Is your current budget not working out for you? In an article published in The National, Souqalmal team tells you how zero sum budgeting could save you from your budget woes and help you save.

A zero-sum budget is probably nothing like any budget you’ve tried before. It’s a unique concept that requires you to “spend” every dirham you make. But that isn’t a bad thing (in this case), and here’s why.

Every dirham you earn must be assigned a purpose. So, when that salary hits the account, you must plan how to allocate your salary to the various budget categories – household expenses, loan repayments, savings, investments and everything in between. And once you’re done allocating, all income minus all expenses should come down to zero.

Putting the zero-sum budget into practice

In a zero-sum budget, you will have to allocate 100 per cent of your income towards your expense categories. And remember, everything must be treated as an expense, even your loan repayments, savings and investments. (See the simple example pictured below)

Customise the budget as you go

Trying zero-sum budgeting for the first time? Chances are you might not get that ‘zero’ remainder right away. Depending on how you allocate your salary to the various expense categories, you might be left with either an excess or deficit. Here’s what to do in both cases:

For full article go to The National