See Also: How to Make a Budget for an Irregular Income Simply use your last paycheck as the basis for that month’s earnings. Don’t pull a number out of thin air either. If you don’t have enough saved to make this happen, don’t panic. It is also going to help you break the cycle of living paycheck to paycheck. This is by far the most accurate way to budget. Rather than estimate your future earnings, try using actual earnings instead!Įventually, you want to get far enough ahead that you can use last month’s income to pay this month’s bills. However, you want your numbers to be as exact as possible. If you’re like most people, your income varies slightly from month to month. Here is the simple formula you’ll use to balance your new monthly budget:Įasy peasy, right? OK, let’s get started. You are in charge of your money, not the other way around. You are going give each and every dollar a job, tell it where to go, and take control of your financial life. You’re not guessing that you’re gonna save about $200 this month.

If you take care of your pennies, you’ll never have to worry about your dollars again! Your income and your expenses should balance to the penny!īudgeting is about details.

This is extremely important, so don’t forget: You’ll do this on a monthly basis by giving every single dollar that you earn a specific purpose. The goal of a zero-based budgeting is to ensure that your income and expenses are exactly balanced (“zeroed out”). The system you’re about to learn is called a zero-based budget, sometimes referred to as a zero-sum budget.

How to set up you need a budget