Glossary · Couples finance
Zero-Based Budgeting
/ˈzɪər.oʊ beɪst ˈbʌdʒ.ə.tɪŋ/ · noun
Definition
A budgeting method where every dollar of income is assigned a specific job at the start of each month. Income minus assignments equals zero.
Zero-based budgeting (ZBB) was originally a corporate-finance technique adapted into personal finance by writers like Dave Ramsey and YNAB. The principle: every dollar of after-tax income gets categorized (to spending, saving, or debt) until nothing is unassigned.
ZBB demands high engagement from both partners in a couple, since every dollar of shared income must be assigned and both partners need to agree on the assignments.
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