Personal budgeting is an important factor in regards to successful long term financial stability. Budgeting has many great aspects as well as showing areas of weakness. It can show the truth about your personal financial spending habits, areas that are not looked at enough, and if there are needs for a larger emergency fund. The reality of personal budgeting is that many people potentially do not keep a personal budget for one reason or another. People also don’t consider the negative effect that it could have on one personally and or how it effects the economy.
One major reason that an individual does not keep a personal budget would be the lack of knowledge on how to possess a …show more content…
Another economical downfall of non-budgeting would be the impending factor of unpaid bills and eventually bills being forwarded to collection agencies. When bills do not get paid, companies do not make the money they require. This can spiral downhill to companies having to lay employees off due to lack of returns, companies needing to cut moral building programs, or even companies going bankrupt. A final economic issue would be poor economic growth. People who do not keep a personal budget can potentially harm the economic growth. It creates a false reality of how the economy is really doing. Later on when an individual doesn’t have the means to keep spending, it can inadvertently make the economy show a drawback. It shows a false positive that leads to America believing that we are doing well when we are not.
The economic effects are on such a large scale, but not keeping a budget can lead to affecting someone physically, mentally/emotionally, and even in personal relationships. On a physical level, not keeping a personal budget can lead to a deficit in funds. This will in turn lead to someone not being able to purchase the necessities of life. A lack of nourishment and healthy hygiene lead to real physical ailments such as gum disease. These can be the effects of not keeping a personal budget. The mental and