How to manage a lump sum

Who’s it for: Variable Income Earners
What’s it about: The process I use for making sure I’m using a big lump sum as efficiently as possible.
What you get: an infographic breaking down the whole process.


What if there’s not enough money?

The problem with budgeting is that you’re painfully aware when there’s just not enough.

You see… I just got finished with a big month of gigs.

Now those of you that aren’t in opera might be surprised to know that you can make pretty good money in a month … if you’re working.

So in about six weeks over Oct/Nov I made just over $15,000.

Not bad right?

And man did I have plans for that money.

They included:

  • finishing my dental work (5 more crowns to go)
  • funding my winter (it’s a bit slow until March)
  • paying for business coaching (because building a new business is hard)
  • getting some new clothes (I want some new clothes)

On the surface, and by that I mean the quick mental math I did in my head… I had more than enough. I just made $15,000 after all.

But then I looked at the real numbers (and added a few things I was forgetting):

Taxes $3,000
Commission $1,500
Living costs/salary for Oct/Nov $4,000
Business expenses for Oct/Nov $1,000
Finishing dental work $5,000
Funding winter salary $6,000
Business coaching $1,500
New clothes $300

I’m about… $7,300 short.


There just isn’t enough.

Here’s the truth: there’s never enough

In my case, I’m not talking about a base level sustenance ‘enough’. I will eat, I will sleep in a dry place, but I’ve also got a ton of things I want to do.

And there’s never enough for all of them… especially for artists with businesses and people who want to have teeth that don’t suck.

15,000 dollars may seem like a big chunk of change for one month, but the truth is it can only do so much.

So here are 4 things to do when you feel like you don’t have enough (and you don’t have to have $15,000 for them to work.

4 things to do when you’re managing a lump sum

How to manage a lump sum

1. Prioritize

What’s most important? What needs to happen, and what do I just want to happen?

1. Taxes/Commission – this isn’t my money. I need to pay it.
2. Salary/Business Costs: this money is technically already spent. It’s living on my credit card. It’s an essential part of my life.

And then this is where things got hard.

The ‘correct’ answer is to tell you I’m funding my winter… making sure that my basic needs are covered so that I’m stable.

But I’m not doing that.

This is where personal finance gets so situational. I have some income over the next few months, but not enough to cover all my salary and business costs. But I know that right now… I need a little pressure to find more income. A little instability is exactly the right choice (although ask me if I still feel that way in February).

It’s not the right ‘financial planning’ choice but it’s the right choice for me.

So number three…

3 – Dental work – this is debt. It’s also one of my biggest financial goals for 2016. Regular readers will know all about my dental saga… I can’t wait to close that chapter forever.
4 – Business Coaching – I’ve been working with a coach that helps me through the process of building a business. He’s great… it’s been really valuable and it just the investment I need right now.
5 – New Clothes – I want them. Nothing noble here. All my shirts are ripped.
6 – Fund Winter – Ranking this last gives me guilt pangs. But I’m excited to put my feet to the fire a little bit.



2. Apply Available Cash

Work down your list of priorities and fill them up until you’re out of money.


3. Examine Underfunded Goals

Take a good look at the goals that are underfunded.

Will there be money to cover them? What happens if there isn’t? What’s the worst case scenario? What’s a realistic scenario?

If you want to look at the bigger financial picture you can use THIS SPREADSHEET (even if you’re not an opera singer).


4. Redistribute cash if needed

If the questions in Step 3 got you nervous just redistribute the allotment.

If there really isn’t enough income to cover the things you need, really look at how much you’re falling short and come up with some ideas to cover the difference.

Write down some ideas for making some extra income or maybe take a look at ways you could decrease those costs.

There will never be enough, but making sure you know what goal is next in line means you’ll be constantly feeding the things that you want/need.

There are only two ways to have ‘enough’…

Make more, or change the definition of enough…

No matter what strategy you use, these steps will help.

And I’ll see you at the dentist.

Want to start getting control of your money? How can I help?

Chris Enns

Chris Enns

Financial Planner/Opera Singer

Money never came naturally to me. In fact… I was a bit of a disaster. I remember (very clearly) what it feels like to be ‘financially out of control’.

And honestly, I still get stressed about money… that doesn’t stop… the difference is that now I have the tools to deal with that stress.

And those tools are what’s made it possible for me to build a life full of the things I want: art, creativity, travel, family and more.

If you want to start getting control of your money I’d love to help. You can start with THIS QUIZ, visiting my GETTING STARTED PAGE or by checking out my SERVICES page.