Budgeting Importance

UNIT 1 ASSIGNMENT

LORENZO JAMES

10-11-15

This assignment will explain what budgeting is and why budgeting is so important to use on a daily basis.

Budgeting is a process of taking time towards creating a plan to spend your money, this plan is obviously called a budget. When you create this type of spending plan it allows you to keep track of your funds and allows you to prioritize your spending having advanced determination towards if you will have enough money to do what it is that you want to do or spend on. Budgeting concerns balancing your expenses and income, this will help you keep from spending more than you make and keep you out of debt or help you work your way out of it. Using a budget also allows you to forecast the amount of money you may be looking to save for important dates such as vacations, birthdays, emergencies or special gifts. A realistic budget to forecast spending can also help with long term financial planning, this will allow you to make real time assumptions towards your annual income, expenses and long term goals such as retiring or starting your own business. A budget also provides experience in individuals because most people do not realize how much of their own money is spent on what, most businesses need budgets in order to properly determine how to deploy their assets and keep track whether their spending is going over preset spending limits.

                                        REFERENCES

• http://www.referenceforbusiness.com/management/A-Bud/Budgeting.html