Archive | April 2019

THE DISADVANTAGES OF NOT HAVING A BUDGET

THE DISADVANTAGES OF NOT HAVING A BUDGET

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.

´╗┐THE IMPORTANCE OF HAVING A BUDGET BEFORE SHOPPING

THE IMPORTANCE OF HAVING A BUDGET BEFORE SHOPPING

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.