Most content on the internet on debt repayments are based on the presumption that the borrower has a constant source of income. For one who does have a constant source of income, it can be quite easy to clear of debts sooner.
But that of a person who does not have a constant source of income? Such a person can be one who depends on commissions or one who is self-employed and thus has an unsteady income. How can such a person clear all debts in time?
Budgeting can be pretty tough when you don’t have a regular income source. You have to meet all regular expenses while having to save for the future at the same time! If you have to do these with irregular income, imagine the chaos that can follow.
However, it is not impossible. It just needs discipline and a different approach for paying off outstanding dues.
Here are some ways to pay off dues when you have an irregular income.
Build an emergency fund: The very first thing you need to do is to build an emergency fund. It may seem hard when you have limited money and irregular income, but doing so will help you in the long run. Besides, you don’t have to keep a huge portion of your income in an emergency fund. Just make it a habit and start building that fund. It will help you when you have no incoming income.
Manage your money closely: When you have a steady income, it is easier to manage your money. With an irregular income, you need to keep a closer eye on income and expenses. This will help you to manage your money more efficiently.
Be jealous when spending money: There will be times when you start getting a lot of income. But don’t splurge at this time. This is the time when you need to save the excess income, or at least spend only what you absolutely need. You can keep the excess income in your emergency fund.
Get and keep a good credit score: This one’s very important. You need to maintain a good credit score in case you really need credit cards and loans. One easy way to increase the score is to take on small loans which you know you can repay easily. This increases your credit score.
Whether you have an irregular income or not, you require a long-term strategy for clearing debts and increasing your wealth.