How To Get Control of Your Money Even If You Don’t Have a Regular Income, According to Ramit Sethi
Written by
Cara Danielle Brown
Edited by
Zuri Anderson
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If you’re an independent contractor or gig worker, you know the struggle that comes with having inconsistent income. One month you can afford a Chanel purse while the next you struggle to pay rent.
But just because you don’t have a regular income doesn’t mean you should feel financially out of control.
According to a recent TikTok posted by author and entrepreneur, Ramit Sethi, there’s a simple way to simulate a stable and consistent income — even if you don’t actually have one.
Sethi’s Approach
First, Sethi suggests you figure out the bare minimum amount of money you need to get by each month. This includes rent, groceries, cell phone bills and any other necessary expenses. (He offers $1,000 as an example just for the sake of simple math).
Whenever you make above what you need each month, put that money in a reserve account. So, for the sake of argument, whenever you make over $1,000, place the excess in a separate bank account. If, however, you make less than what you need (under $1,000), take money out of your reserve account for necessary expenses.
“Over the course of a little while, you want to save up roughly six months of reserve,” stated Sethi. “So, you would have $6,000 in that reserve account.”
And that right there is your emergency fund.
Do Others Find Sethi’s Approach Viable?
They do. CEO and co-founder at SecureSave, Devin Miller, stated Sethi’s approach makes sense “because it forces clarity by knowing your baseline expenses and by earmarking separate funds for true emergencies.”
His company’s research shows that most financial shocks are under $500, “so even small, automated deposits into a dedicated account can break the cycle of financial stress and help you build toward that six-month cushion.”
Linda Jensen, wealth management expert for individuals and business owners at Heart Financial Group, also agreed that Sethi’s approach is both practical and psychologically effective.
“This method creates structure around uncertainty,” stated Jensen. And that’s something all gig workers can get behind.
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