A budget is a breakdown of your income and expenses for a specific period. Creating a budget allows you to keep track of what money is coming in and what money is going out. It is an organized way of looking at what you can and cannot afford. It is also a great tool to assist you with managing your money, whether you are making a significant amount or a small amount.
We are sometimes confronted with unexpected expenses; whether it is car repairs, a broken washing machine or a medical emergency. If you have wasteful spending patterns, these types of unanticipated issues can lead to additional stress. However, with a budget it can help to provide clarity as to the monies that are available for use to address the unexpected expenses. It would also show you whether or not you are over spending and if there is need to implement a strategy to control costs.
Creating a budget also helps with saving towards a future goal. For example, if you want to save towards a vacation, down payment on a house or for your child’s college education, a budget is essential to achieving that goal. To implement a savings plan, the following steps are essential:-
The budget plan would help you to stay focus, reduce some of your “wants” and keep you on the path to financial freedom.
NCBA offers many short and long term saving products that can assist you with saving funds for whatever purpose. Visit our savings page to learn more.