Preparation of individual budget - JSS3 Business studies Lesson Note

Preparing an individual budget involves creating a plan for managing one's income and expenses over a specific period, usually monthly or annually. A budget helps individuals track their spending, prioritize their financial goals, and ensure they are living within their means.

 

To prepare a budget, individuals typically start by estimating their income from various sources, such as salary, investments, and side hustles. They then list all their expenses, including fixed costs like rent and utilities, variable expenses like groceries and entertainment, and savings goals like retirement and emergency funds.

 

Once income and expenses are identified, individuals compare the two to determine if they are spending more than they earn (budget deficit) or if there is money left over (budget surplus). Adjustments can then be made to spending habits to align with financial goals and priorities.