This is a great way for you to track all the money you make, and all the money you spend.
We like the zero-based budgeting approach, which assigns every dollar a place to go each month.
First, identify all the monthly income you will receive. Then, give each dollar an assignment.
Assigning every dollar a place to go does not mean have to spend every dollar on expenses! If all the regular expenses are accounted for and there is money left over, it can be allocated to discretionary categories like savings, investment, the new car fund, etc. What we hope to see is, over time, you will look for ways to tighten up your budget so you can assign more and more dollars to your savings and investments.
Notice how money in = money out. This is characteristic of a zero-based budget. Every dollar is accounted for!
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