Financial freedom is not when you are rich, sometimes; you can be rich and still be poor at the same time. You are said to have attained financial freedom when your revenue supersedes your expenditure, you will end up having excess.
Budgeting is a financial plan for a particular term; it could be for a year, a quarter, or a month. At the end of every year, a country makes a budget for the coming year. A budget includes a list of your spending and expenditure.
Everybody needs a budget, for individual, the largest percentage of individuals lives on monthly income and wages, therefore, it is better to make your budget a monthly term or in relation to how your compile your income.
Before I came to the knowledge of budgeting, I have always planned my spending un-organized, and that has been killing me for a long time before I got to discover. You spend your money mostly on unnecessary items, you won’t know until you put down something.
I could have been a pauper, budgeting saved me from misfortune. My income is never enough, I always have to borrow to complement my spending every month, and before my income comes in, debt is already waiting to eat them up. How then do you expect me to scale through?
These are some Benefits you get from Budgeting through my personal experience.
Gives you control over your money
A budget guides you how to spend your money, with budgeting; you are in control of your money, and not your money handling your control. You won’t have to suddenly adjust to lack of fund, a factor that treats me so bad, and makes me go so broke even before the month halves.
Keeps you in your financial freedom goal
It guides you, and stops you from making unnecessary spending, all your need will be met with rest of mind even with limited income because you have budget according to your income.
Makes you know what you have spent money on
Sometimes, it becomes a headache for me, when I suddenly see that I am out of fund, and there are still important things to attend to. It sucks, you begin to think on what you have actually did with the money, it get worse only to find out that you have spent it on something of less value, and here is something important waiting to be sponsored. I thought saving my money in banks will curb my spending, it actually did, but it was limited, this is the only disadvantage of the ATM, you quickly go to the machine, when you see that you are broke.
Encourages your savings attitude
In budget, there will always be excess, that goes into savings, had it been you had not budgeted, you just see that you finished them all, and your eyes opens, what you did with them were not necessary, that equates to wastage, and you lack savings which is one of the road to financial power.
Allows you to manage your family
Your son, knowing full well that you were not going to give him any more contingency amount within the month, will also be pushed to have a budget, everybody gets settle as due, no one fights for getting the smaller share.
It alerts you of future dangers
Fuel was going to fly in price, food stuffs were going to be a little scarce, the government was going to control inflation, you quickly adjust to this in your budget, and you have no problem worrying what the situation reads.
Helps you to invest and generate more money
From your savings fostered by budgeting, you have money to throw into investment opportunities, and can even generate a part time business that will give you extra income.
These are some of the critical issues budgeting have been able to solve in my life.