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Top 5 Reasons You Need a Budget
A budget is a useful tool that indicates your present
financial condition and projects into your future. You need a budget for several
Top 5 reasons to need a budget
A budget serves two purposes. It realistically reflects your
existing financial condition and projects into your future proceeding on some
reasonable predictions. A well organized budget helps a person in solving many
of his/her financial problems. There are several reasons why you need a budget.
Here are a few of them.
First, a budget is like a roadmap – both a useful tool and
an honest guide. It tries to let you known if the direction you are headed in is
appropriate in the context of your existing financial situation. A budget helps
you to stop unnecessary and whimsical spending and rely on saving and financial
planning instead. Unless you have a roadmap for reaching your goals and
objectives, it becomes difficult for you to have a clear idea of the progress
you have made. That makes your chances of success really remote. Like a big
corporate house depends on its budget for success, you too should have a well
made budget if you want financial success in your life.
Second, you need a budget because it enables you to
establish control over your money and not the other way around.
Third, another important reason why you need a budget is to
improve your marital relationship. Who doesn’t know that money is the root cause
of most marital discords? A budget is a neutral tool that takes no sides and
helps both of you to communicate rationally about monetary affairs. It can
provide you with a common purpose and minimize fights over money.
Ready for emergencies
Fourth, you need a budget because it keeps you prepared for
unforeseen emergencies. The main reasons for bankruptcy are sudden unanticipated
expenses or loss of employment. If you have an emergency fund thanks to your
budget, you are likely to tide over a crisis that could otherwise ruin you
Fifth, once you prepare a budget, you learn to spend on
essential items that you really need, and avoid splurging on unnecessary items.
Sixth, yet another important reason you need a budget is
that it could help you get out or stay out of debt.
Seventh, a budget gives you something that is difficult to
quantify: peace of mind. It ensures you a worry-free sleep at night without the
help of tranquilizers.
So begin budgeting as soon as you can. Do your homework and
collect budgeting advice available in bookstores and on the Internet. Then find
out how it gradually changes your life for the better.