Creating a Budget with a Part-Time Job
If you’re working a part-time job, then having a solid budget in place is more important than for people with full-time employment. Unfortunately, having a part-time job also makes it especially hard to both create a budget and stick to it. The good news is, it’s not impossible. With the right advice and guidance, customizing a budget isn’t even be all that difficult, and it can substantially improve your financial situation in the long run.
Here’s a step by step guide to getting through the process of making a budget for your part-time income. If you do find that budgeting doesn’t improve your financial situation quickly enough to avoid a financial emergency, car title loans could be the right option for you. After all, you only get a tax return once a year, and bills and other expenses won’t wait that long.
Determine Your Actual Income
The first and most difficult part of creating a budget for a part-time job is that depending on what field you work in, your income can vary greatly based on the consistency of your hours and the time of year. Tips for those in the service industry, the number of hours for part-time jobs, and commission bonuses from sale jobs are all examples of variables that can cause your income to vary.
So how do you effectively track your income if it is constantly fluctuating? The easiest way to overcome this challenge is to track all your income over the past year or for however long you’ve been working at your current job. It’ll reveal spikes and dips that can serve as a roadmap for what you can expect to earn in the future. You can also get a fairly good idea of what your average monthly income is.
Find Your Expenses
The next number you’ll need for building a budget is determining what your total monthly expenses are. This will be easier to figure out, as most expenses tend to vary less from month to month, although major expenses like car repairs or medical costs can skew the figures. Ignore those big outlays of cash items for now, and just focus on the basics like rent, utilities, and all your other set monthly expenses.
Now take all those big-ticket costs, add them up for the year, and then divide them by twelve. The resulting number is how much you’re going to need to put into an emergency fund each month so you aren’t caught flat-footed when another financial emergency inevitably comes up again.
Find Your Goals
Now that you have an idea of how much income you can expect going forward and what your monthly expenses are on average, it’s time to begin setting goals for what you want to achieve. It’s hard to succeed if you haven’t defined what succeeding looks like. Want to save for retirement? Buy a new car? Afford a vacation? Those are all attainable goals, and all ones you’ll need to save up for before being able to afford.
Once you’ve written out your goals, take whatever money is left over each month and put that towards your goals. And even just working part-time, you’ll be surprised how quickly you’ll begin to achieve them. Budgets are powerful tools, and if you follow these steps you’ll be able to leverage that towards the financial life you want to lead.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.