Which of the following is considered a benefit of budgeting?

Budgeting is a crucial financial tool that allows individuals to manage their money effectively. One of the key benefits of budgeting is that it helps establish clear financial goals. By creating a budget, you can outline your income and expenses, prioritize your spending, and allocate funds toward specific objectives, whether they are short-term savings goals, debt repayment, or long-term investments. This clarity enables you to make informed decisions and track your progress over time, ultimately leading to better financial wellbeing.

The other options illustrate consequences that budgeting aims to avoid, such as increased debt and more financial confusion, as well as unplanned expenses. A well-structured budget provides a roadmap for your finances, reducing the likelihood of encountering these negative outcomes. Through careful planning and goal setting, budgeting fosters a proactive approach to managing your finances.