Comments on: Make Sinking Funds Work For You – No Matter How You’re Paid

By: Rachel Porter

Rachel Porter — Tue, 17 Mar 2009 19:56:40 +0000

There is a lot of great info. and good feedback here. I would just add to the encouragement to say, definitely set aside for non-monthly expenses. Otherwise, once they come due, they can be BIG budget busters. Not planning for non-monthly expenses can throw you off to the point (if you're not careful) of stopping or discontinuing your budget because of discouragement and uncertainty. Keep on keepin' on ladies. And to address irregular income, both my husband and I are self-employed, so we've dealt with this issue a lot. What we've found best (and what I recommend to my clients) is to draft an Irregular Income Planning Sheet, along with your monthly totals that you want to spend on aka the “Monthly Cash Flow Plan” should be a regular part of your budgeting routine. It lays out exactly how much money you need to bring home each month to survive and prosper. On this form, simply look at the individual items from your “Monthly Cash Flow Plan” and prioritize them by importance. Ask yourself, “If I only have enough money to pay for one thing, what would that be?” Place that at the top of your list. Then ask, “If I only have enough money to pay for one more thing, what would that be?” That goes second on your list. Keep using this method for all the items on your cash flow plan. Now, you are ready to allocate your paycheck. If you get a $1,000 paycheck, you will spend that $1,000 down the list until it is gone, recording the cumulative amount spent in the “Cumulative Amount” column. When the money runs out, you are finished spending. This is why the most important items are on the top of the list. Be prepared to firmly stand your ground. Things can have a way of seeming important when they are only urgent. For example, an opportunity to go on a less expensive vacation because your being offered off-season prices may seem important, but in reality, it’s only urgent (meaning time sensitive.) Urgency alone should not move an item to the top of the list. Sorry for the lengthy reply. Hope you found it helpful. Rachel Porter´s last blog post...A Visit to Nashville for Some Small Business Training

By: Amy @ Living Locurto

Amy @ Living Locurto — Mon, 02 Mar 2009 05:18:00 +0000

I love ING and have been using it for a while now. I like how you have different accounts for each category! Great idea. I'll have to try that. Amy @ Living Locurto´s last blog post...I Heart Faces - Week 8

By: Fave 5 links «

Fave 5 links « — Sat, 28 Feb 2009 14:57:38 +0000

[...] your family rely on irregular income? Learn how to manage your money, no matter how you get paid. {Simple [...]

By: Sharon

Sharon — Sat, 28 Feb 2009 12:16:02 +0000

Btw, First IB also lets you effortlessly set up mini-accounts. What a great system!!

By: Sharon

Sharon — Sat, 28 Feb 2009 11:27:34 +0000

I use First Internet Bank of Indiana (First IB) which was highly recommended as an online bank back when I did the research in 2003. I haven’t had a bricks-and-mortar bank since; paper checks are mailed in postage paid envelopes.

I don’t think they let you easily open multiple accounts, though. I just have one account, make a regular deposit into it (the totals of all of those lines on my Google docs budget spreadsheet), and only withdraw for the categories I’ve set aside.

By: Becky

Becky — Sat, 28 Feb 2009 07:03:15 +0000

My husband gets paid biweekly, so we have a separate checking account set up for just bills. We have a set amount (all the monthly bills, divided by two, plus the annual bills, divided by 12) that we pull from each pay check, and transfer into the other checking account. Then for his two “extra” paychecks a year, we have that same amount we can save without even feeling it.

By: Lucie @ Unconventional Origins

Lucie @ Unconventional Origins — Sat, 28 Feb 2009 04:56:04 +0000

This is so insanely helpful, there are no words. We have been trying to set up a budget for awhile, and we do okay, but we get paid very irregularly (think quarterly) and are both transitioning into new careers. It is so hard to budget, and some of the stuff you suggest here sounds great. I am about to email the link to this to Stacy! Lucie @ Unconventional Origins´s last blog post...Hoping babies get AIDS (or, how NOT to win back voters)

By: Amanda @ www.kiddio.org

Amanda @ www.kiddio.org — Sat, 28 Feb 2009 03:43:43 +0000

Great post! I love these little windows into what others do. Call me nosy

Amanda @ http://www.kiddio.org´s last blog post…Friday Finds

By: Karen

Karen — Sat, 28 Feb 2009 01:04:35 +0000

That looks just like our ING account. We get paid twice monthly and, as you said, it really makes little difference. Just a different number to divide by!
We started with our emergency fund there and as we got our financial house in order we were able to add in our sinking funds. We keep very little in our local bank as ING works for nearly everything and is so easy to use!

By: Clara S.

Clara S. — Fri, 27 Feb 2009 23:40:34 +0000

I love this idea and can’t wait to share it with my husband. We currently do like others mentioned and have everything broken up on paper and then deposited into the same account. The problem is we (okay often it is I) like to “rob Peter to pay Paul” so to speak. We can “borrow” from our Christmas money for vacation and then repay it with overtime money or extra income; which isn’t really staying on a budget even though the cash is there and we’re not borrowing on credit. Having separate accounts makes this much more difficult to do. Thanks for sharing.