Finance dictionary / Zero-based budget

Zero-based budget

A budget where every dollar of income is given a job, so income minus the plan equals zero.

In a zero-based budget, you assign all of your income to something: bills, spending, savings, or debt. If $3,000 comes in, $3,000 is planned, including money for savings.

Zero doesn't mean an empty bank account. It means nothing is left unplanned.