How Not Having a Budget Can Affect Your Financial Future

Despite knowing how important it is, many people still avoid budgeting. When people talk about budgeting it’s often in a negative light. Most people view “budgeting” as a set of rules and restrictions. It’s not fun! They don’t consider it a “tool” or a method to improve their finances.

But why is it so hard to budget? The closest explanation can be attributed to one’s feelings about money. You work 40 hours per week to earn money for your living expenses. It’s your money. You feel you have the right to spend it the way you want to. Budgeting means sacrificing money for your most important needs, and this means taking away money you want to spend for fun to necessary stuff like bills, housing, and food. For those who have been prioritizing their wants for a long time, this can feel terrible!

If you don't plan you budget you can easily fall into a financial disaster.

The thing is it’s easy to spend money, but it’s hard to earn it when you need it the most. On that note, let’s find out what financial disasters can easily happen if you don’t budget:

It’s Easier To Get Into Debt

Having a budget keeps you from overspending and falling into debt.

Without a budget to keep you from spending freely and doing whatever you want with your money, it’s easy to fall into debt. When you don’t have money for groceries, rent, and car repairs - you know what you’ve got to do? You have to borrow money. If you have a budget, this doesn’t happen. You would have enough money for necessities and enough leftover money to buy what you want. 

Debt can be a lifesaver when you’re out of cash but it can also ruin your finances in the future.

how do you make sure you never run out of cash or get into bad debt?


  • 1
    Budget your income consistently and make necessary changes every week or so.
  • 2
    Cut unnecessary spending that adds to your monthly payments.
  • 3
    Build an emergency fund.
  • 4
    Buy only what you can afford and only when you need it.
  • 5
    Use a budgeting/ money tracking app like Mint, Quicken, or Dollarbird.

Sudden Expenses May Catch You Off Guard

Imagine getting into a car accident the same week you have to pay your rent. If you’re living from paycheck to paycheck with no savings, insurance, or emergency fund this situation can leave you feeling anxious and stressed out.

This is why having an emergency fund is very important. It’s a wise financial move that will make you more secure no matter what emergency arises.

If you don't have an emergency fund, unexpected situations can leave you feeling anxious and stressed out.

Emergency funds are savings that you keep in the bank for emergency purposes. Want to start saving for your emergency fund? Here’s a short step-by-step guide on how to get started: 

How To Start Saving For Your Emergency Fund


  • 1
    Track your monthly income and expenses. Include recurring and extra expenses you have every month.
  • 2
    Start a savings goal. Identify the amount you want to save. According to experts, your emergency fund should be equal to 6 months of your current living expenses.
  • 3
    Plan to save. Find what expenses you can cut in order to save more money. Or get a second job or a side hustle to help you fund it.
  • 4
    Stay on track. Don’t let your emotions get in the way of you spending your saved money. Try to put your saved money in a special account so you can’t easily access it when you're tempted to buy something you want.

You Won’t Have A Safety Net

Mortgage and credit concept. Adult couple planning their future

Saving is easier if you think for the future and set realistic goals.

Without a budget, you can’t estimate how much you can save every month. In fact, you probably wouldn't even consider saving at all since you may feel like you don’t have enough money to save in the first place. However, the first thing you have to do if you want to hit your savings goal, is to stick to a consistent budget. 

Most people avoid budgeting because it seems like a chore. And then there are people who like it, because it relaxes them to organize and visually see their finances in order. Whether you’re the former or the latter, here are a few tips on how to successfully create a budget and savings plan. 

how to successfully create a budget and savings plan


  • 1
    Set realistic goals when you’re first creating your budget.
  • 2
    Use the 50-30-20 rule. Spend %50 of your income for needs, %30 for wants, and %20 for savings.
  • 3
    Plan for the future. Saving is easier if you think for the future.

It’s Easier To Waste Money

It’s easy to think you have enough money when you don’t track your cash flow or your expenses. Ignorance is bliss until that moment you find out you’re broke and financially incapable of living the lifestyle you want.

Here are things you should do to stop wasting money today:


  • 1
    Start budgeting according to your living capability and income every month.
  • 2
    Track your expenses for a week to see what things you mostly spend money on.
  • 3
    Stop emotional spending and impulse purchases.

Key Takeaways


Having a budget is like traveling with a map. You will never feel lost and you’ll know exactly where you’re going. Budgeting can make you feel restricted sometimes when the income is low and you have to sacrifice for the things you need. However, if you stick with your budget, you’ll be able to grow financially and reap the benefits of your sacrifices later on in life.

Want To Learn How To Make And Stick To A Budget?

Join MoneyHacks News FREE Today!