4 ms·

It's better than nothing, but the OP's simplified budget leaves a lot to be desired and could even be quite dangerous to a freelancer's savings and mental healt

It's better than nothing, but the OP's simplified budget leaves a lot to be desired and could even be quite dangerous to a freelancer's savings and mental health. Spending the previous month's income one month after it hits your bank account sets you up for a roller coaster of feast and famine that is little better than living paycheck to paycheck. There was nothing in the article about saving for the future. A more effective budget would take a rolling average of your last 6-12 months income. Subtract at least 25% of that for savings (if you can save over 50% even better). The remaining money can be pro-rated for a reasonable monthly income. When you have a windfall month (such as early/late paying clients happening to fall on the same week) then put all of that extra money into savings.

andy_adams 12y ago
I agree the budgeting method isn't complete. When I write, I always debate whether to delve into related subjects. I decided to keep it simple here. Don't treat my method as the end-all!
- jf22 12y ago
  This budgeting method is actually really dangerous. I'd take down your blog post and rethink how you budget your money.
  - sanderjd 12y ago
    This is overly harsh. The article may not be the absolute best advice, but it is probably illuminating to people who are already doing a worse job, living month-to-month rather than next-month-to-next-month, and it's completely harmless to people who already have a better system (hint: spend less than last month's income!).
    - nimblegorilla 12y ago
      This article provides the illusion of a real budget. Month-to-month is actually better than last-month-to-month. A person living month-to-month would at least stop spending money if they had a bad month. A person living on last-month's income would continue spending money and go into debt. Freelancers depend on FUTURE income. A "budget" that encourages you to spend all of your money regardless of future income is extremely messed up.
      - andy_adams 12y ago
        > A "budget" that encourages you to spend all of your money regardless of future income This would only be true if you don't think at all about this month. If someone says "I'm making no money this month, but I'm just gonna spend last month anyways" I don't think any budget is going to help them. I appreciate your feedback, I just didn't think anyone would take "living on last month" to mean "spend all of your money, no thinking allowed".
- sanderjd 12y ago
  A better simplified budget might end with something like: 5. Subtract off a reasonable estimate for spending money, 6. Save the rest. Instead of thinking of spending money as unbounded, think of savings as unbounded, and bound everything else.
  - andy_adams 12y ago
    You're right! I should've mentioned savings before spending. Edited the article. Thanks!

andy_adams 12y ago

I agree the budgeting method isn't complete. When I write, I always debate whether to delve into related subjects. I decided to keep it simple here. Don't treat my method as the end-all!

jf22 12y ago
This budgeting method is actually really dangerous. I'd take down your blog post and rethink how you budget your money.
- sanderjd 12y ago
  This is overly harsh. The article may not be the absolute best advice, but it is probably illuminating to people who are already doing a worse job, living month-to-month rather than next-month-to-next-month, and it's completely harmless to people who already have a better system (hint: spend less than last month's income!).
  - nimblegorilla 12y ago
    This article provides the illusion of a real budget. Month-to-month is actually better than last-month-to-month. A person living month-to-month would at least stop spending money if they had a bad month. A person living on last-month's income would continue spending money and go into debt. Freelancers depend on FUTURE income. A "budget" that encourages you to spend all of your money regardless of future income is extremely messed up.
    - andy_adams 12y ago
      > A "budget" that encourages you to spend all of your money regardless of future income This would only be true if you don't think at all about this month. If someone says "I'm making no money this month, but I'm just gonna spend last month anyways" I don't think any budget is going to help them. I appreciate your feedback, I just didn't think anyone would take "living on last month" to mean "spend all of your money, no thinking allowed".
sanderjd 12y ago
A better simplified budget might end with something like: 5. Subtract off a reasonable estimate for spending money, 6. Save the rest. Instead of thinking of spending money as unbounded, think of savings as unbounded, and bound everything else.
- andy_adams 12y ago
  You're right! I should've mentioned savings before spending. Edited the article. Thanks!