One of the most difficult part about college income is that you have a budget that’s irregular. In most jobs, you get paid on a particular day of the month and you can expect a paycheck on a given day. Some people receive their paychecks monthly. Some people receive their paychecks twice a week or every other week.
When you’re in college, however, your paycheck comes whatever you can find money. Perhaps you have a part time job. Maybe you have income from investments or other passive income. Perhaps you receive student loans. Regardless of how you receive your money it will take you a while to figure out how to budget it correctly.
Create a Budget, Even Without a Set Income
Even though you don’t know how much money you’ll be making, you still need to have a budget. The trick is that you just don’t know how much to budget for.
The solution? Create the amount you budget with.
Figure out the minimum amount of income you receive each month and use that as your basis for budgeting. Budget your important bills and expenses based on this amount. Any excess you have will then go to other payments or other expenses — the more you make, the more you can pay for.
Organize Your Accounts
Irregular incomes require organization and consistency. This applies to paperwork around the home, but also your banking accounts. You’ll want to have separate accounts for long-term savings, short-term savings, and checking and daily activities. With an irregular income in college, you’ll need a more heavily padded savings account to make it through lulls in income. Having a small short-term savings will help you avoid using your large long-term savings for things that aren’t emergencies.
Make Tough Decisions About What’s Really Necessary
Another difficult decision about money in college is deciding which opportunities come up that you want to take and that you can afford to take. The answer is to decide in advance what is a necessity and what is not a necessity.
Paying for housing costs like rent and utilities are necessities, and food is a necessity. A fun trip outside the country which a faraway place? Not a necessity. Bonding with new friend by going out for drinks or spending time together is a necessity. But spending a lot of money shopping together or eating in places outside your budget? Not necessities. Make those hard decisions in advance so that you can protect your budget when you go outside
Budgeting on an irregular income doesn’t have to be difficult, if you know how to do it. How do you budget, if your income is irregular?