How to budget on a roller-coaster income

Freelancers, the self-employed, and those who depend on tips or commissions can have a great-paying month or a bad one, and that leaves them vulnerable.

Here are three tips for managing money when your paycheck fluctuates.

1. Build an emergency fund

People with sporadic income should save nine months’ worth of expenses in an emergency fund , says Todd Youngdahl, managing partner at Washington Wealth Advisors in Falls Church, Va.

One program to help jump-start a savings habit is Saverlife.org. Earn $10 each month that you save at least $20, for up to six months.

2. Budget what you spend

“When you have irregular income, you must live below your means,” says Mark Kemp, a certified financial planner in Harleysville, Pa.

Add up the costs of your necessities, including housing, utilities, food, insurance and transportation, and include a monthly amount for annual bills, such as property taxes. Don’t include extras like restaurant meals or taxi rides.

3. Create a steady paycheck

Take control of your cash flow by setting up separate accounts for deposits and spending.

Deposit paychecks into one account. Each month, use it to pay yourself a “salary” that covers expenses. — Nerdwallet