The zero-based budget is income minus expenses will equal zero for which ever duration works for you. Weekly or monthly are good options for duration to consistently track a personal budget and be prepared for bills as they occur.
Start by gathering all your credit card statements and bank accounts to track expenses. Review multiple statements looking for your bills and when they are due. Understanding each statement and when you are expected to pay things will allow you to try to avoid fees.
Income
This includes any type of income from tips, weekly checks and any side hustles.
Expenses
Savings
Planning for any saving goals from 5% or 20%. Understanding the amount of money put aside each month towards retirement, a home fund, emergency fund, or any other major purchases.
Home Bills
Any bill that is necessary for you to live, focusing on a roof over your head and food. Finding out the amount of income that goes to bills each month creates an easier job to track of the money spent. Categorize each bill into needs and wants to allow you to know what bills are flexible for your life and what’s not.
Holiday Expenses
Holidays, trips, and gifts can become expensive, so becoming prepared for it can help lower stress during those times. For example, setting a hundred dollars aside a month for gifts. While you are waiting for the time to spend this money put in investments or saving accounts, anything to gain interest, but don’t let your extra money do nothing.
Entertainment
Find out the percentage of income that is spent on fun activities that includes any sports leagues, entertainment, going out to eat, ect…
Debt
Pay off debt.
At the end of the month or week any extra money put towards your goals for retirement, savings, ect… Let the extra money you have work for you, don’t let your money not gain interest. The point of the zero-based budget is to start each duration of your budget at zero.