A budget is a written down financial plan. It is an estimate of how much income you are expecting and how much you intend to spend within a period of time. (eg within one month, three months, six months and one year )
You should have a list when you go out shopping, to which you attach a cost. When you do that for every naira and kobo spent, you will be able to identify what is taking the chunk of your money, and then you will either reduce your spending on that item or even eliminate it completely from your list thereby giving you some savings.
Here Are 4 Reasons Why You Should Have A Budget.
1. A budget will help you to keep track of all the money that comes in and goes out. You have an idea where the bulk of your income goes.
2. A budget helps you to develop financial discipline.
3. A budget serves as a benchmark for monitoring and evaluating your income and expenditure. You are able to find out where you are overspending or underspending and make the necessary adjustments.
4. A budget, helps you to curtail unnecessary spending as you are forced to stick to it. This brings about savings and eliminates debts.