What is a ‘zero-sum budget’?

What is a ‘zero-sum budget’?

“Zero-sum budget’ involves the calculation of your earnings before making allocations for various other heads. Secondly, you allocate your expenses according to the amount required for each allocation. It aims to account for all the money that you wish to allocate for your expenses.

This concept of budgeting does not allow you to overspend on unnecessary expenses or make over-allocations on any particular head. This is a tailor-made concept and you can add or reduce the budget categories according to requirement.

It is an endless flexible strategy as you can adjust your budget categories ahead of time. This method ensures spending a portion of your income on your saving goals or debts at an early stage to avoid misallocations at the end.

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