What is a Zero-Based Budget? A Guide for Parents and Teens

There are so many temptations as a teen. From buying the latest kicks to getting concert tickets to see their favourite band. It’s not easy for them to figure out how to divvy up their money. As a parent, you want to provide the best financial education for your teens so they make smart money decisions. 

Budgeting is one of the best ways for teens to learn to manage their money responsibly. In particular, zero-based budgeting can be an effective tool to help teens give each dollar a purpose. Use this guide to help teens learn what a zero-based budget is, the pros and cons of using this method, and how your teen can create one.

What is zero-based budgeting (ZBB)? 

A zero-based budget or ZBB (as the cool kids would say), is a method where you allocate every dollar of your income and assign it to either an expense or savings goal. Simply put, you take all your income sources and subtract your expenses and savings, to equal zero.  

It’s a popular tool used in the corporate world but has since been adapted to suit our everyday financial needs. It can be a fun exercise for parents to show their teens how to create a zero-based budget to see where their money flows in and out. What’s more, with a looming recession, it’s a good opportunity to talk to your teens about how to prepare for it using a budget. 

Why use a zero-based budget?

There are a number of reasons teens would use a zero-balanced budget. First, it may help them learn how to stay out of debt, which can be helpful when they are old enough to have a credit card or a student loan. They will also benefit from having a spending plan for the upcoming month and avoiding impulse purchases. 

Read more: How to apply for your first credit card

Plus, it provides the flexibility to modify the budget on a monthly basis based on your goals or needs. For example, in one month your kids may allocate more money towards back-to-school shopping, or another month they’ll want to buy a new outfit to attend a semi-formal.

Lastly, it can be better suited for families whose monthly expenses don’t neatly fit into a 50/30/20 budget—which is where you would allocate 50 per cent towards your needs, 30 per cent for wants and 20 per cent for savings. With the rising cost of living, this formula may no longer serve some Canadian households, which is why the zero-based budget may be a better fit.

Zero-based budgeting vs traditional-based budgeting

There are similarities between the two types of budgets. However, here are some key differences:

Zero-based budgetingTraditional-based budgeting
Encourages you to justify both old and new expensesFocuses on analyzing new expenses
Balancing the calculation to zero Uses the previous budget as a base
More time consuming and complexEasier to implement
Based on a forecastBased on historical information

What are the pros and cons of a zero-based budget?

Based on your financial situation, you may consider weighing the advantages and disadvantages of having a zero-based budget: 


  • It can help you curb impulsive spending since social media makes it easier to spend money online. 
  • It helps ensure you don’t live beyond your means.
  • You can customize it to your wants and needs. 
  • A zero-based budget allows you to make adjustments along the way. 
  • It shows where you’re overspending and gives you the ability to decide where to cut down costs. 
  • It helps motivate teens to work towards their savings goals.


  • It can be time-consuming to maintain a zero-based budget, especially when you’re juggling numerous extracurricular activities and homework.
  • It can be challenging for teens with unpredictable incomes. For instance, your kids are probably working part-time while in school and may not have stable paycheques.
  • You may need to reallocate your funds based on your spending habits.
  • It could be challenging to stick to a zero-based budget if you have unexpected expenses.

How to create a zero-based budget

Ready to give zero-based budgeting a try? Here are the steps you need to take to create a zero-based budget. You can either record this in a notebook or a spreadsheet. 

1. Determine your monthly income

The first step is to make a list of all your sources of income along with the amounts. This may include:

  • A part-time job (e.g. babysitting, working at a store)
  • Tips you receive from customers
  • Weekly allowance
  • Tasks you’ve completed through Mydoh
  • Earning money online (e.g. Youtube channel or gaming)
  • Monetary gifts

It may take awhile when you do this exercise for the first time. Keep in mind, it will get easier each month as you’ll have a track record of everything. Don’t worry if your teens’ income fluctuates from month to month—that’s completely normal. 

2. Outline monthly expenses 

The second step is to determine your expenses and how much you want to spend in each category. Here are some examples of expenses you may have:

  • Transportation (e.g. car, public transport) 
  • Food (e.g. dining out, take-out, groceries) 
  • Clothing 
  • Entertainment (e.g. movies, concerts) 
  • Gifts 
  • Sports (e.g. gym membership)
  • Phone bill 
  • Personal care (e.g. hair cut, cosmetics)

In this section, you’ll also want your teens to figure out some of their future savings goals. Some common goals may include saving for:

  • Post-secondary school tuition 
  • A summer vacation
  • Buying a new laptop

Although debt is less common for teens, if you’ve co-signed for your teens’ cell phone plan, then they may have shared responsibility to pay for it. Also, if they’re using the family car to go on trips, they could be chipping in to cover the car loan or insurance. If this applies to them, they’ll want to ensure they have money set aside to pay for these types of debts. 

3. Make the budget equal zero

Now it’s time to take your total income and subtract all of your expenses which should equal $0. If your kids discover that they don’t have enough money, then you’ll have to come up with creative ways to either increase their income or cut down on costs (or both!). If they have leftover money, it can be allocated towards an emergency savings fund or to allow them more freedom to spend on other expenses. 

4. Track your expenses

The next step is an important one: keeping tabs on their spending. For example, when your teen goes out to see a movie with their friends, grabs lunch or purchases a new pair of jeans, they’ll deduct the amount they spent from the respective categories. 

Throughout the month, they’ll be able to see whether they are on track with what they have budgeted. Checking in with them to have a discussion about what adjustments they would like to make may be a good way to get them to understand how their spending habits align with their budget. Ultimately it will depend on what the financial priorities are for your teen. 

How a zero-based budget can help teens 

By completing this type of budget your teens can start to reap the benefits. For starters, it’ll help them differentiate between their wants and needs (and ask themselves “do I really need these shoes right now?”). They’ll also realize that money is a finite resource and they will have to weigh out the pros and cons of each purchase. 

And with inflation, it’s worth pointing out to them that the cost of buying their favourite frappuccino will rise over time. This means they’re learning that a dollar today does not have the same purchasing power as a dollar tomorrow. That’s why starting off with a zero-based budget in their teenage years will help them build a solid foundation of money management skills that they can apply as they start their careers as young adults. 

As your teens complete this activity every month, they’ll notice how each month’s expenses can vary. For instance, during the holiday season they’ll want to spend more money on gifts while in the summer, they might want to spend money on dining out with their friends. 

Bonus points: if you can encourage your kids to do this for the next 12 months, they’ll get a big-picture overview of their annual cost of living. 

The best part of learning zero-based budgeting is that it gives them control over how they want to allocate their money.

The bottom line

Now that you understand how a zero-based budget works, it’s a powerful tool that will help your kids become confident in how they manage their money. Hopefully, this will help to create a conversation about their personal finances in your household so that you are one step closer to raising money-smart kids. 

Don’t forget that Mydoh gives tweens and teens the opportunity to build sound habits that will prepare them for when they start earning some real dough. When they look back on their youth, they’ll appreciate that you’ve taken the time to teach them the budgeting skills that will last them a lifetime. 

Download Mydoh and get started today. 

Best Personal Finance Podcasts for Parents

Kids and teens aren’t the only ones who can benefit from financial literacy. If you’re a parent who wants to build their money muscles but don’t have the time to sit and absorb a finance book, then listening to personal finance podcasts can be an easier way to improve your money management skills. 

There is no shortage of personal finance podcasts to listen to. That’s why we’ve rounded up 10 money podcasts that will deepen your understanding of money while you’re getting your steps in. Listening and learning on the go means you’ll arrive at your destination more informed and financially savvy. 

What are personal finance podcasts and how can they help parents?

Finance podcasts can help keep parents up-to-date on financial trends so you can make more informed financial decisions. These podcasts cover aspects of finance that apply to families, such as budgeting, investing, saving for education, and planning for retirement. 

Overall, listening to finance podcasts can empower parents to take control of their finances and help secure a better financial future for their families.

10 of the best financial podcasts for parents

Perhaps you’re thinking, there are so many podcasts! How do I choose? We’ve got you covered! Here are some popular personal finance podcasts to get your started.

image of stress test podcast visual

1. Stress Test by the Globe and Mail

The Globe and Mail’s personal finance team, columnist Rob Carrick and editor Roma Luciw, guide you through some of the most significant stressors your finances could face in the changing landscape of our economy. Roma says, “I’m passionate about financial literacy, especially among young people, and I’d love to help arm them with the tools they need to make smart financial decisions.” Rob is also author of the finance book for kids, How Not to Move Back in With Your Parents: The Young Person’s Complete Guide to Financial Empowerment. If you’re between 20 and 40, this financial advice is for you. 

Average audio length: 26 minutes 

Origin: Canada

Listen Here 

Image of a woman, Farnoosh Tobari, leaning on copy that says so money

2. So Money with Farnoosh Torabi  

Farnoosh Torabi is a financial strategist, TV host, and bestselling author based in the U.S. Her advice and insights are delivered through a lens of equity, inclusivity, and the changing world we live in. This award-winning podcast gives space to voices we don’t always get to hear in the financial world: women, BIPOC writers and experts, and immigrants, all of whom have a unique perspective to offer us all. 

Average audio length: 34 minutes

Origin: United States 

Listen Here

Image of two kids, woman and man with caption Marriage Kids and Money Podcast

3. Marriage Kids and Money with Andy Hill

Andy Hill interviews millionaire parents, couples who have reached financial independence, and financial industry experts. Interviews provide easy-to-understand information and actionable takeaways. Show topics include everything from how to pay off your mortgage early, to how to help your kids become future millionaires (who are generous). If you’re looking to improve your family’s financial wellness, have a listen. 

Average audio length: 38 minutes

Origin: United States 

Listen Here

Image of woman in green suit sitting on chair, Jessica Moorehouse, and title more money

4. More Money with Jessica Moorhouse

Canadian Money expert Jessica Moorhouse teaches listeners to save, earn, and do more with their money. She shares stories, expertise, and wisdom from top personal finance and business experts, celebrities, entrepreneurs, authors, and influencers to help simplify and demystify the complex world of money. If you want to get a better handle on your money, but you have no idea where to start… listen up.

Average audio length: 40 minutes

Origin: Canada

Listen Here

Image of smiling man with caption Cost of living and CBC Radio One

5. The Cost of Living by CBC Radio

Host Paul Haavardsrud examines how our everyday decisions connect with the larger economy and how money can make (or break) us. The show covers Canada’s most compelling business and economics stories and how they affect the day-to-day lives of Canadians. Topics range from online sports gambling to why Bugles are disappearing from supermarket shelves. 

Average audio length: 25 minutes

Origin: Canada

Listen Here

Image of speech bubble with dollar sign and title The Financial Confessions

6. The Financial Confessions 

The Financial Confessions is hosted by Chelsea Fagan, CEO of The Financial Diet, a site focused on women and finances. This podcast aims to uncover the financial truth behind every part of life and includes topics such as get-rich-quick schemes, the aesthetics of wealth, and the finances of divorce. Chelsea sits down with guest experts to look at earning, spending, and losing money. 

Average audio length: 60 minutes

Origin: United States 

Listen Here

Title How I Built This with Guy Raz against grey background

7. How I Built This with Guy Raz

Tune in for interviews with the world’s best-known entrepreneurs to learn how they built their iconic brands. In each episode, founders reveal deep, intimate moments of doubt and failure, and share insights on their eventual success. This podcast is for entrepreneurs, creatives, or anyone who just enjoys a great story. It’s also a great one to listen to with kids to stimulate conversations and get them thinking about their futures.

Average audio length: 49 minutes

Origin: United States 

Listen Here

Title The Stacking Benjamins Show against a white background

8. The Stacking Benjamins Show 

Hosts Joe Saul-Sehy and OG chat with guests about saving, investing, risk management, and more. A perfect podcast for listeners who want to learn how to improve their financial security in a laid-back and relaxed pace with some humour thrown in because who says finance can’t be fun?

Average audio length: 69 minutes

Origin: United States 

Listen Here

Two women of colour smiling with title Brown Ambition with Mandi and Tiffany

9. Brown Ambition 

Hosted by personal finance expert and journalist Mandi Woodruff and Tiffany “The Budgetnista” Aliche, an award-winning financial educator and author of the New York Times bestseller Get Good With Money. Brown Ambition is a conversation between two successful women of colour as they explore a variety of financial topics and strive to teach listeners how to build wealth, unapologetically. 

Average audio length: 48 minutes

Origin: United States

Listen Here

10. I Will Teach You To Be Rich

Financial advisor, Ramit Sethi, speaks with couples from all walks of life as they navigate financial stress. Sethi is author of a book by the same name and starred in the Netflix series, How to Get Rich. Each episode looks under the hood of a real-life couple’s finances, digs into their individual beliefs about money, and challenges people to live their rich life.

Average audio length: 1 hour

Origin: United States

Listen Here

Choose the right personal finance podcasts for your needs

The abundance of content can feel overwhelming, especially with the rise of financial influencers (we’re looking at you, TikTok). Here are a few factors to consider when searching for finance podcasts:

  • Look for podcasts that align with your specific financial goals, needs, and interests.
  • Does the host have the credentials and expertise to provide accurate and current information?
  • Some podcasts are more conversational, while others are more structured. Decide which format you prefer.
  • Some episodes are released daily, while others may be weekly or monthly. Choose a frequency that works for you.
  • Some podcasts are only a few minutes long, while others can be an hour or more. Determine how much time you have available to listen.
  • Who is the podcast’s audience? Is it catering to beginners, experts, or both.
  • Read listener reviews and look for podcasts with good ratings to ensure the content is of good quality and that it resonates with listeners. 

Invite your kids to listen to a family-friendly finance podcast with you—perhaps together in the car. It’s never too soon to develop financial literacy skills. Another helpful tool in teaching kids money smarts is the Mydoh app and Smart Cash Card. It helps kids and teens practice earning and spending their money securely. Mydoh also gives parents oversight, so you can watch their progress and encourage your kids to grow their savings—and their financial literacy. 

Download Mydoh and get started today.