Budgetting is one of the skills which need to be mastered for an individual to attain financial independence. Without it, savings is almost close to impossible. Money being a scarce resource and medium of exchange all over the world needs to be put into right use to avoid scarcity. Budgetting comes in handy to ensure that every penny is put into right use. Without much ado, let's dive dipper into the reasons why budgetting will save your fnances:
1.) Emergency purposes - Budgetting will help in ensuring that you are able to fully meet any situation which may come unexpectedly and rise through it. This can save you embarrasment of borrowing from friends or even going to the bank to take loans.
2.) Avoid overspending - It normallys helps when it comes to capping amount which an individual is supposed to spend. It helps in understanding whether you are operating within your budget or outside the budget. It helps in cultivating culture of being financially discipline.
3.) Helps in attaining goals faster - it helps in ensuring that if one wants to acquire a vehicle or any other asset, one sets aside just enough to enable them to achieve their goals within a particular time frame.
4.) Improves one's self esteem - When an individual has done his/her budget and follows it accordingly, it will help in stimulating the hormones which are responsible for happiness and thus they will be happy. Being happy will translate to higher self esteem as they will freely interact will other people without feelings of guilt.
5.) Reduces dependency ratio - Many people end up depending heavily on other people for them to pull them out of their financial misery. What brings about the problem is lack of a sound plan which will help in utilising your finances in the right way.