basket. If it all possible, keep multiple clients, even if they sometimes feel that they could use you more of the time. I often negotiate with my clients to take a week or two off to see another client when I know the requesting client is in a bind, and assure the consenting client that I’ll be there around the clock when crunch-time comes!

    2) DO investigate your tax situation thoroughly. I’ve found enormous amounts of my expenses can be claimed back, just by carefully looking at the rules, and speaking with an experienced accountant.

    3) AVOID planning vacations like a “regular” employee. By this, I mean just because you may be coming to a client regularly, or even work out of their office, don’t request “time off”. I plan my vacations around times when I know business will slow down or there will be fewer billable days, such as the end of a big project or winter holidays.

    4) DO carefully plan your vacations. This one applies to everyone. I love vacations to low-cost locales like Thailand. I’ve found that I can take 3 weeks off, and rent out my apartment in London such that the entire adventure ends up costing little more than the cost of the flight. Check out sites like Craigslist in the US, or Gumtree in the UK for these types of trades, or people looking for short term rentals. **Make sure you have some reason to trust the renter (deposit, or your own insurance). Again, book the travel for a time when you won’t make much money anyway, don’t risk upsetting clients and losing out on that contract!

    5) DO buy business cards/website/. Sites like e-lance.com can design software, websites, etc. at very low cost provided you’re capable of designing a real business requirements document for the typically non-business savvy developers working on your project. My $3,000 investments in these has helped me close over $80,000 in business, as well as recruit other independent contractors with similar skillsets into my contact group (useful when you can help a client staff one of them, and make a regular percentage without even working!).

    6) When you’re planning your finances, remember why you went “independent” to begin with – you work at your pleasure, and that’s worth something (even if you can’t include it in your budget).

    I plan for 40 days off per year (vacations, public holidays, sick-leave). This amounts to about 85% utilisation. DON’T calculate based on a 240 day work-year… it won’t happen unless your client loves paying you overtime that they didn’t budget for!

    I’ve not found Quicken, GNU Cash, etc. to be terribly useful when it comes to managing my money. I will say that I’m somewhat excited to see what’s going to be offered by http://www.mint.com‘s eventual offering (currently “vaporware”). I end up spending more time documenting and reviewing/comparing these things than taking any pro-active measures. Perhaps irresponsibly, I’ve taken a budgeting approach that is much more broad. I put away for what I have as fixed expenses (including 10% to savings), the rest is budgeted based on spending twice as much on entertainment as I did at University. I also usually throw in a small vacation fund, just in case I decide to go somewhere where I can’t live on $5/day!

    My money allocations aren’t as sophisticated as I’d like, as I need to be very liquid and stable in the upcoming 2 years (paying cash for an MBA), but I always know where my money is, and that gives me piece of mind, if not the returns I could be seeing.

    Feel free to drop me an email if you’d like to chat about anything I’ve said!

    Wael “a.k.a. Wa-Eazie”
    welrifai@gmail.com

  41. Regarding splodge’s idea about paying a friend to cook some stuff that you can freeze for you… I wouldn’t introduce money into a friendship in such a way, the only thing worse is taking the food for free. (read: Buck-up, spend the 30 minutes, and cook yourself a good meal.)

    I was an all take-out guy (which meant gym time replaced cooking time) until I realised how many sites are out there with quick and easy to make dishes.

    http://search.bbc.co.uk/cgi-bin/search/results.pl?q=recipes+quick&scope=all&tab=all&recipe=all

    On top of this, many grocers offer free delivery for orders over a certain amount, and will commit to a one hour delivery window (I can personally attest to this deal in London, Manhattan, Wash. DC).

  42. Could you please tell me where I can find YOUR suggestions for the same Ramit?
    I’m sure you have it somewhere but I can’t seem to find the post.
    Thanks!