The process of creating a household budget allows families to learn about their monthly living expenses. NAAC’s template is a great tool for tracking the cash flow of the family. The learning experience is great, and will save time when understood. The budgeting process can be broken down into three subsections, which include the identification of income, mandatory, and discretionary expenses. Advantages of budgeting:
Budgeting forces us to plan for the future and to develop an overall direction for the family, foresee problems, and develop future savings.
Budgeting helps us understand significant information about the way we spend money and making better decisions possible.
Budgeting helps set standards that can control the use of our money and control and motivate future big purchases such as a car.
Budgeting improves the communication of the family.
Budgets also encourage cooperation because the various areas and activities of the family must all work together to achieve any goals.