3 financial benefits of budgeting
BUDGETING OPENS THE DOOR TO FINANCIAL SECURITY.
A budget is a money plan. With it, you can organise and control your financial resources, set and realize goals, and decide in advance how your money will work for you. Budgeting is a great way to assess your financial needs. It will give your family an overall picture of where your money is coming from, when it is coming in, and how you are spending the money you earn.
Many people think that preparing a budget is very complicated or that it takes up too much time. Even if you are financially free of all debt, budgeting is still an essential part of your financial life. A budget can be as simple as it is powerful. The basic idea behind budgeting is to save money up front for both known and unknown expenses. A budget is the key to making everything else work. It is your game plan, your strategy. And it has to be proactive. Knowing where you stand financially and how to control your finances is a very valuable life skill.
BUDGETING WILL HELP YOU GET IN SHAPE FINANCIALLY.
When people ask about getting their finances in shape, they typically have very similar goals. They want to save more for emergencies today. They want security for themselves and their families in case disaster strikes. And they want to know how to learn about their money – because they know that when it comes right down to it, they are responsible.
BUDGETING HELPS YOUR KEEP THE MONEY YOU EARN.
You work hard to earn the money you receive. But, once you have your pay check in hand, do you use it wisely and efficiently? Without a spending plan it is difficult, if not impossible, to use the money in an efficient, strategic manner. Without a budget most of us will just muddle through life, trying very hard to stay one step ahead of our bills. If a budget makes you cringe, just think of the entire process in this way. First of all, you are simply summarizing how you already spend your income and, secondly, you are simply outlining some basic guidelines for your future spending. It becomes your own personal tool to develop awareness of how you are spending, where you are spending and on what things.
Contributed by Rich Brott