Most budgeting methods suck. This one doesn't.
🔸 Second Trump assassination attempt fails 🔸 Teen arrested for London cyber-attack 🔸 Australia plans to ban children from social media 🔸
Your 2-minute guide to demystifying money and making you richer
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Why we’re breaking up with the 50/30/20 rule
Budgeting is something we all want to be good at, but actually doing it every week is more likely to inspire us to beat our head into a brick wall than it is to break out a cute little bullet journal and track all of our expenses. That was 50p for a pack of gum, yay!
The truth is that budgeting often feels restrictive, and no one wants to voluntarily step into a straight jacket every week if they can avoid it. But we desperately need to budget. More than half of UK consumers have been forced to cut non-essential spending this year.
But we don’t just need a budget so we can say we have one — we need one we can stick to. That’s why Moneyin2 went on a search for one that actually works.
Zero-based budgeting was the clear winner.
First, why the old rules don’t work
Decades ago, U.S. Senator Elizabeth Warren suggested that everyone split their budgets into three neat categories: 50% for needs, 30% for wants, and 20% for savings. Known as the “50/30/20 rule” this budgeting method quickly became THE budgeting method.
It worked like this: If you’re bringing in £2000 a month (the average UK household income hovers around £2917), the 50/30/20 rule says £1000 should go towards needs, £600 to wants, and £400 to savings. Yes, the maths is simple enough, but £1000 for needs is laughable since that won’t even cover rent. And saving £400 every month? Certainly a nice dream, but it’s not reality.
Anyone who ever tried this budgeting method quickly realised that it doesn’t hold up in today’s world of unpredictable incomes and soaring costs.
Enter: zero-based budgeting
Here’s how it works: with zero-based budgeting, every single pound you earn is given a specific role. By the end of the month, your income minus your expenses equals zero — not because you’ve blown all your cash, but because you’ve assigned every penny to a purpose. Think of it like putting together a puzzle, where each piece locks into place.
We’ve heard from several members of the Moneyin2 community who say this method works best for their detail-oriented brains. That’s because it actually forces you to spot wasteful spending and work towards making real progress toward your financial goals. No more wondering where your money went— this system shows you exactly how you’re using your dollars, and where you can trim the fat.
How to make zero-based budgeting work for you
Here are some ready-made spreadsheets we love. This one’s Excel, and this one’s Google Sheets. You’ll start by calculating your total income for the month — whether it’s from your job, side hustles, or investments. Then, list every expense you can think of: rent, groceries, utilities, entertainment, even those unpredictable costs like car repairs or medical bills. The more detailed, the better.
Then comes the magic: assign every pound to a category. Prioritise your essentials while still setting aside money for emergencies, savings, debt, and fun.. As you go through the month, you can adjust as needed — because life happens, and the goal here is always that your budget should be flexible enough to roll with the punches.
Why are we so passionate about this?
Unlike old-school, numbers-driven budgeting, zero-based budgeting is actually about mindset. It’s about being intentional and fully aware of where your money is going. It encourages you to form healthy financial habits (like regular budget reviews and proactive saving) that keep you on track for your bigger financial goals, like retirement.
And the best part? It’s adaptable. Whether you’re working with £5000 or £50, zero-based budgeting helps you make the most of what you’ve got. If you still need convincing, here’s another cheat sheet on how to create the perfect zero-based budget for you.
And for dessert …
A second Trump assassination attempt has failed in the US. The attempt by a 58-year-old registered democrat happened on Trump’s golf course in Florida.
Jamie Oliver's daughter could be 'deemed unprofessional' over graphic post about her job as a nurse. The 21-year-old shared a little too much about her life on the wards.
The hackers just keep getting younger. A 17-year-old has been arrested by the National Crime Agency as part of the investigation into the Transport for London cyber security incident.
Australia plans to ban children from social media until they’re somewhere between 14 and 16 years of age. The ban could go into effect as early as this year. Critics say checking and enforcing an age block isn’t even possible.
The Moneyin2 Guide to Wealth
The Moneyin2 Guide to Wealth will get you the biggest return on your savings by maximising cash matches from your employer, free cash from the government, and shielding your investment gains from tax. It takes you step-by-step through the world of pensions, SIPPs, ISAs and ETFs — all in plain English.
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