Why do I need to budget?
Budgeting is also a good exercise to help you see clearly how much cash inflow you have got and how much outflow you have. When you do this sincerely, you can actually see a marked improvement in the way you decide to spend your money.
For one, you will understand that your outflow cannot be more than your inflow and vice versa will actually put you in a very dangerous situation.
Secondly, budgeting will help you start on savings which could help your keep most of your money and once you have a lump sum, you can use that amount to invest in stocks, shares, real estate or anything that will help you retire comfortably.
Budgeting is necessary if you find yourself in the following situation most of the time.
– You find that you visit your ATM more than once and you have no clue what you did with the money you had withdrawn earlier
– You find that you are spending more than you are bringing home every month
– You find that you cannot differentiate between a necessity and a mere attractive commodity
– You find that you are being more than hopeful of year-end bonuses or windfall money in order to pay off your debts
If you find yourself in any of those situations, it is past time that you started on a budget program.
Moreover, budgeting helps you identify your necessities. Most of the time, we are tempted to spend money on things that are disguised as needful which we can actually do without. Budgeting will put this unintended spending in check as we will be forced to put down in writing what we are actually spending on.
You can start on a budgeting program simply on a notebook where you can write in your daily inflows and outflows while balancing at the end of the month. Otherwise, there are software programs such as Microsoft Money or Quick Books which will help you budget once you set your priorities.
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