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Saving for Retirement When Your Income is Inconsistent

Updated: Jun 5

It’s much easier to plan your budget, savings, and retirement when your income is consistent.

Being paid on commission or owning your own business, can be significantly more challenging

to save regularly for your retirement. Strategies that work for most might not apply when you’re

working for yourself.


Try these strategies to build your retirement savings even if your income changes from day

to day:


1. Start slowly if you like, but get started. Many Real Estate Agents falsely think that it’s a waste of time to save small amounts of money. Even if you can only save $10 each month, it’s a start. Attempt to add to that amount each month.

  • Getting into the habit of saving money is the most important first step.

2. Create your own version of direct deposit. One great thing about working for a large

company is direct deposit, because it’s easy to send part of your paycheck off to a savings or

brokerage account before you ever see the money. As a Real Estate Agent, you can create a

similar system.

  • Set up your checking account to automatically transfer a specific amount to a savings account at regular intervals.

  • Many individuals leave the money in their checking account while attempting to use mental accounting and tell themselves, “This $150 is for savings.” This rarely works.

Remember that you can cancel a payment if you’re unable to swing it one month.


3. Save more when you can. Real Estate is a cyclical business. When business has been slow for

a while and then it picks up, it’s natural to want to enjoy your newfound bounty. Avoid falling

into this trap. More tough times could be coming. When things are going well, save as much of

that extra commission as possible.


4. Eliminate unnecessary expenses. This is a good rule for everyone. Even if you’re earning $1

million per year, it’s foolish to waste money on unnecessary items and services. For most Real

Estate Agents, it’s wise to consider cutting out anything you don’t truly need.

  • Once your retirement is funded, you can go crazy and enjoy your wealth.

Building a retirement fund sounds great, but without a good budget, you’ll find that most often,

there’s nothing to save.



Learn how to create a budget, even with inconsistent income:


1. Look at the past. Look back at your bills and expenses for the past year. Now consider your

monthly income. It makes sense to attempt to build a budget with your lowest month of

income as a starting point. After all, if you can survive your lowest month of income, the rest

of the months will be easy!

  • You can also average your monthly income from the last year. However, an obstacle may arise if your income is lower than expected for several months in a row.

2. Create an emergency account. The best way to be prepared for low income months or an

unforeseen expense is to have an emergency savings account. Once you fall into the trap of

avoiding the electric bill to pay for groceries, it’s challenging to dig your way out.


Get started immediately on your budgeting and savings plan. Being self-employed, there’s no time

to waste. If money is tight, these may be challenging activities. But when you put the proper

foundation in place, you’ll greatly increase the likelihood of experiencing an abundant retirement.


Personal Tip: When I was a practicing Agent/Broker I would routinely split my commission

checks as follows:

Tithe 10%

Taxes 25%

Savings 10%

Everything else 55% (vacation, stocks, other investments, etc)


It was a blessing that my husband had a fixed salary, thereby allowing us to do the above without

much issue.

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