How a Budgeting App Can Help Create a Perfect Budget for Irregular Income?

People having irregular or variable income often stay at the threat of meeting financial crisis, but not anymore! By learning the fruitful use of a budget app, you can stay financially stable all year round and take care of your necessities and recreational needs unfailingly.

Whether you are a contractor, freelancer, or a gig worker by profession, these wealth apps promise everyone to manage their expenses better while saving money for unforeseen emergencies. Want to give these apps a shot? Go through this write-up beforehand to have a clear idea of how you can use it to track and manage your variable income. 

Best Ways to Use a Budget App for Tracking Variable Income 

Any income other than a fixed wage is considered a variable income. For example, the hourly payment, overtime payment, rental income, or income from your newly started small business etc., fall under the category of variable income. And by using the Android best budgeting appas per the below-listed tips, you can lead a financially fit life! 

1. Create an Average Monthly Income Budget 

Using the variable income to pay bills might seem easy, but very challenging. Once, you lose track, you remain in constant fear of overspending in your day-to-day life. That’s why, having an estimation of your average monthly income is crucial.

Once you install the budget app, you can find options for creating your monthly budget.

However, always prefer to consider your total average lower than you expect. For example, if you expect to earn £4,832 per month, input a lesser amount, for say £4000 and calculate your overall monthly income. This, way you will never have to deal with displeasure and disappointment. 

2. Plan for Emergency Funds

Saving money from variable income for emergency funds is challenging, but we have an amazing idea for you! First, create an emergency fund on the budget app you use. Now, when you actually receive your weekly payment, keep aside the extra money and transfer it to your emergency fund.

Since contract-based jobs and gig economy workers do not have fixed incomes, there could be times when you earn less than usual. At those times, you can use your emergency fund balance to pay your bills on time, without stressing your pocket. 

3. Set a Reminder on Your App to Pay All Your Rent on Time

Paying all your bills together might seem like a burden, but it frees you from all the pressure! Ask your employers to pay you monthly than weekly. This helps in better tracking of your income and expenses.

Suppose, you get all your payment within the first week of the month, try to pay all the necessary bills by the 10th of the month. This includes house rent, electricity, monthly groceries etc. Now, use your Android best budgeting app for setting reminders about the bill payment to avoid fines and penalties. 

4. Separate Your Savings Fund from Spending Fund  

Since you have already planned to keep aside the extra money from your total monthly income, you can use the remaining balance for your day-to-day spending. Using the fund money for recreational purposes could be tempting, but always restrain yourself from doing that. Remember, the money you save on your emergency funds will help you and your family during the time of hardship. So, keep it aside untouched until and unless the right moment comes. 

5. Set Monthly Expense Limit  

You need to run your entire month with the money you have in your day-to-day spending fund. So, overspending can create a distressing condition on your wallet at the month’s end. A budget appcan be an excellent way to track your expenses and stay within your limit.

All you need to do is set a monthly expense limit. When you are about to reach that limit, the app will keep updating you. This way, you can spend the entire month, balancing your expenses efficiently, feeling no pressure or burden.

However, for this, you would need to maintain using the app prefer making online transactions. Otherwise, you will be required to input the details of your offline transactions and receipts manually. The best part about these apps is that you can check all the expenses through a graph or chart, and cut off the unnecessary expenses wherever possible.

This is especially helpful when you are planning for a new purchase, like a new gadget or something. The money you save every month from your spending fund can help you collect funds for your much-desired new purchase.   

Wrapping Up

If you have just started your career as a freelancer or part-time worker with variable income, you might experience trouble tracking your expenses. But once you get familiarized with a budget app, things will get smoother gradually. Think to and fro before choosing a wealth management tool, check the ratings and reviews to expect the best outcome.