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Zero Sum Budgeting: Do I Really Have to get to Zero?


zero sum budgeting

Today we are going to chat about exactly how close to zero you need to get when you are doing a zero sum budget!  (Please don’t leave, I promise this is not too boring!)  Text is below the video if you prefer to read!




First let’s cover what a zero sum budget is – it is when you start with your income, and then allocate it out to your expenses and savings until there is a nothing left – you are at zero.  You do this so that every dollar that you make has a pre-planned destination.

I know this can seem a bit overwhelming.  Do you really need to get all the way to zero?

My answer depends on which side of zero you are on!

If you are negative, meaning you are spending more than you make – yes you must get to zero!

A balanced budget is crucial to creating wealth. (Click to Tweet)

However, if you get to the end and have a positive number, then I go against the hard core zero sum budgeters and say you don’t have to get to exactly zero.

If you are a few hundred off, please do get them allocated otherwise you are just going to spend them.  It is better that they have a purpose.  Yet if you are within $100, I say don’t stress.

We have too much going on to sit and figure out where to place smaller dollar amounts, especially when you will likely have to make adjustments throughout the month.

One thing I do is put small extra sums into my overflow/emergency fund.  This way you can build your emergency fund and create a cushion.

Now it is action time: Not doing a budget, get started today.  It is the best way to ensure you are living on less and creating a solid financial future.

Not sure how to start that budget?  Check out my ebook on how to do a zero sum budget.