What may be the consequence of failing to track personal expenses?

Failing to track personal expenses can lead to unexpected financial crises because not monitoring spending can result in overspending or accumulating debt without realizing it. When individuals do not have a clear picture of their financial situation, they may spend beyond their means, which can lead to an inability to meet financial obligations. This lack of awareness may create a cycle of stress related to finances, resulting in emergencies like needing to use credit cards for essential expenses, which can further exacerbate the financial situation.

In contrast to this correct understanding, improved financial awareness would stem from actively tracking expenses and developing a budget. A higher credit score typically results from responsible financial management, such as timely payments and maintaining low credit utilization, which tracking expenses can help facilitate. Additionally, tracking expenses often leads to a more conscious approach to spending rather than a decrease in spending without analysis or awareness of where money is going.