By Jan Lindsey

There was a time in my life when I was burned out on my job as a reporter. It was ugly. I had gotten to the point where if at least six people had not died in the car wreck, I figured it warranted no more than a “brief” in the newspaper. For six or more, I was willing to write a story. Ridiculous, of course. But, again, I was burned out.

So I quit with nowhere to go.

In this market, such a move would be sheer folly, but at the time, jobs were plentiful.

I didn’t want to go right back to the newspaper business so I ventured forth figuring I’d do whatever I needed to until I figured out my next career move. I billed it to friends as “my great adventure.”

I ended up working as an office temp, a clerk in a home health agency, a call-taker for an answering service and an order-taker for a catalogue company. I’ve probably forgotten something, but you get the idea. I was all over the map – literally – and living off take-out fast food that I wolfed down between jobs. I worked from 9 a.m. to midnight, moving from one job to another as the day progressed. 

I took the first job and then added a second, and then a third. I found three was about all I could manage at once, so if I found something that paid better than my lowest-paid position I took it and dropped the one with the lowest pay. By the time I found the fourth job, I had proved my self at the two I was going to keep and negotiated with those employers to change my schedule around to accommodate the newest employer. Luckily, they needed me and were willing to play.

Anyway, by the time it was over three years later and I again settled into a professional position, I was working 72 hours a week and collecting income from three employers at a time – all on different pay schedules.

Some weeks I took in more than I needed and some weeks less and I was having trouble managing the household expenses.

At some point, it occurred to me that I had to deal with it like I was playing the bagpipes. A piper blows air into the bag on his pipes at a regular pace, but the notes his fingers call from the instrument erupt at an irregular pace.

I needed to do the same thing with my money: Let the cash flow in at its own pace and the expenses go out as needed. The key was not worrying about the relationship between the two.

So I added up my monthly expenses and divided by two, and I set up a savings account. Then I set up my own pay day and started using the savings account to “pay” myself every other week, just as if I was on a standard payroll somewhere.

Every time I got paid, the money went into the savings account. Every other Friday – I could have done this every Friday, but I had been paid every other week for years and was accustomed to that pattern – I moved two weeks worth of expense money to a checking account and used it to pay bills.

Divorcing the inflow from the outflow was key.

I could look at the balance of the savings account and know exactly how many weeks worth of bill money I had left. If it looked like there was going to be trouble, I would try to slip in a few extra hours on one of my jobs.

It wasn’t the most entertaining period of my life, but once I got the cash flow thing worked out, it fell into a rhythm and got much easier.

None of my creditors ever knew anything was going on because I never missed a payment.

If you are trying to cobble together an income in this down economy and cash flow has become a problem, it may be worth your while to learn to play the financial bagpipes.

In the end, I was proud of myself. 
 

By Jan Lindsey

Assuming you make enough money to cover your expenses, you probably have got the monthly bills down to a science.  The invoices come in, the payments go out.  Done and done.

But if you’re like most people, you still trip over the intermittent bills – things such as car insurance payments, vet bills and holiday presents that at most come due a couple of times a year and always seem to strain the budget.  I found a solution to this a couple of years ago.

The problem wasn’t income -- I made enough money to pay my bills. The problem was cash flow – it wasn’t always there when I needed it.  Sometimes, that sent me reaching for the credit cards.  Never good.  So here’s what I did.  I made a list of everything that I pay that is not a routine monthly expense.  For me, it was:

Christmas and birthday gifts, including any estimated shipping costs

Vacation expenses, including boarding costs for the dog

Annual veterinarian checkups and shots for the pets, plus 50 percent for emergencies

Dog grooming expenses

Pet medication expenses

Car insurance

Wholesale grocery club annual dues

Driver’s license and car tag renewals

Birthday, anniversary and holiday meals ($100 set aside for each date to cover additional groceries

    or a lion’s share of any restaurant bill)

I totaled it up and divided by 12 to get a price per month over the course of a year. Then I began putting that amount into a special, separate savings account each month. This is sacred money. It can’t be used for anything other than a bill on the list.  When the car insurance comes due, I just pull the amount I need from the special account and pay what I owe. No muss, no fuss.

Handling your money like this is a lot like playing the bagpipes: the notes don’t come out at the same rate the air goes in, but the notes always emerge and you never run out of air.  I redo the list every year to make sure nothing has changed. (If the dog dies, I’ll cry, but I will longer need money for grooming and boarding, for example.)

Your list of expenses may be different, and you should take your time drafting it. It may be helpful to go back a year in your check register or take a look at old credit card statements to find these expenses and see how much each item costs. Round up or down to allow for any expected changes. 

In my case, the list totaled about $8,000 a year. That meant a monthly payment of more than $650 a month. My first reaction was that that was an awful lot of money to take out of circulation every month.  But then I thought. If I couldn’t set aside $650 a month, how was I going to pay car insurance in the same month I was going on vacation? All of a sudden putting cash into an account each month seemed like the lesser of two evils. It soaked up some spending money and some slush money -- but it eliminated the panic.