# Zero-Based Budgeting

*Everyday Money — Finicade finance glossary*

Zero-based budgeting assigns every unit of income a job until income minus assignments equals zero. Nothing is left 'unallocated', because unallocated money is the money that disappears. Savings and debt payments are assignments too, so a zero-based budget is not a spent-it-all budget. Compared to percentage rules like 50/30/20 it's higher effort and higher accuracy, which makes it a strong choice for irregular income and a tedious one for people whose spending is already stable.

**Formula:** `Income − Every assigned category = 0`

**Also known as:** zero-sum budget, ZBB, give every dollar a job

**Related terms:** [Budget](https://finicade.com/glossary/budget), [Envelope Budgeting](https://finicade.com/glossary/envelope-budgeting), [The 50/30/20 Rule](https://finicade.com/glossary/50-30-20), [Cash Flow](https://finicade.com/glossary/cash-flow)

Source: https://finicade.com/glossary/zero-based-budgeting