Why Create a Budget?
A budget allows you to see where your money is being spent, how much you are spending and how much you have leftover to save. Only by creating a budget will you be able to determine if you can really afford your daily latte or coveted convertible, or if you’re better off allocating that money someplace else. Along with keeping track of your finances, a budget allows you to plan for short- and long-term goals. With a budget, you can figure out how to save for your vacation in one year, a bigger house in five years or your retirement in 20 years; it’s all there in black and white so there will be no surprises later on. “Most people don’t budget properly because they’re not taught to,” says Howard Dvorkin, president of Consolidated Credit Counseling Services in Fort Lauderdale, Fla. “There are no courses I know of, especially in the high school level. A lot of families purposely don’t talk about finances; I think that’s extremely detrimental.” Budget-Making Basics Creating a budget is a s
