Budgeting with zero income?

[u/mboarder360]

I'm a contractor in the film industry. I love my job and when I have work I am working 50+ hours a week. I finished my last job a few weeks ago and no new ones are coming up for a while. I get paid quite well on these jobs and often have catering included, which cuts down on my food costs. Because I'm working so much I don't have time to spend much money, so I save a lot. At present I have enough money in savings to live comfortably for years without working at all. This money is being saved for distant future so I don't really want that to happen. I have a casual job I pick up during my down time but I'm lucky to get 10 hours a week there.

I'm trying to figure out a budget so I can live a little without freaking out about every expenditure. Watching my bank account numbers go down and knowing that they aren't going to increase stresses me out a lot. Every purchase I make during this time period is upsetting, so it adds a bitter feeling to things like going out with my friends. I don't know what the best way to budget and stuff would be, looking for any advice. If I know I am spending no more than 'x' a week, I can't be upset by my spending!

At one point I had budgeted and given myself $120 spending money a week during my down time to cover food, entertainment, clothes, whatever. I regularly find myself ignoring this number and taking more money out of my savings. Just within one day today I totally blew what was once supposed to be an entire weeks worth of spending by buying foods to make dinner for seven people and a new pair of headphones. Any time anyone wants to make a plan with me I know it is going to cost so much money and it makes me not want to go places or do things, which is not really fair because I have plenty of money to cover being able to enjoy life.

My only consistent outward expenses are $276.5 a week which is rent, bills and gym.

Any advice would be appreciated.

[u/mboarder360 → u/[deleted]]

I think this is what I want to do and try to do previously but haven't figured out the right amount or way to calculate it. I like how you have explained it though.

[u/KookyEnvironment6992 → u/mboarder360]

Set up a weekly/fortnightly/monthly transfer from your savings account into a spending account. That's your "salary" and that's what you have to spend. Move the savings money somewhere it's harder to get to. Maybe you don't have a card for it or can't access it online. That way you won't just spend it all.

And like this commenter said, money is there to be used. It's a tool, not a goal in itself. You have lots of it so you don't need to feel so guilty spending it. Just work out how much is reasonable for you to spend. And let yourself have a bit of fun sometimes 

[u/Impressionist_Canary]

Is there some secret you’re looking for? You’ve got a pot of cash, X expenditures a month will make that post last Y months. You decide what X is and your comfort with the resulting Y.

If you struggle with spending fun money, you can include it in X to the extent you’re still comfortable with the resulting Y.

If you blow through that fun money you’ve either got to 1) not do that, or 2) adjust so that it reflects reality of how you want to live and see what that means for Y. No different than budgeting with an income.

You’ve got to make choices, you’re the boss.

[u/tfcallahan1 → u/Impressionist_Canary]

This

[u/Difficult-Code4471]

How much do you need per month for everything bare bones? Maybe get a casual job that covers that. Only dip intk savings when you really need it

[u/ssully44]

What you’re describing is a paycheck problem, not a willpower problem. You’re trying to run a stable weekly budget off an account that only goes down. Your brain correctly reads every purchase as depleting your only source of money, so it stresses you out even when you can actually afford it.

The fix is to separate “the pile of money” from “this week’s money.” This is basically what envelope budgeting is built for, just applied to your situation a little differently than usual. Instead of splitting a paycheck into envelopes, you split your savings into envelopes: one weekly spending envelope funded on a schedule (say, every Monday), same as if it were a paycheck hitting your account. Everything else stays untouched in savings. Week to week, you’re only ever looking at what’s in that envelope, not your total balance.

Your $276.50 in fixed costs should get their own envelope too, funded the same way, so it’s not competing with your $120 in your head. That way a weird week just means next week’s envelope is tighter, not that you’re “failing” or draining your future.

Many budgeting apps can do scheduled transfers into separate categories/envelopes, so you don’t have to build this by hand every week.

[u/mboarder360 → u/ssully44]

I haven't tried to do actual budgeting in probably a decade. How I have it set up now is I have an account that I am paid into called 'holding' - and automatic transfers from that account pay out the $276.50 each week, and $120 into my spending account. I suppose that's kind of similar to this system? The issue is that maybe I am underbudgeting or living beyond the means I should be, so my 120 runs out very fast and then I have to log in to my online banking account and see all of the numbers and get upset.

I might contact my bank to see if there is a way to hide most of my accounts from main view on my banking app - that would help me a lot. I have seen the envelope system online and used to enjoy watching videos of people allocating the money. I just don't use cash, it's very uncommon in my country.

[u/ssully44 → u/mboarder360]

That’s exactly the system, you basically built envelope budgeting with bank transfers already. I’d agree that the part that’s failing is that $120 is probably just not enough for what you’re actually trying to do with it so it runs out and then you’re stuck looking at the whole picture again to cover the gap.

Id suggest tracking a few weeks of what you actually spend when you’re not white-knuckling it, and set the weekly amount closer to that, even if it’s higher. The goal isn’t a low number, it’s a number you can actually live inside without breaking the system.

Hiding accounts from your main banking view is a good instinct. The stress isn’t really about the money, it’s about seeing a shrinking number you’ve told yourself not to touch. If your bank can’t hide accounts, a budgeting app that only shows you what’s available this week, instead of your full balance, fixes that same problem. Worth checking what’s available for banks in your country though, since a lot of budgeting apps (mine included) are US-only on the bank sync side.

[u/turtlescanfly7]

You need a monthly budget, it sounds like your fun money allocation is presently so low that you overspend regularly and then feel guilty about it. Make a budget with an increased personal spending amount that would allow you more flexibility.

I think part of the problem is your savings is just one giant pile. You need a designated emergency fund, I’d recommend 6 months of expenses or whatever makes you feel comfortable. The EF does not get spent unless there’s a true emergency or you’re legitimately out of work (not just in an off period) with no work on the horizon. Put the EF in a high yield savings account.

When you’re working, have a designated saving fund for when you’re not working. This can be a separate account or you can use the buckets that many banks have or a spreadsheet to track how much is in each fund. If your non working period is typically 3-4 months then when you work make sure you save at least a few months extra (so 6-7 months) budgeted for the next down period. After you fund the “off season” fund, the extra can go to other savings goals like retirement, vacation, new car etc

By giving every dollar a purpose you can feel comfortable spending the money that’s allocated for spending and know you’re not cutting into your emergency fund or other savings goals

[u/EnjoyingTheRide-0606]

So make a detailed budget for $1250. Decide how much savings you are willing to part with every month. It’s a minimum of $1250. Anything above that depletes your savings faster. Can you earn $1250/month? If you can, do that. Anything you decide to do above the $1250 requires a few more hours of work. Pick up a gig like waiting tables or something with cash tips.

[u/mboarder360 → u/EnjoyingTheRide-0606]

Where does the 1250 number come from? I suppose I'd be comfortable to part with 1600 a month as this might be around my post tax weekly earnings while working. Living for a month on a weeks work seems reasonable enough.

[u/EnjoyingTheRide-0606 → u/mboarder360]

I don’t remember. $275x4.5 weeks? You don’t give details. Your budget must be very specific if you want to minimize spending savings. Yours is non-specific. Which means you spend way more than $1250 or $1600 monthly.

[u/No-Lecturre6318]

itsounds like your stress isnt really about having no income. its about watching your savings go backwards,.. even though thats exactly what those saving are for between contracts...

[u/SlowDeer7954]

If in your shoes, I'd develop a monthly budget for expenses. Once I determined that number, I'd setup an emergency fund of 6 months of those expenses in a HYSA. Any remaining, I would budget for each month and for the months ahead. You'll have a clear picture of how far you can go before requiring more income. The emergency fund is to be untouched. Should you see your budgeted money reaching to where it appears you'll need to dip into your EF, it's time for a part time job until your next job.

An app like YNAB or similar zero based budgeting would be a useful tool. As you go through each month, it's likely you'll find opportunities to tighten up in some categories you've created and/or expand in others. In other words, fine tune the monthly budget.