A budget helps create financial stability. By tracking expenses and following a plan, a budget makes it easier to pay bills on time, build an emergency fund, and save for major expenses such as a car or home. Overall, a budget puts a person on stronger financial footing for both the day-to-day and the long term."}},"@type": "Question","name": "What Is an Emergency Fund?","acceptedAnswer": "@type": "Answer","text": "An emergency fund is three to six months' worth of living expenses set aside in case of an unexpected life event, such as employment termination, illness, or home maintenance cost.","@type": "Question","name": "What Are Some Key Reasons to Have a Budget?","acceptedAnswer": "@type": "Answer","text": "There are many reasons to have a budget, depending on the individual. A budget can often help build financial independence and freedom. A budget can set you on the right path to achieving your financial goals, spending within your means, saving for retirement, building an emergency fund, and analyzing your spending habits."]}]}] EducationGeneralDictionaryEconomicsCorporate FinanceRoth IRAStocksMutual FundsETFs401(k)Investing/TradingInvesting EssentialsFundamental AnalysisPortfolio ManagementTrading EssentialsTechnical AnalysisRisk ManagementNewsCompany NewsMarkets NewsCryptocurrency NewsPersonal Finance NewsEconomic NewsGovernment NewsSimulatorYour MoneyPersonal FinanceWealth ManagementBudgeting/SavingBankingCredit CardsHome OwnershipRetirement PlanningTaxesInsuranceReviews & RatingsBest Online BrokersBest Savings AccountsBest Home WarrantiesBest Credit CardsBest Personal LoansBest Student LoansBest Life InsuranceBest Auto InsuranceAdvisorsYour PracticePractice ManagementFinancial Advisor CareersInvestopedia 100Wealth ManagementPortfolio ConstructionFinancial PlanningAcademyPopular CoursesInvesting for BeginnersBecome a Day TraderTrading for BeginnersTechnical AnalysisCourses by TopicAll CoursesTrading CoursesInvesting CoursesFinancial Professional CoursesSubmitTable of ContentsExpandTable of Contents1. Keeps Your Eye on the Prize2. Ensures You Don't Overspend3. Leads to a Happier Retirement4. Prepares You for Emergencies5. Identifies Bad Habits6. Better Than Counting SheepWhy Is a Budget Important?What Is an Emergency Fund?What Are Some Key Reasons to Have a Budget?Personal FinanceFinancial Literacy 6 Reasons Why You Need a BudgetByAmy Bell Full Bio LinkedIn Amy Bell is an expert on investing and personal finance as well as the founder of WritePunch Inc. Amy has 15+ years of experience as a professional journalist, copywriter, and ghostwriter. She graduated from the University of Georgia with a B.A. in journalism and a minor in English.Learn about our editorial policiesUpdated April 07, 2022Reviewed byMargaret JamesThe importance of making a budget is a financial lesson that cannot be overemphasized. If you and your family want financial security, following a budget is the only answer.
lesson 2 homework practice personal and family budgets answer key
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