You'll Be Happy You Were Money Smart

After Google’s recent algorithm changes, income from at least one of my sites dropped a lot than I could have predicted. Unfortunately, I didn’t see the change coming. It made me a lot more thankful of the famine/feast budgeting method I use. Whenever I have great income months, I don’t spend the extra money, though I’m often tempted to. Instead, I put the extra in a savings account that I can spend from during months when my income is low.

I also had to dip into my emergency fund last month. (Really just the same account as before, part of the funds are allocated for emergency. The other part is my income buffer.) I remember a time when I didn’t have an emergency fund, when I had to ask my parents for money whenever something happened. It feels good to be able to cover myself in these situations.

Making the Necessary Sacrifice

Being money smart isn’t exactly fun. I probably don’t have to tell you how hard it is to say “no” to things you want right now for a goal that’s far off in the future. I love shoes. I’d be in shoe heaven if I could buy several pair of shoes every month. Thankfully, I realize that’s not a smart way to use my money. Otherwise, when an emergency came up, I’d have to figure out how to turn those shoes into cash. I’m glad I made the sacrifice.

The Importance of Preparation

When you are your own boss, you have to prepare for the unexpected. That means putting money aside for emergencies and for income shortages. You’ll appreciate it when you need to have $1,500 of maintenance work done on your car. It means having the right types of insurance and having insurance deductibles set aside. Know what is and is not covered under your insurance policies – at least the major things. Never take your clients for granted and never let one client dominate your income stream.

Get Started

The sacrifice pays off. If you’ve been hesitant to save money, you can start low around $25 to $100, and increase your savings amount every few months. Or, you can deposit a lump sum into the account, as much as you can afford. That will give you a good beginning boost.

No one wants bad things to happen, but you’ll be happy for the money if something ever does.


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LaToya Irby is a full-time freelance writer and a graduate of the University of Alabama. She primarily writes about personal finance, freelancing, and other self-employment topics.

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