Why Budget

Why budget? My knowledge, gained through education, training, and experience, allows me to answer that question with some authority. The main reason that I can tell you why to budget is that I have created a budget and benefited from it. I have also helped many others establish their own budget. They have reported benefits for themselves.

Benefits of Budgeting


Requires Organization

A budget requires you to analyze both income and expenses. During the analysis of your expenses you assign categories to them. This process is an automatic organization of all your monetary transactions. A good organization of this information simplifies your decisions regarding your financial life. Most people need to be better organized.

Promotes Awareness

A budget lets you know what is happening with your money. It is a tool that tells us you where, how much, and when your money is going. It tells you whether your money is doing what you want it to do, or not. A good budget will require you to be aware of and define your financial goals. A better awareness of your goals and efforts will simplify your financial planning.

Provides Control

A budget will allow you to take charge of your financial life. It will let you control what happens with your money. It provides you control over your money, rather than your money controlling you. Most people feel good about having that kind of control over their financial life.

Promotes Communication

If anyone else has any control over any of the monies involved in the budget, they should have some input during the creation of the budget. This is going to require communication. This is where differences about money handling should be resolved. Good communication is going to allow the development of a mutually satisfactory financial plan. It will minimize, if not eliminate, conflict over finances in the future.

Avoids Marital Conflict

The two main reasons for problems in a marriage are sex and money. If you do a good job of communicating during the budget process, you can greatly reduce future problems concerning money. When you decide what you want your money to do, where it is going to go, and how much goes where, you avoid reasons for conflict.

Reduces Personal Stress

One of the main reasons for personal stress in our lives is worrying about money. We often worry about how we are going to pay this bill on time. Am I putting back enough for retirement? Can I afford to buy a different car? These types of questions are answered by a good budget. You don't have to worry about, lose sleep over, or be stressed out by these things. You already know the answer! They answer is provided by the budget.

Why budget? You budget for the benefits resulting from a good budget. I have shown you some of the benefits. There are many more benefits, if you take the time and make the effort to develop a good financial plan for your life.