When to use it
Use it when you want full control over where your money goes each month.
How to apply it
- Write down your expected income for the month.
- List every fixed cost and its amount.
- Allocate amounts to variable spending categories.
- Assign the remainder to savings or debt repayment until nothing is unallocated.
- Track spending against each category through the month.
- Build next month's budget from scratch using what you learned.
Tip: Include irregular costs such as birthdays and car servicing so they do not derail the plan.