A budget can be defined as an estimation of the proposed expenses and revenue which are bound to occur over a given period of time in the future.
It is mostly complied and reassessed from time to time. Budgets can be done on an individual basis, it can also be done for a family, a business entity, the government, the country amongst others. Basically, anyone who has a major or minor involvement with money, would certainly need a budget.
Having a budget is
essential, as it helps you to effectively watch and plan your spending. However,
if you do not have a budget, you would realize that your financial prudence is
nothing to write home about, as you would spend more than required.
Below are the
disadvantages which are inherent in not having a budget:
You would easily get into debt: This is one of the common happenings when you do not have a budget. When you have various expenses, and you find it hard to arrange them in order of preference, you would realize that there is a need to fully satisfy yourself. Hence, you would find yourself borrowing so that you can buy all that you need. However, when there is a budget in place, it would help you plan your spending; you would buy what you can afford in the present, and get the rest in the future.
You would be taken aback by surprise expenses: Not having a budget implies that, there would be times when some expenses would spring up, and you would not know how to go about them. This is because there is no budget in place. A budget helps you to plan well ahead of time. Also on a budget, there would also be the inclusion of miscellaneous which suggests that, in case of unplanned expenses, you would be able to stand up to them within your financial capacity.
You would not be able to save: When you do not have a budget, you would realize
that it is very hard for you to save. This is based on the fact that the
absence of the budget, did not pave way for you to track your spending pattern.
You would be surprised to discover one day that you have nothing to account for
in your savings.
A budget is known to be a financial plan which
is meant for a defined period of time. It could also include the projected sales
revenues and volumes, expenses and costs and a host of other factors. Families,
organizations and the government often make use of a budget to make strategic
plans of their events or activities.
A budget can also be said to be a sum of
money which is apportioned for an intended purpose, and also the abridgement of
proposed expenditures with proposals and how to achieve them.
When it comes to any shopping activity, a
budget is an essential component, and it is essential that before shopping,
there is a thorough budget which contains everything you want to buy.
Below are the major reasons why a budget
is needed before shopping:
It makes shopping simpler: When you work with a budget, you can be sure that the entire
process of shopping becomes way easier. When there is a budget on ground, you
would not have to stress yourself during the course of shopping, because you
have sorted out the price and quantity which you need. Hence, all you need do
is, pick the items you want accordingly.
It sets priority: Most
times when we want to go shopping, we know what we want. However, there are
times when the money we have is not enough for all the items we want. Hence,
during shopping, we end up getting stranded when our money gets exhausted.
Having a budget prevents that, as you would have everything planned out in
order of priority before going shopping.
Control of your money: One
feature which a budget gives, is total control of your money. When you have a
budget, you would be able to know the exact amount needed for shopping, and
also to save. A budget which is well stated, gives the owner full control of
his or her shopping funds.
Aids you to save money: Having a budget helps you to save money. When a budget has been
done before shopping, it would be required that you stick strictly to it while
shopping, and it would be easy for you not to exceed your budget.