https://boards.hellobee.com/ Pregnancy, Baby and Parenting blog, by Hellobee en Mon, 29 Jun 2026 23:47:44 +0000 https://boards.hellobee.com/topic/budgeting-unstable-income#post-2797871 Thu, 18 Jan 2018 08:45:32 +0000 Anagram 2797871@https://boards.hellobee.com/ <p>@Meowkers: coming back to this because "year end" bonuses were announced a couple weeks ago, so we've been in the planning stages. So actually, my answer to your original question is changed because now that we're in the middle of it again, I realize I was remembering a few things wrong re: your questions about 401k and that stuff.</p> <p>So, although my husband's bonus is for 2017, he gets the check in 2018, so what we do is pre-pay a lot of things in 2018. Because he gets the bonus added onto a regular paycheck, he already has some deductions set up that he doesn't change--for example, he has 10% of his paycheck set to go to 401k. So when he gets his 2017 bonus, 10% will be going to his 2018 401k contributions. That means he will max out in a couple of months and the rest of the year he won't be making contributions out of his paycheck. We also have a 529 set up, so we are setting up a big initial payment for 2018 pre-tax, so the tax rate on the rest of his paycheck that month (state taxes, ss, federal tax, etc) is lower. That means that at some point halfway through the year, he'll max out the SS payments and won't have to pay that anymore in each paycheck. </p> <p>With the remainder, we split it into 4 parts--we set aside a chunk to go towards some things we need in the house--a "refresh" of some decorating items, blinds, new light fixtures, we need the whole apartment painted, etc. The 2nd part are new investment funds outside of the existing mutual funds/retirement stuff we have. Basically, we are investing in place of adding to savings, but this is money we will take back out if we decide to upgrade to another house...hopefully we'll make some money in the meantime. The 3rd part is set aside for summer programs for our kids (camps, lessons, etc), and then the 4th part is up for discussion right now. I want to blow it on a big family vacay again, my husband wants to pay for any vacations out of our regular paychecks and add the 4th part to the investments chunk. We'll see, we're negotiating that.</p> <p>whew! Just wanted to come back because originally I said we *don't* pay for 401ks and stuff out of bonus money, but it turns out we actually do, it's just that we're using last years bonus to pay this year's 401k contribution, rather than not contributing in 2017 and then using the bonus at the end of 2017 to back pay 401ks, if that makes sense. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793309 Sat, 23 Dec 2017 13:35:51 +0000 Littlebit7 2793309@https://boards.hellobee.com/ <p>We have the same predicament. My husbands bonus was nearly 150% of his salary. It sounds odd but that's just how it is<br /> We live on his base. Depending on the year, the bonus pays on student loans, gets socked away, pays for any trips we took or earmarked for upcoming known expenses. This year instead of paying off the remainder of loans, we will likely stash away for a house. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793277 Fri, 22 Dec 2017 19:51:46 +0000 birdofafeather 2793277@https://boards.hellobee.com/ <p>@DesertDreams88: yeah, that’s true. You could just add it into your budget for the next year! @meokers: </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793270 Fri, 22 Dec 2017 17:28:03 +0000 DesertDreams88 2793270@https://boards.hellobee.com/ <p>What about stashing it away in a savings account, dividing the total number by 12, and then setting up automatic monthly transfers to your main checking account? That way each month you would get a regular, predictable amount as "income."</p> <p>Or, use that money as year end investments? </p> <p>I think it would definitely depend on your budgeting style and comfort level. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793256 Fri, 22 Dec 2017 14:41:15 +0000 Truth Bombs 2793256@https://boards.hellobee.com/ <p>@Meowkers: in that case I would likely keep doing what you’re doing and pretend it doesn’t exist when budgeting for the year ahead. I would rather have a windfall to figure out than budget based on an expectation and then the company has an unexpected bad year, etc. But I’m really conservative with this stuff. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793255 Fri, 22 Dec 2017 14:37:55 +0000 Meowkers 2793255@https://boards.hellobee.com/ <p>@Truth Bombs: its based on the company's performance and his overall good work. His job doesn't have quantifiable performance so it's all about perception and how much his bosses like him. Hehe. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793254 Fri, 22 Dec 2017 14:36:13 +0000 Meowkers 2793254@https://boards.hellobee.com/ <p>@gingerbebe: thank you for the advice. Our house has one major project that it needs before going on the market and that's repair of a backyard fence and landscaping. The money is there it's just a matter of finding time to get bids and get the work done. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793253 Fri, 22 Dec 2017 14:35:57 +0000 Truth Bombs 2793253@https://boards.hellobee.com/ <p>@Meowkers: is his bonus based more on his performance individually or the performance of the company? Ie How much control does he have on the number? </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793251 Fri, 22 Dec 2017 14:28:02 +0000 Meowkers 2793251@https://boards.hellobee.com/ <p>@birdofafeather: thank you for the advice. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793249 Fri, 22 Dec 2017 14:26:18 +0000 Meowkers 2793249@https://boards.hellobee.com/ <p>@travellingbee: there is no minimum and no contractual guarantee of a bonus but it is the prevailing practice and understanding in the industry. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793247 Fri, 22 Dec 2017 14:16:06 +0000 birdofafeather 2793247@https://boards.hellobee.com/ <p>i'm a photographer and use YNAB to budget. i give myself a salary based on past yearly (as well as what i know i have booked) net income spread throughout the year. DH is a FF and has a base salary as well as a long of opportunity for OT, which is plentiful, but we don't want to necessarily rely on it in years to come. when we bought our house, it was based on his base salary as he didn't have enough years to show OT as part of it. if i were you, i would probably build my budget based on the base salary plus maybe 10% for the year and try to include as many savings goals as part of it, even if it's not the max. then if and when he gets his bonus, max out the rest of savings. i wouldn't want to get to year end and then NOT get the expected bonus and then be up a sh$t creek for our savings goals while knowing i could have cut back on expenses throughout the year to meet them. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793244 Fri, 22 Dec 2017 13:54:58 +0000 gingerbebe 2793244@https://boards.hellobee.com/ <p>DH is a small biz owner so I get it. I would do it the way you are doing it or base the calculations on the lowest bonus amount you’ve ever gotten, if you want to free up more cash month to month. But I would put aside some cash for home improvements if your goal is to move into a bigger home relatively soon. We just sold our first house this summer and moved to our theoretical forever house and we made quite a bit of profit on our home considering the short amount of time we lived in it because we did solid, middle of the road improvements on it as we lived there. No structural changes, but sprucing up. Fixtures, repainting cabinets, interior paint, sinks, etc. we didn’t use the cheapest nor the most expensive stuff, just solid middle of the road things that would appeal to the mainstream. We did all fixes with an eye towards selling because we knew it wasnt our forever home. Our home sold in 4 days and ended up going into a bidding war and went way over asking and way over the comps in our neighborhood because people repeatedly said “because it’s just ready to move right in.” </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793242 Fri, 22 Dec 2017 13:49:04 +0000 travellingbee 2793242@https://boards.hellobee.com/ <p>Is there a minimum amount it could be? Is he guaranteed to get a bonus at all? </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793237 Fri, 22 Dec 2017 13:01:09 +0000 Meowkers 2793237@https://boards.hellobee.com/ <p>@Anagram: it sounds like you do almost exactly what we do with that huge bonus. We don't put any extra towards our house payments because our mortgage interest is so low and we have no plans of being in this house forever. </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793234 Fri, 22 Dec 2017 12:46:04 +0000 Anagram 2793234@https://boards.hellobee.com/ <p>I don't know what's "best" financially speaking, but my husband's year end bonus can be anywhere from 1/3-1/2 his base salary, and it fluctuates and is never guaranteed. We completely live on our combined base salaries, and that includes maxing out 401ks and all that. We've done a variety of things with his bonus the past few years, but usually about half goes into a giant extra payment on our house, about 40% into savings/investments and then last year I convinced my husband to set aside 10% to take us and his parents on vacation. </p> <p>I'm going to try to replicate that formula this year, but with a different vacation, haha.</p> <p>Curious what others do! </p> https://boards.hellobee.com/topic/budgeting-unstable-income#post-2793232 Fri, 22 Dec 2017 12:27:26 +0000 Meowkers 2793232@https://boards.hellobee.com/ <p>Hi Ladies. I'm hoping to get some advice about family budgeting when a large portion of income is unstable. </p> <p>My husband works in an industry where a LARGE portion of his compensation is in the form of a end of year bonus. A few years ago his bonus was 30% of his base salary, this year it was 50%. The bonuses are somewhat expected but ultimately not guaranteed and there is no way to know the amount ahead of time. In the past when we make our "yearly budget" we completely ignored the bonus and treat it as windfall at the end of the year. We use it to max out our 401k, contribute to 529 plan, fund other investments and put the left over into savings (which is then used for large expenses like vacations and home repairs). </p> <p>But I'm wondering if there is a better way to budget for this money since it's such a large portion of our income. We want to buy a bigger house and when we figured out our budget we didn't take any portion of the bonus into account. Should we? Should we defer all investments through the year, including 401k and rely solely on the bonus for that, freeing up more monthly income? Any and all suggestions welcome. </p>