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Budget

Budget

The term budget refers to an estimation of upcoming revenue and expenses over a specified period of time. Compiled and re-evaluated on a periodic basis, budgets are created to anticipate and guide spending for any entity. This includes governments, businesses, and even people and households of any income level. Budgeting is important because it helps to control and regulate spending. This allows for optimization of resources and money management, as it helps entities to plan ahead for financial needs. Additionally, budgeting creates structure for spending, so that entities can track their progress and re-adjust their plan if needed. Budgets also help to promote transparency and accountability. Knowing specifically how much each entity has to spend encourages responsible use of funds, as it makes it easier to see where the money is going. With a well-crafted budget, an entity can save money and make investments, since it is easier to prepare and account for expenses. All in all, budgets are an important tool of money management.

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