With the new technology, there are a number of web and mobile apps that are available in the market to help students keep track of their spending. Such applications are instrumental in helping students to create personal monthly budgets and thus saving them adding worry of making financial budgets on top of their already constrained effort of meeting deadlines and ensuring a sound time-management. It is absolute essential to prepare a personal budget for students because it help them to plan and manage their money carefully. I will do my essay based on a discussion of why personal budget is essential to students.
Some of the benefits of preparing a monthly budget for students include;
- Reduced Stress-Having a budget saves students the stress of having to worry about their bank balance and whether they will be able to meet all their monthly expenses. This is because budgets organizes a student’s spending whereby every dollar in the budget is accounted for to cover all the expenses a student desires to cover.
- Eliminate Overdraft Fees-Most parents, sponsors or individual students have enough trouble funding for the tuition fees of students. Lack of budgeting may result to throwing an overdraft fees on top the school fees which is overwhelming o whoever is paying school fees. Budgets eliminates such overdrafts because of a number of reasons such as ensuring that students do not purchases those things that they can’t afford.
- Good Habit-It good to start budgeting as early as when one is still in college because the good habit follows one even in life after college. Keeping personal budgets helps people to save appropriately based on their financial capacity which is a good way to avoid serious financial problems as well as avoiding lack of financial security. Budget helps students have good money management skills.
- Keep track of careless spending-A budget is a good way to have a control of one’s monthly spending. Budgets helps to identify areas where one is being tempted to overspend, and putting a limit on the amount of cash to spend on those areas. Personal budget is a great way to reflect their income and expenses as well as debts and personal net worth.
- Finding Gaps- Personal budgets helps find gaps where one needs to not only address the problem of irresponsible spending but also the challenge of not being able to meet essential needs. A budget will reveal areas where one is coming up short and how much extra cash they will need in order to meet their essential needs and live comfortably.
I would recommend students to create personal monthly budgets so as they can determine their cash flow, their daily spending as well as their financial awareness. Many students do not know how they are performing financially, and creating a monthly budget would help them see exactly where their money goes and how much left over they have. Another advantage of a personal budgets is the comparison of income against spending and savings and what it is necessary to change. Create a personal budget is a good habit for students in order to manage their money properly and prepare early for a lifetime of financial discipline that would eventually see them attain financial security.