1) A budget is a plan that allocates money for specific expenses like rent, food, etc. It is not simply spending less. 2) There are six key reasons to have a budget - it tracks spending, identifies wasteful spending, adjusts to financial changes, reduces debt, prioritizes spending, and develops better spending habits. 3) To create a budget, list monthly expenses and income. Expenses include necessities like rent and bills as well as flexible costs like entertainment. Income sources are also noted.