On this new episode of The Casey Lewis Podcast I answer 2 questions from the internet, discuss some interesting stories from the week, and discuss how to manage a budget when you have irregular income.
Questions From The Internet: (Starts at 6:10)
Kelsey – “I was in a car accident where someone rear ended me. I wasn’t seriously injured but my car was pretty badly damaged. What things should I be looking for in the insurance process?”
- 3 parts to an auto insurance claim.
- Personal Property Claim
- Depreciated Asset Claim
- Medical/Lost Wages/Pain & Suffering Claim
Jeff – “How do you keep track of your expenses in your bank account if you don’t use online software?”
- I personally use a transaction register. Each week I review spending, write it down in a transaction register and match that up with my online account.
- I use tools like Dropbox to store pictures of receipts so I can have everything in one place.
- Keeping my accounts by hand allows me the opportunity to be hands on in understanding where my money stands.
Irregular Income Budgeting (Starts at 15:17)
- Put all your income into a business account. If you’re a commissioned salesperson, put your paycheck into a separate account for that income.
- Determine how much of a salary you are confident you can pay yourself out of that business account consistently. Big enough that your personal account doesn’t go negative, but not so big that you don’t leave a cushion in this business account. To determine this salary amount, review your business profits, or paychecks, for the past 90 days. It’s reasonable to assume you can maintain that average over the next 90 days.
- Pay that salary on a “pay-day” each and every month.
- Use personal account to pay all personal expenses like mortgage, groceries, vacations, savings, investing, etc. Your income will be stable because you’re paying a flat salary to yourself each month.
- Build up a salary reserve of 3-6 months in your business account in addition to your emergency account.
- To increase your income, pay bonuses quarterly, based on your own. If you consistently can raise your salary, then do it.
Joke of the Week (23:25)
What do you call a turtle that pokes people?