The Zero Move

If you’ve ever found yourself struggling with a traditional budget, zero-based budgeting could be the answer. This method of spending and saving requires lots of foresight and planning, so it could help you get a better handle on your finances. Here is everything you need to know about zero-based budgeting.

The Basics

Zero-based budgeting is a method of controlling your finances by accounting for every single dollar. If you use this method, you assign a “job” for every dollar. Unlike a traditional budget, in which at the end of the month you have a certain amount of excess money, every dollar in a zero-based budget is accounted for.

How Can it Help?

As US News reports, a zero-based budget is a good strategy if you’ve been struggling with a traditional budget. If you find yourself wondering where all your money went at the end of each month, this budgeting method could help. That’s because every dollar has a job, so there’s no uncertainty.

The Good 

A zero-based budget is great for those that don’t mind planning. When you create a zero-based budget, you need to account for every single spending opportunity. That means creating many, many categories and then assigning dollars to them.

The Bad

The downside of a zero-based budget is basically the same as its upside: Lots and lots of planning. When you have to assign a job for every dollar you make, it can get exhausting. For this reason, you could always try the zero-based approach once and see how it goes. If it doesn’t help, you can go back to a traditional budget.