A zero based budget can provide a great many advantages, depending on the situation.
What is most important is that the individual or business considering a zero based budget understands its purpose. It is to be used as a means of leveraging every single dollar available in a monthly budget.
This can be a great way of setting aside funds for investments, or ensuring that you stick to a financial plan.
Below are some of the distinctions of a zero based budget, as it pertains to both individuals and businesses:
A zero based budget can be a great way of ensuring you stay financially disciplined.
By setting aside each and every dollar for an exact purpose, you will be ensuring you don’t waste your money elsewhere on more frivolous pursuits.
Moreover, if you’re looking to invest, a zero based budget is a great way of allocating every dollar towards building your financial future. It can also prove to be very useful in building equity within a home, by paying down a mortgage faster.
The key for any individual making use of a zero based budget is to ensure they plan their spending well in advance.
A business can make excellent use of a zero based budget, particularly if it finds itself in a growth phase.
A zero based budget can help a business use every dollar to create or improve upon its infrastructure. Moreover, marketing campaigns, recruitment efforts, and even a workplace culture, can all thrive from the clever use of a zero based budgeting scheme.
The key for a business in making use of a zero based budget, is to allocate every dollar possible towards funding its primary needs.