7 Things to Do When You Do Not Have a Predictable Income

In Kenya today, more and more people earn their money irregularly. Whether you’re a freelancer, small business owner, content creator, or commission-based salesperson, your monthly income likely fluctuates depending on the business environment.

While this flexibility can be liberating, it also comes with financial stress. Rent, food, school fees, and bills don’t wait for your 'good months'. Managing money without a stable paycheck is possible if you approach it strategically.

Here are practical steps you can take when your income isn’t predictable, to build stability and peace of mind even in uncertain times.

1. Start by Knowing Your Average Monthly Income

When your income varies, the first step is to find your average. Go through your earnings from the past six to twelve months (through M-PESA and bank statements) and calculate the total income you made in that period, and then divide by the number of months.

For instance, if over the last 6 months you earned Ksh480,000 in total, your average monthly income is Ksh80,000.

This gives you a realistic picture of what you usually earn and forms the baseline for your budget. You’ll then know that during low months, you may earn below Ksh80,000, while in high months, you might earn more. Understanding this average helps you make better spending and saving decisions without assuming that every month will be a “good month.”

2. Separate Your Business and Personal Money

This is one of the biggest mistakes people with unpredictable income make — mixing business and personal finances.

If you run a small business or hustle, always have two separate accounts or M-PESA lines: One for business transactions and another for personal expenses.

That way, you can track how much you’re actually earning and how much profit is available to pay yourself. It prevents confusion and helps you plan realistically.

Think of yourself as an employee of your business — pay yourself a consistent “salary” each month based on your average income. This habit builds financial discipline even when cash flow varies.

3. Build a Bare-Minimum Budget

When your income isn’t steady, you can’t rely on a traditional fixed budget. Instead, create a bare-minimum budget — the amount you need to survive and keep essentials running.

List your must-pay expenses: rent or mortgage, utilities (electricity, water, internet), food and household essentials, school fees, and transport. For example, if your bare minimum monthly costs are Ksh45,000, that’s the number you must aim to secure every month first before anything else. Once you know this figure, you can plan how to save enough during good months to cover lean months.

4. Save Aggressively When You Have a Good Month

When money is flowing in, maybe a big client pays, you land a tender, or business picks up, the temptation is to reward yourself immediately. But if your income is irregular, that’s the time to think long-term.

A smart rule is to set aside at least 30–40% of your income during good months. Treat it as a buffer to cover your expenses during slow periods.

After saving, strive to invest in opportunities such as Money Market Fund (MMF) for easy access and interest, and deposit some in a SACCO account if you want to build credit history. This approach smooths out your financial highs and lows, helping you maintain stability year-round.

5. Build an Emergency Fund That Covers 3–6 Months of Expenses

An emergency fund is crucial for anyone, but even more so when your income fluctuates.

If your monthly bare-minimum budget is Ksh45,000, aim to save at least Ksh135,000 to Ksh270,000 as an emergency cushion.

You don’t have to build it overnight. Start with small, consistent contributions, for instance, Ksh5,000 or Ksh10,000 per month, and grow it gradually. This fund helps you cover bills or emergencies without panicking or taking on expensive mobile loans during dry spells.

6. Diversify Your Income Streams

When one source of income dries up, another can sustain you. That’s why multiple income streams are key for people with uncertain earnings.

Look for side gigs or passive income options that complement what you already do. For instance, a graphic designer can sell templates or offer online courses. Even a small additional income, say Ksh5,000 to Ksh10,000 a month, can make a big difference when business slows down.

7. Prioritize Insurance

Many Kenyans with irregular income avoid insurance, assuming it’s only for salaried people. Yet one illness, accident, or hospital visit can wipe out months of savings.

Consider a medical cover or an education fund for your children. Insurance cushions you from unexpected expenses, something especially important when income is uncertain.

Final Thoughts

Having an unpredictable income doesn’t mean you can’t have predictable stability. It simply means you need a different kind of financial strategy, one based on averages, discipline, and planning ahead.

By learning to budget from your lowest income, saving during good times, separating your finances, and building an emergency fund, you can turn uncertainty into opportunity.

Because financial peace doesn’t come from earning the same amount every month, it comes from being prepared when you don’t.