Whats a Budget

Topics: Personal finance, Family, Budgets Pages: 3 (434 words) Published: March 17, 2013
What is a budget?

Budgets are financial documents used by households or businesses to plan for their financial futures. They assist people in understanding what bills they have, how much money is left over and where the extra amount goes. Budgets serve many purposes including understanding spending habits, gaining control of the money and developing a savings plan

The purpose of having a budget:
The main purposes of setting up a household budget include:
1. Learning what you spend and where you spend it
2. Separating non-essentials from essentials and
3. Track what you earn versus what you spend.
4. Consideration

The benefits of having a budget:
1. Take control of your money
2. Create a financial plan
3. Stress less
4. Live within your means
5. Find out what’s important

Areas that would normally be included in a household budget: 1. Utilities (Water bill, Light Bill and cable bill)
2. Rent/ Mortgage
3. Groceries
4. School expenses
5. Travelling
6. Entertainment
7. Car Payment
8. Credit card payment
9. Tithes
10. Medical expenses
11. Mortgage on furniture
12. Car maintenance
13. Day care

Budget Income and Expenditure|
Income:| | |
Salary| 40,000| |
Child Support| 5,000| |
| | |
Total| 45,000| |
| | |
Expenses| | |
| | |
Rent| | 7,000.00 |
Electricity| | 3,000.00 |
Water| | 1,000.00 |
loan on furniture| | 2,064.00 |
Food| | 12,000.00 |
Entertainment| | 2,000.00 |
Transportation| | 5,000.00 |
Saving| | 2,936.00 |
Daycare| | 5,000.00 |
School expenses| | 5,000.00 |
Total| | 45,000.00 |

Reflection:
1. The preparation of this assignment in particular the area of compiling a budget as educate me on the importance of having a budget and the benefits that can be again from having a will structured budget....
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