Budgeting Terms Explained: Zero-Based, Sinking Fund, Net Worth

📈 APR vs APY: The Difference, With a Worked Example | Cash Book APR is what borrowing costs; APY and AER are what saving earns after compounding. Why 12% compounded monthly is really 12.68%, and why the two never compare. ↩️ What Is a Chargeback? How Card Disputes Work | Cash Book A chargeback reverses a card payment through the card scheme, not the merchant. Typical limits run to 120 days, and UK Section 75 covers purchases over £100. 🔁 Direct Debit vs Standing Order: The Difference | Cash Book A direct debit is pulled by the biller and can change; a standing order is pushed by you and cannot. Who controls the amount, and the 8-week SEPA refund. 🔢 What Is an IBAN? Structure and Check Digits | Cash Book An IBAN is a standardised account number under ISO 13616, up to 34 characters. How the mod-97 check works, and why a valid IBAN proves nothing about the owner. 🔓 What Is Open Banking? PSD2, Consent and Data | Cash Book Open banking lets a licensed provider read your bank data with your explicit consent. How PSD2 and the UK CMA order work, and the 2 regulated service types. 🇪🇺 What Is SEPA? Euro Transfers and Direct Debits | Cash Book SEPA makes a euro payment across 41 countries and territories work like a domestic one. Credit transfers, instant, direct debits, and the 8-week refund right. 🥧 The 50/30/20 Rule Explained: Definition and Example | Cash Book The 50/30/20 rule splits after-tax income into 50% needs, 30% wants and 20% savings. What counts as each, a worked example on $4,000, and how to track it. 🌊 What Is Cash Flow? Definition and Example | Cash Book Personal cash flow is money in minus money out over a period. How to calculate it, a worked example with $3,600 in and $3,350 out, and why timing matters. 🍿 What Is Discretionary Spending? Definition, Example | Cash Book Discretionary spending is the money you choose to spend after essentials: dining out, hobbies, travel. What counts, a worked example on $3,800, and 5 ways it hides. 🧯 What Is an Emergency Fund? Definition and Example | Cash Book An emergency fund is money kept for unplanned costs such as a job loss or a $900 car repair. What counts as an emergency, how much to aim for, and how to track it. ✉️ What Is Envelope Budgeting? Definition and Example | Cash Book Envelope budgeting puts a fixed amount into a named envelope per category and stops spending when it is empty. How it works with 6 envelopes, digital or cash. 📌 Fixed vs Variable Expenses: Definition and Example | Cash Book Fixed expenses stay the same each period; variable expenses change with use or choice. How to tell them apart, a worked example on $3,400, and why it matters. 🛒 What Is an Impulse Purchase? Definition and Example | Cash Book An impulse purchase is an unplanned buy, driven by the moment rather than a need. Why $5 items add up to $200 a month, and how to spot them in a log. 📈 What Is Lifestyle Creep? Definition and Example | Cash Book Lifestyle creep is spending rising to match income, so a $500 raise leaves savings unchanged. How it happens, a 3-year worked example, and how to see it in a log. ⚖️ What Is Net Worth? Definition and Example | Cash Book Net worth is what you own minus what you owe, at one moment. How to calculate it in 3 steps, a worked example, and why the trend matters more than the number. 🚫 No-Spend Challenge Explained: Definition and Example | Cash Book A no-spend challenge is a set period, often 7 or 30 days, with no optional purchases. What is allowed, a worked example, and how to log one so the result is real. 🪣 What Is a Sinking Fund? Definition and Example | Cash Book A sinking fund is money saved monthly for a known future cost, such as $1,200 of insurance due in a year. How it differs from an emergency fund and how to track it. 🎯 What Is Zero-Based Budgeting? Definition and Example | Cash Book Zero-based budgeting gives every dollar of income a job until income minus planned spending equals 0. How it works, a worked example on $3,200, and how to log it.