^tHe ImPoRtAncE oF hAvInG a BuDgEt^

Having a budget is not a choice but a necessity. It is important for everyone to have a budget in order to balance the amount of income with expenditure. Having a budget can help us plan our finances. With a financial plan, we will know where the money we have goes to.

It is essential for us to be able to take control over our money and not have our money control us. Therefore, we must be able to decide how we should spend and save our money no matter how much or how little we have. This way, we are in control of our finances. Being able to control our finances means that we must also be smart to decide between the things we need to buy and the things that we don’t.

It is never too early to start having a budget. So, it is important for us start planning our funds now, as it is a good practice for the future when we start working. As a working adult, one will have various money commitment such as a car, house, family, and others. Therefore, budgeting is vey important. If we do not have a budget, we may spend more than what we have. This will cause us to go into debt. Futhermore, we may also not have any savings for times of emergency if we fail to have a financial plan.

One of the methods of budgeting is to set a spending limit. By having a spending limit, we will be able to control our expenditure. A spending limit will help us to decide what we need and what we do not need to buy. Besides that, knowing the amount of money we have in hand will also give us an idea of how much we can afford to spend and how much we would want to put away as savings. With a budget, we will also be able to track our expenses. We can list down all our expenses such as food, stationery, car repair, movie tickets and others so that we will know what our money is spent on.

Having a smart spending habit is another way of budgeting. Being smart means that we should only spend what is within our budget and avoid extravagance. We must also avoid having the tendency to follow crowd instinct or to be easily influenced by sales.

So where should we start? It is best to first determine our necessities. We should only spend on things that we need and not on luxury items. As working adults, credits cards are norm as they provide invaluable convenience provided that we use them carefully and trim spending on extravagance. To shop smart, we can list down the item that we need to buy before we start shopping, avoid sales and set a limit for ourselves for each shopping trip.