If you need better control over your money, a zero-based budget might be a good option to try. It’s different from the traditional “set it and forget it” approach. With zero-based, you have to assign a specific ‘job’ to every dollar, and you start from scratch each month. It may sound complicated, but zero-based budgeting is actually pretty simple once you get the hang of it. And it can be a very effective way to take control of your finances.

What is a zero-based budget?

A zero-based budget is a budgeting strategy where you give every single dollar a job, leaving zero dollars unaccounted for. So you’ll assign all of your income each month to specific categories, such as rent, groceries, entertainment, and savings. The goal is to make sure that your expenses don’t exceed your income and that you’re making intentional choices with your money.

The benefits of zero-based budgeting

  • It helps you take control of your finances: With a zero-based budget, you’re in charge of where every dollar of your money goes. You’ll be more intentional with your spending, which helps you prevent overspending.
  • It helps you save money: By giving every dollar a job, you’ll be able to see where you can cut back and save more money.
  • It helps you prepare for unexpected expenses: When you have a zero-based budget, you’ll have a better idea of where your money is going, which means you’ll know exactly where you can pull money from to help cover unexpected expenses.

How to do a zero-based budget

  • Determine your income: Figure out how much money you have coming in each month.
  • List your expenses: Make a list of all your regular expenses, such as rent, utilities, groceries, and transportation.
  • Assign each dollar a job: Start with your income and allocate it to each expense category until you’ve allocated all of your income.
  • Review your budget regularly: It’s essential to review your budget regularly to make sure that you’re staying on track and making progress towards your financial goals (with the Brigit app, you can check what categories you’re spending in)
  • Adjust as needed: If you consistently overspend in a particular category, you may need to adjust your budget.