Freelance to Founder How to Budget When Your Income Fluctuates
Nov 21, 2025
George Azar, a CPA and founder of Bright Budget, provides insightful strategies for freelancers managing fluctuating incomes. He stresses the importance of setting aside 25-30% for taxes and building an emergency reserve of 3-6 months' expenses. George suggests utilizing high-yield savings accounts to combat inflation. He recommends budgeting by percentages rather than fixed amounts and categorizing expenses into life, living, and savings. Finally, he highlights the benefits of maintaining separate bank accounts to streamline financial management.
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Reserve A Percentage For Taxes
- Set aside roughly 25–30% of freelance income into a high-yield savings account for taxes and self-employment tax.
- Use that reserve first to cover the 15.3% self-employment tax and estimated income taxes.
Build A Multi-Month Expense Buffer
- Save three to six months of fixed expenses in a high-yield account as an income buffer when work is irregular.
- George recommends leaning toward six months if your income is highly unpredictable.
Budget By Percentages, Not Fixed Dollars
- Budgeting by percentages (e.g., 10% here, 20% there) matches variable income better than fixed dollar allocations.
- Allocating money as it arrives prevents spending future earnings and under-saving in high months.