Booa:
I wish I could rec that post 100 times!!! I am self-employed too, and my mantra is taxes, taxes, taxes...it's so easy just to live off cash flow and forget that you NEED to have a hefty e-fund and you NEED to pay the taxes first before anything else. I usually overpay my tax, bcause I am totally afraid of penalties.

I got busy this spring and got late billing my clients. Plus there was that pesky quarterly tax payment in April and June. Luckily I had my e-fund, which I was able to live on for 3 months while I had no income coming in. I've billed my clients now (bad consultant, bad consultant...) and my first priority when the $ comes in is to re-fill the e-fund AND bump it up another $5K as a sort of penalty to myself for getting lazy enough to live off it when I didn't have to. Sort of self-paid-interest on my loan to myself. That's the only way I can force myself not to use it as day-to-day living fund. I have to really beat myself over the head to remind me that it is NOT for bills. It is NOT for investment opportunities. It is NOT for travel. It is for emergencies and periods of no income.

I think whatever budget the OP puts together MUST account for taxes - past and future. And it MUST account for what she is going to do when the IO loan adjusts. Where is that money going to come from? I see a lot about getting out of old debt, but not much about assessing future needs. To me that's critical. lastly, it MUST have excess $ diverted to the e-fund. Any self-employed person knows that is not optional.

Phew...that all sounds like a rant. I love being self-employed, but if I think about it too closely I get a little freaked out. The only way I can deal with it is to save like a maniac.