Spend Smart and Why you need to start Budgeting


The situation nowadays has highlighted the importance of saving money for emergencies, well as the future, and why we need to cut back on excessive spending. If you've found yourself always strapped for cash just before you get your next paycheck, you might be in need of a good budget plan. 

What is a budget and why do you need one?

A budget is a spending plan that takes into account both current and future income, expenses and your financial goals.

Budgeting is important because it helps you:

  • track your spending
  • save more money
  • and reach your goals faster


This is a perfect tool to use, especially if you're trying to get out of debt. A good budget plan also gives you an idea on where to prioritize, and it is one of the key elements that can give you financial independence. You can see more ideas on budgeting and why we overspend here.

If you're unsure, here's why and how to get started on fixing up your own budget today.


Budgeting helps you prepare for emergencies 

As I said earlier, the situation nowadays has been one big crisis for everyone. People lost jobs, or are working for lower salaries, but the expenses remain the same. I have personally learned that creating a pool of savings for the unexpected needs is a must. These unexpected events can derail your finances and cause all kinds of stress

Instead of spending that next cup of frappé or boba, use the extra money to create an emergency savings account, retirement account or to clear existing debts. It would be perfect if you have at least three to six months worth of funds available in your emergency savings account at all times.

Keep track of your cash flow (or where your money goes!)

Ever felt like you're supposed to have enough or more money, but it always seems to be not enough? If the end of the month arrives with you wondering where all your money went, it’s time to start a budget. Even as simple as listing what you spent every day can help you out with this! There are different budget methods that you can use here.


Knowing how much you need to spend for your bills, for your emergency fund every month and the amount you can set aside for your goals is important. This helps you to start to develop control and good spending habits that will eventually lead to a more peaceful mind and you being prepared for anything that should happen.

Help you cut out expenses and meet your goals faster


Once you have seen where your expenses go, you can double-check on things that you don't really need. Like that extra Hulu or Amazon Prime service that you don't actually use since you're maybe more into youtube or Netflix. It's an extra four or five dollars that can go into your savings for that next house instead of just renting.

Goals like that are an extra category in your budget. You add money toward it every month just like your other expenses. When you reach your goal, it is a surreal feeling.

After everything else, having to sleep without thinking where your money went and why you don't have enough to pay for your other needs is nice, and this peace of mind is what having a budget gives you. If you’re not currently budgeting your money, today is the perfect day to start a budget.

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