The variance between the budget and the actual expenditure gives us the performance indicator of how disciplined we are when it comes to sticking to a budget. The variance between the projected income and actual income gives us the performance indicator of how accurate our estimates are or how hard we are working. Projected income – this is the money that you expect to earn now and in the future.īudget – this is a list of the items that you expect to buy, quantities, and their respective pricesĪctual income – this is the actual money that you earn as time progressesĪctual expenditure – this is the money that you spend buying things This is a basic personal finance system so we will consider the following components Major components of a personal finance system To be financially successful, one must develop the habit of spending less than one earns and investing the difference in business ventures that will multiply the money invested. The majority of people spend more money than they earn. All of our efforts will be for naught if we do not properly manage our finances. We go to school to obtain a good job, and we engage in business and other related activities to make money. Let’s face it, money drives the world we live in. Read: Budget Manager: Jobs, Salary, Education Why manage Budget?
This allows you to see how much money you have and how it is spent, allowing you to budget your money appropriately for your needs.
Since then, the technology has been adopted by businesses, banks, and governments, who use spreadsheets to create budgets, track spending, and create financial reports.Ī spreadsheet, like a business, benefits a person’s finances by putting all of the information in one easy-to-read location.
0 kommentar(er)
