This is how my niece (age 19) organizes her money each month. She uses a similar practice with her roommate. Together they forecast their combined monthly expenses, which vary beyond rent and utilities. Sometimes they share transportation and “throwing-a-party” expenses (because you know... teenagers). My niece spends 3-5 hours per month hammering out these details. She sets up her financial “workbooks” on this whiteboard and a shared paper notebook with her roommate.
If your paycheck is the same amount of money each payday — yes, there are. My niece tried them. She liked reviewing where her money went (tracking past spending). She even built a budget per the tools’ recommendations. So why is this whiteboard still her go-to?
Because it’s what she can't see right now that can make or break her month.
If she gets sick her paycheck suffers. She only gets paid for what she works. When that happens, her plan has to change. But a traditional budget is static. The whole point is to stick to it. Which is fine if you are pulling a paycheck that includes paid time off for being sick. When she misses a shift, she has to fill in the blanks. The whiteboard calendar lets her “pencil-in” other gig options. Like picking up hours with Doordash to supplement her full-time daycare gig. Or side hustling baby-sitting on the weekend nights for some quick cash. She uses the whiteboard to map out her options on a calendar. This is so she can pull together the best mix of her time when disaster (or opportunity) strikes. It’s a template she can mark up (and erase) with ease. She can jot down gigs she picks up (or loses), and see the impact on days she cares about in the future.
I get it. I used to do the same thing (paper calendar printouts). And I’ve talked to over a hundred independent workers who also get it. When your income ebbs and flows, budgeting can’t be a set-in-stone plan or spreadsheet that you live-and-die by. That doesn’t mean you don’t need a plan — it means you need one that adapts in real-time to your changing circumstances.
I was chatting with an old colleague and friend (@marlomajor) recently about Balance. He offered great perspective. He said budgets (and budgeting tools), are all static. If you want to make a change, it’s an entire process and burden to “go update your budget.” Doing so is out of touch with today’s reality of when and how we spend. We used to drive (or walk) to a store. Now we click. Click to buy. Click to deliver. Click now and pay later even. So static doesn’t cut it. By the time you update your budget, it’s a sunk cost, and the burden of it all seems rather futile. The more you restrict yourself, the harder it is to maintain. The more you fail to restrict, the more demotivating it all becomes. After all, we’re only human.
Forecasting lets you flex. The focus is on looking forward, running scenarios to address any given change in circumstances. Blew your budget for meals & entertainment? Fine, forecast opportunities to make it up. This is why forecasting is so critical to the independent worker. Aside from the choices they have to make in spending — they also have to make choices in earning. An independent worker’s situation requires a dynamic solution that allows them to adjust both of those levers.
At a high level, there are two broad categories of independent workers. On one end of the spectrum, you have your shift & appointment based crew. Think nail techs, bartenders, restaurant servers, ride share drivers, and barbers to name a few. On the other end of the spectrum you have project-based independent workers. Think trade freelancers (graphic designers or copywriters for example), film & TV production teams, and consultants. The shift & appointment based workers operate on a high-volume/low-cost set of transactions to earn income. The project based group operates on a low-volume/high-cost set of transactions (projects) to earn income.
If your livelihood depends on a changing income, typically in the form of shifts, appointments, tips, side-hustles, etc... I’d love to learn more about you. You can reach me directly at hello@balance.cash. Drop me a line and let’s build out the next version of Balance that will help you the most.
