Budgets Give You a Plan

• A budget allows you to plan where your money is spent before you spend it. This allows you to prioritize how you spend your money. If you have specific goals you want to reach, budgeting makes it possible to channel money to specific goals such as getting out of debt. It also lets you decide how much to spend in each category. Making conscious decisions about how you want to spend your money each month before you spend it will make it easier to reach your goals and stick to your budget.
  
  

Prioritize Your Spending

• A budget allows you to prioritize your spending to match your personal needs and values. Most people follow a general idea of spending, but a budget allows you to determine how much you want to spend on each category. It allows you to see if your spending habits match your financial priorities and goals and make adjustments as necessary. You can also make sacrifices in one area so you can reach your goals in another. For example you may decide to cut satellite or cable television so you can save the money to go on one nice trip each year.
  
  

Stop Going Into Debt

• Following your budget and tracking your expenses each day will stop you from going into debt. A budget makes you more aware of how and when you spend your money and when you have reached your limits. This gives you the opportunity to stop spending once you have reached your monthly limit. It can also prevent you from using up the money you have set aside for food on the new shoes you want at the beginning of the month. It allows you to look beyond the available balance on your account and spend according to your plan.
  
  

Reach Your Financial Goals

• A budget is the biggest tool when it comes to reaching your financial goals. You can always spend more than you make. A budget helps to track your spending and make decisions based on your financial goals. The limits you set up can help to curb impulse spending, which makes it easier to work towards long-term priorities. Most financial goals take several months to reach, but a budget allows you to track your progress, which can keep you motivated.