Underspend(redirected from underspending)
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To spend less than one was allotted in a budget. Underspending in personal finance is almost always a good thing as it allows one to save more or to pay down debts. In corporations, however, underspending can be negative; for example, if a department does not spend its entire budget, the executives may conclude that it does not need such a high budget and cut that department's allotment. This creates a perverse incentive for departments and other subdivisions to spend their entire budget whether or not they need to.