Benefits of Spaying and Neutering - Health Neutering a male eliminates the possibility of testicular tumors and greatly reduces the chance of prostate problems. Neutering decreases the incidence of perianal tumors and hernias, which are commonly observed in older, unaltered males. Neutered males are less likely to try to escape a yard to find a female in season. This reduces the likelihood of them being hit by cars, getting into fights or lost. (Neutering is no substitute for a securely fenced yard, however).
Females spayed before their first estrous cycle ("heat") greatly reduces her chance of mammary tumors, ovarian cancer and uterine infection (all of which can be fatal and costly to treat). A spayed female eliminates the neighborhood stray males from camping out on your lawn trying to get at your female when she comes into "heat." Giving birth to a litter can be dangerous to your female. Some breeds have a high rate of cesarean sections, which are expensive and can be risky.
Benefits of Spaying and Neutering - Temperament Spaying and neutering before sexual maturity also offers a temperament benefit. Males neutered early in life tend to be less aggressive and less distracted. Neutered males are less likely to scent mark (real problem when they decide to mark inside the house). A spayed female also does not hormonally based swings and will be more focused on you as well. A female with a litter can become very aggressive, even to family members. Spaying also makes your female a better companion.