So many people faced layoffs and unemployment in 2020, but many are finally getting back to work this year. For others, though, contract and temporary positions have been making ends meet through the last year and a half. If you find yourself in temp roles, here are some tips to help you manage your finances.
Examine Your Expenses
The first step is to know where your money is going already. Take a minute to review your current expenses. Look at your rent or mortgage payment, car payment, insurance, utility bills, food, and entertainment expenses. Create a spreadsheet or even just a list on a page of your planner so you can easily keep track of the money you pay each month.
Cut out the Luxuries
Next, examine the money you spend on extras. While all work and no play is never a great strategy, there may be things you can eliminate from your regular expenses. For example, if you buy coffee on the way to work every day, you can replace that by making coffee at home for a fraction of the price. The same may be true for meals, so take a look at what you spend and how you can tighten it up.
Create a Budget
Now that you know the money going out, you can create a budget that accounts for the money coming in. Even though your income may be variable if you’re working temporary jobs, you can give yourself a general guideline by looking at the average you make each week or month to plan for paying your bills. You can even create another account where that money is deposited, so you only use that for predetermined expenses.
Build Your Emergency Fund
Because you will have a variable income as you work temporary jobs, there will be some months you make more than others. Once your expenses are paid, and you give yourself a little discretionary fund for entertainment or food, put the rest of the money in a savings account. This will become the seed for your emergency fund. Then, when you have leaner months, you have access to the funds to help you through.
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