FLFinancial Literacy

COURSE: FINANCIAL LITERACY

Unit 1: Financial Planning

What is a Budget?

A budget is a financial plan that helps you manage your money effectively. It's like a roadmap for your finances, showing you where your money comes from and where it goes. A good budget helps you live within your means and work towards your financial goals.

Key Components of a Budget:

  1. Income: Money you receive from various sources.
  2. Expenses: Money you spend on needs and wants.
  3. Savings: Money you set aside for future use or specific goals.

Why is Budgeting Important?

Budgeting helps you:

  • Understand your spending habits
  • Avoid overspending
  • Prepare for unexpected expenses
  • Make progress towards your financial goals
  • Reduce financial stress

Budgeting Myths:

Myth 1: Budgeting is too restrictive.

Reality: A good budget gives you freedom by helping you spend consciously.

Myth 2: I don't need a budget because I don't have much money.

Reality: Budgeting is even more important when resources are limited.

Myth 3: Budgeting is too time-consuming.

Reality: Once set up, maintaining a budget takes minimal time and saves you money in the long run.