Wanna know something crazy?

Two-thirds of Americans don’t have a budget.

Meaning that:

218 MILLION people are out there spending their money all will-nilly with no zero game plan.

That’s two hundred and eighteen million people who are not financially successful.

Because, let’s face it:

Without a budget, you are highly, HIGHLY unlikely to be able to afford your lifestyle, pay down debt, or save money.

But wait!  It’s all good, because:

Creating a budget for your money is hella easy. And, when you stick to a budget, you’ll definitely be able to:

  • • pay your bills with ease
  • • finally get out of debt
  • • actually deposit money into that savings account that’s been at $1.67 forever
  • • have extra money for your own personal spending

and, most importantly, your money stress with disappear.

Freaking sweet, right!?

What is a zero based budget?

A zero based budget is the concept of spending and/or allocating 100% of your income each pay cycle.

So, for instance, each time you are paid, you will pay the bills that are due, set aside money for groceries, transportation, etc., and divvy the rest between personal spending, debt repayment, savings, and investing until there is no money left.

Throughout this post, I’ll cover in detail everything you need to know to set up a zero based budget for success!

Here’s a quick overview of what we’ll be covering:

  • 1. Determine Your Why Factor
  • 2. Collect Your Financial Information
  • 3. Calculate Your Income & Expenses
  • 4. Decrease Expenses
  • 5. Setting Up A Zero Based Budget
  • 6. Tracking Your Budget

I’ve also created a downloadable checklist and a monthly budgeting template for you.  Simply sign up below to download it! 😊

Who Is a Zero based budget good for?


Everybody can benefit from a zero based budget – especially if you really, really like to plan (like me!)

With a zero based budget you will be assigning every dollar you earn to a category, such as expenses, savings, or debt repayment.

Simply put, a zero-based budget will establish a plan for every dollar you earn so you can easily live within your means.

The pros of a zero-based budget include:

  • • Being able to easily eliminate poor spending habits by not allocating money to that category of spending
  • • Always having enough money for bills and other necessities because those categories are covered first
  • • Quickly paying off debt by putting more money into your debt repayment efforts instead of personal spending or savings
  • • Saving money is easier when you intentionally put spare money into a high-interest savings account each pay cycle

There really are no cons to a zero based budget and everybody can use this method of budgeting.

1. Determine your why

Ok so, we’ve already established this:

Every single person needs a budget if they want to be financially successful.

But why.

This answer will be different for everybody.   You can determine your why factor by asking yourself what budgeting will help you achieve in your life.

For example:

You might want to start budgeting to stop living paycheck to paycheck, to free up money to pay off debt, or to save more money.

Knowing your why is essential because it creates meaning for your purpose.  Without it, you’d have no motivation to continue budgeting.

Because let’s be honest:

If you do not have a plan for your money, how are you going to afford your blessed life?

2. collect your financial information

The best part about this step is that it’s super simple and shouldn’t take you much time.

You’re simply going to gather up your financial records, such as:

  • • a months worth of pay stubs from all sources of income
  • • a list of the bills you pay and for how much
  • • a months worth of receipts for variable spending on such things as groceries, transportation, household items, take-out, etc.

Once you have those things we can dive into the budget!

3. Calculate your income and expenses

Even though you will be budgeting your income as you get paid, it is important to calculate your total monthly income and total monthly expenses before you start budgeting.

Here’s why:

If you’re never budgeted before, you probably don’t have a true picture of how much money you earn versus spent.  Thus, you don’t know if you’re living within or beyond your means.


To determine if you need to decrease your expenses before you start budgeting, calculate your income and expenses now.


Your Income:

Using the information you gathered during step two, calculate your total monthly income (after taxes) from all sources.

Monthly Income Template From The Budget Boss Binder™


For the purposes of this post, let’s pretend our total monthly income is $5,000.


Your Expenses:

Next, you’ll want to calculate your total monthly expenses.
For the purposes of most budgets, it’s helpful to break your expenses down into two categories:
  • 1. Fixed Expenses: Bills that you pay monthly, usually for the same amount and on the same date. (Rent/mortgage, utilities, cell phone, credit card minimums, insurance, etc)
  • 2. Variable Expenses:  Costs that vary in price each month and could be decreased or eliminated if needed.  (Groceries, transportation, entertainment, personal spending, etc.)
Monthly Expenses Template From The Budget Boss Binder™
If you aren’t sure what your monthly variable expenses are, begin tracking your spending in a budget binder to calculate an average at the end of the month.


For the purposes of this post, let’s pretend our total monthly expenses are $3,500.


Financial Evaluation:

Now that you have you total monthly income and total monthly expenses calculated, you can do some simple math to see if you’re living within or beyond your means.

Simply take your total monthly expenses and subtract that number from your total monthly income.

For example:

$5,000 (total income) – $3,500 (total expenses) = $1,500

Financial Evaluation From The Budget Boss Binder™


If the number is a positive number, you’re in the green.

You should be able to afford your lifestyle with ease each month.  If you’re scratching your head right now wondering where all your extra cash has been going, then starting a budget is the best thing you can do for your finances.

If the number you calculated is a negative number, you’re in the red.

You cannot afford your current lifestyle and are spending more money than you earn.  Decreasing your expenses will be key to starting a successful budget.

But wait:

Everybody can benefit from decreasing their expenses, so don’t skip the next step even if you’re in the green!

4. Decrease your expenses


I know what folks in the green are wondering, “why should I decrease my expenses if I’m making more than I’m spending?”

Well, more money in your pocket is always, unanimously a good idea, right?

Decreasing your expenses will make sure that you’re not wasting money on stupid stuff and will free up money for the good stuff.  The important stuff. (Like vacations, duh!)
To decrease your expenses, follow these 3 steps:
  • 1.  Take out your list of expenses and mark each one with a star that you think you could eliminate or decrease.
  • For instance, could you find a company that offers internet at a lower cost?  Are you overpaying for car insurance?  Maybe you could refinance your mortgage or student loans for lower interest rates. Could you carpool and decrease your transportation costs?  Are you spending waaayy too much money on coffee at Starbucks each month?
  • You get the point!  Do the research and you’ll be ah-freaking-mazed at how much money you could be saving.
  • 2.  Sign Up For Truebill
  • When you sign up for Truebill, they’ll securely connect to your bank account(s) to analyze your spending, subscriptions, and recurring bill pay.  Then, Truebill will work its magic by helping you cancel unused subscriptions, negotiate lower bill prices, and improve your credit score.  In the last five years alone, Truebill has helped its users save over ONE HUNDRED MILLION DOLLARS!
  • You can sign up for Truebill here and be saving money in minutes!
  • 3.  Pay Off Your Debt
  • Credit card debt, car loans, and student loans will suck you dry every month if you don’t work hard now to pay off what you owe.  My two best recommendations for paying off debt quickly are to consolidate your debt into a low-interest personal loan or use the debt snowball method to pay off your debt.
  • Doing this will save you hundreds – if not thousands – of dollars over the course of your life.
Now, I’m gonna be real:
If you only do one thing after reading this post, let it be to decrease your expenses.
It is by far the simplest thing you can do to free up extra money in your life.

5. How To Set up a zero based budget

You made it! We are finally ready to budget!

Grab these supplies to set up your zero based budget:

To  get started, take a peek at the example template below to get an idea of how to set yours up.

Then I’ll go over what you’re looking at in more detail.

Zero Based Budget Template


These are the steps to follow to fill out your monthly zero based budget template:

  • 1.  List your monthly income and total in section 1
  • 2.  List your fixed expenses and monthly total in section 2
  • 3.  List your variable expenses and monthly total in section 3
  • 4.  Subtract your fixed expenses and variable expenses from your monthly income to see how much money you have left to budget
  • 5.  Assign your remaining money to debt repayment, savings, investing, etc. in  section 4
  • 6.  Subtract steps 2-4 from step 1 to get ZERO.  If you do not get zero, you overspent in a category and need to adjust.

Remember:  The goal is use your monthly income until it is gone.  This does not mean, though, that you have spent your money irresponsibly and are now broke.

A  zero based budget means that you have smartly assigned all your money to categories to ensure you have enough for your bills and other necessities and can pay off debt quickly.

You can also adjust your zero based budget each month to align with your current financial goals or variation in income.

Don’t forget:

Download your zero based budget checklist and template that you can use month after month!

6. tracking your budget

Here’s the deal:

Most people forget the most important part of budgeting and then wonder why their budget failed a month after implementing it.

Tracking your budget is the most important part of budgeting.  If you have a budget, then you need to track it.

Because let’s be real:

If you do not track your budget, you cannot make sure that you are sticking to your budget.  And if you aren’t making sure that you’re sticking to your budget, your budget will fail.


Monthly Tracking Templates From The Budget Boss Binder™

Let’s look as a real-life example:

You’ve just set up your zero based budget for the month and therefore should have enough money in your fixed expenses account for all of your monthly bills.

BUT, you forgot that this month your car insurance premium needs to be renewed and you’ll owe $100 more than usual.

Then, since you haven’t been tracking your budget, you do not realize this and your bank account is over-drafted.

Ugh!  Not good!

And, here’s the kicker:

If you were tracking your budget, you would have caught this budgeting error in advance, transferred $100 from savings into your fixed expenses account to cover the difference and never overdrafted your account.

So, you might be wondering:  How do you track your budget?!

We developed the Budget Boss Binder™  to track any and all budgets, debt repayment, savings goals, bill payments, and more.

The Budget Boss Binder™ is a printable and digital budgeting planner designed to help you stick to your budget, pay off debt, save money, and create an abundant life.  The templates included are un-dated so you only have to purchase once to use this them forever.

Because you’re a valued reader of Who Says What, we’re offering our best selling Budget Boss Binder™ to you for 50% off when you click the button below!

Skip to the end? READ ME!

Ok, so I know this was a loonngg post.  So I get it if you skipped to the end.

I’m gonna be honest with you though:

You cannot set up a successful budget by skimming this post.  There’s just too many little details that you’d miss.

But, I will throw you a bone:

When you sign up for our free mini Budget Boss™ eCourse, you’ll receive a paced version of this post over the course of 5 days.  You’ll also unlock access to our free resource library which contains the 50/30/20 budgeting method checklist and template!

I will walk you through each step with mini homework assignments so that setting up a budget isn’t so overwhelming.

Simply use the form below to register for your free Budget Boss™ eCoursetoday!

Creating a budget was the best thing that ever happened to my finances.

It helped me to stop living paycheck to paycheck, pay off thousands of dollars in debt, and explode my savings account.

I want these same things to be true for you, so: 


Gather your financial information, implement your zero based budget, and track your budget for success!