A budget is a carefully thought out plan of spending the money available for the required period of time. Apart from spending the available money for meeting our wants saving a part of the money is also important since saving of a part of the money is useful for meeting future requirements. Hence family budget means a plan of using available money wisely for necessary expenditure and also a plan for saving a part of the money for the future needs.
This naturally involves estimating of what the income will be during a period and how much is to be spent on different items of expenditure and what part of the income is to be saved. Hence budget is briefly described as a financial plan for future expenditure.
Definition of budget:
The main purpose of budgeting is to help a family to derive maximum benefit from the family’s income for that period. A budget is a plan for spending and saving within a given income for a definite period say a week, a month or a year.
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