The first order of business: determine how much money you make each month by figuring out how many paychecks you receive and how much you'll earn post-tax. After you determine your earnings, start planning what you'll spend. Here's the key: don't calculate what you'll spend this month—allocate this month's money for what you'll need next month. List out all of your fixed bills, including rent payments, utility estimates, and groceries. Don't forget to include smaller expenditures such as gym fees or larger bills like student loan payments. Then, it's time to compare and contrast. Once you deduct your bills from your earnings, you can allocate the leftover funds for miscellaneous categories, such as an emergency fund and a long-term savings fund, a vacation fund, and money for fun things such as dining out and going to the movies.

What if nothing is left? If you don't have any disposable income after paying your bills, you need to revisit your spending strategy. Do you really need that fancy cable package? Could you save money on gas by carpooling with friends? You see where we're going with this. You should also prepare to fail when starting out—it's an important part of the process. Once you see where you're overspending, you can adjust your budget accordingly. Now you know! Learn more about The zero-sum budget and other saving tactics in the videos below.