Although it seems very basic, making a budget is essential. When you don’t have one is like driving a car without a road-map. You have no way of knowing how much money you need each month, and that can lead to all sorts of problems. You’ll accidentally spend too much and will wind up without enough money to pay important bills. Then the penalties and fees will add up, to cost even more. When you have budget, though, you know exactly how to set your financial priorities on a monthly, quarterly, and annual basis. When you need to save more, you’ll be able to look at your budget and see what to trim. If you have extra cash from a tax refund or year-end bonus, you’ll know the best way to spend it.