How to Find Money with a Zero-Based Budget
What if we told you the zero-based budget can help you find extra money the very first month you give it a try? Sound too good to be true?
It’s not. Here’s why: The zero-based budget accounts for every dollar.
Every single dollar you spend is given a category and a purpose before you even spend it. That means you decide up front how you plan to spend your hard-earned cash, and you pay attention to when and what you actually spend it on.
Have you ever stashed $20 in your wallet just in case you need it? One week later, you need it, so you open your wallet for the cash, but it’s gone. You’re pretty sure no one stole it, but you can’t for the life of you remember spending it.
The zero-based budget helps you find money by keeping you from losing it in the first place. And by “losing it,” we mean spending it on careless purchases in stores and online without much thought for your current needs or future plans. Money’s in your account and then it’s gone.
How to Set Up Your Zero-Based Monthly Budget
To get things started, you’ll list any and all income. Think regular paychecks, side work or anything that brings in regular income.
Next, list your expenses. Begin with necessary expenses like your mortgage or rent, transportation costs, clothing, and food. After that, list your fixed expenses like bills, utility bills, and regular monthly payments.
Now pause for a moment to do a little math and add up each list separately. Of course, if you use EverDollar to create your budget, we’ll compute the numbers for you!
Subtract the expenses list from your income. Let’s say your monthly take-home pay equals $3,000 and your necessary and fixed expenses come in at $2,400. You just found $600 to work with!
Of course, the money’s been there all along. It’s just that you, like the rest of us, can easily spend that extra $600 throughout the month without even realizing it.
But now, because you’re paying attention and you have a plan, you can put that $600 to better use. You can tackle debt, add to your savings account, save for a vacation, and so much more! All you have to do is build the your findings into the budget.
Don’t Just Take Our Word for It
Glen L., an EveryDollar user, describes the power of a zero-based budget this way:
“I paid off almost $5,000 in debt in a little over a month. Before the budget I didn’t know where all the money went, and now I don’t know where it all comes from.”