Managing irregular income as an entrepreneur

Build a system to make the most of feast-or-famine income.

Mary ·

Before You Start

Goal: Leave with a written system to prevent budget emergencies.

Watch: How to Budget With Irregular Income: Real Stories (NerdWallet) — Members are encouraged to read beforehand, but a quick recap at the meeting works too.

Prep: Before the meeting, write your income and major business expenses for the last 6–12 months — rough estimates are fine. You'll use these numbers in tonight's activities.

Meeting Agenda · Approx. 60 mins

  • Member Updates · 10 mins
  • Icebreaker · 10 mins
  • Key Takeaways · 5 mins
  • Activities · 20 mins
  • One Action · 10 mins
  • Wrap-Up · 5 mins

👋 Member Updates · 10 mins

Go around your Circle and share personal updates. Keep them brief and focused on significant changes or important decisions since the last time you met. It's OK not to have one every month. If you have a One Action update from last time, share that too.

🧊 Icebreaker · 10 mins

Invite everyone in the group to share. Keep answers to one or two minutes per person.

Think of your last "famine" month. What was one way you prepared for it in advance? How did it go?

🔑 Key Takeaways · 5 mins

  • Running your own business is an act of leadership. Every system you put in place — how you pay yourself, how you handle a slow month — is a norm you're setting, the same way a CEO sets norms for their team. The more women who model strong leadership practices, the more it changes what leadership looks like.
  • Most accountants agree on the order money should go out each month. First, pay the real, required costs of doing business: a subcontractor, rent, a team, a tool. Next, set aside your estimated tax percentage based on what's left after expenses go out. Then pay yourself, and then set aside a percentage for your reserve.
  • Make a budget based on your average month. In a strong month, the surplus (after costs and tax) goes into your reserve. In a slow month, you draw from the reserve to still pay yourself your normal amount. Your target pay should reflect what's sustainable across a normal year, not your best or worst month.
  • Transfer your business expenses, estimated taxes, reserve, and salary on one fixed date each month. Make sure to transfer them in that order so that the essentials are covered first.
  • A reserve fund covers your salary in famine months, and it also lets you say no. It's a cushion for emergencies, and it lets you turn down a client who isn't a good fit.

🏋️ Activity 1 · 10 mins

Find Your Real Average Numbers

The calculations below are based on the most common system that accountants use for small businesses or freelancers.

  1. List your income for each of the last 6–12 months, as accurately as you can.
  2. For each month, subtract your real average operating expenses (a subcontractor, rent, a team, required tools). What's left is that month's profit.
  3. Calculate your average monthly profit using these numbers.

Discuss as a group:

  1. Did these calculations shift anything about how you see your monthly budget?
  2. If you already calculate your budget using this system, what benefits or problems have you seen? What advice would you give someone just starting out?
  3. If you don't already have a reserve, do you plan to build one? What challenges do you foresee in doing that, and how can you overcome them?
  4. Does your lowest month often fall at the same time of year? Can you think of new ways to supplement your income that month?

🏋️ Activity 2 · 10 mins

Set Your Monthly Payment Protocol

Write it down:

  1. Based on your average profit from Activity 1, decide on the percentage of your profit that you'll set aside for taxes on a fixed date.
  2. Then, decide a fixed monthly amount to pay yourself. This is the number you'll aim to take home every month, regardless of that month's actual profit. It should be an amount you can usually pay out of your post-tax profit, aside from rare "famine" months when you need to draw on your reserve.
  3. Pick one recurring date each month when you'll pay everything in this order: running costs, tax set aside, pay, and then reserve percentage.

Write out your monthly payment protocol. (Fill in your own numbers.)

  1. My payments will be made on the ___ of each month.
  2. After paying running expenses, I will transfer ___% to a separate account for tax savings.
  3. I will pay myself a fixed monthly amount of $____.
  4. I will transfer ___% to a reserve account, until it reaches ___ months of expenses.

Discuss as a group:

  1. Is the salary number you picked similar to what you're paying yourself right now?
  2. How big does your reserve need to be for you to feel secure?
  3. Do you think this system is realistic for you to put into practice? How would you change or improve on it?
  4. Could your Circle help you stick to this plan, e.g. a monthly check-in as a group, or an accountability partner who you regularly check in with?

🎯 One Action · 10 mins

Commit to one concrete action — big or small — you'll take before next meeting. Go around the Circle and share (1 minute or less per member). Vocalizing it helps hold each other accountable.

Open separate bank accounts for taxes and reserve (if you don't have them), and apply your monthly payment protocol. Come back ready to report on how these actions went.

📅 Wrap-Up · 5 mins

Before you break, plan your next meeting and close on an energetic note. Go around your Circle one by one and finish the sentence:

Now I am feeling… (choose one word).

  • Set the day, time, and location
  • Choose the next topic or resource
  • Confirm who's leading the discussion
  • Decide how you'll stay in touch in between