When you first start having to manage your own finances, it can be both exciting and a little scary. The good news is that financial institutions, such as Bank of America, have people on hand to speak to you, and help you decide what sort of banking features you need, to help make the most of your money.

If you need this sort of advice, you just need to find a Bank of America branch and make an appointment to speak to an advisor. The financial advisors at your bank can also help if you have problems with income swings. You may not think this is going to happen to you, but approximately one-third of U.S. households struggle with this issue; so, it’s more common than you think.

Reasons why your income may fluctuate

There are many reasons why you may experience issues with fluctuating income, in your life. These reasons include:

  • Variable income from self-employment.
  • Being laid off from regular employment.
  • Being unable to work due to illness.

These scenarios could happen to anyone. So, a regular income is not something you should take for granted. There are steps you should take, to protect yourself against the issues that wide income swings can cause.

Being aware of how much money you need

You may be fine paying all your bills, and living your life each day; but do you know how much that costs monthly? If you do not know how much you need, it’s not possible to make effective plans for times when your income varies. You need to start by making a note of the money you spend or invest each month. Add up what you spend on:

The total of these amounts is the money that you need to live your life in the usual manner, no matter what income you have coming in.

Making sure you are prepared for an emergency

Emergencies can happen when you least expect them, which is why you need to make sure you are as prepared as possible. At the very least, you need to be able to pay your regular bills, and other day-to-day living costs, such as paying for groceries. It’s a good idea to save enough money to cover these costs for three to six months. Doing so means that you can sustain your way of life if you ever experience income swings, in the short term.

Be prepared to make adjustments

Working out what you spend is not something that should just be done as a one-off exercise. You should keep a record of your expenditure on an ongoing basis, and make changes where necessary. For instance, if you have budgeted too much money for daily living expenses, you may want to re-allocate some of your income to savings. The more money you can save, the more chance you have of being prepared for wide income swings, if they happen.

Managing money is something that we all must do. It’s especially important to ensure that you plan to provide yourself with a financial back-up for times when your income varies greatly. The advice we have provided should help you to do this.

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