All About the Personal Financial Statement

By keeping tabs on your finances, you can create a secure and fulfilling future. That’s where a personal financial statement comes in.

Why You Need a Personal Financial Statement

Ideally, your personal financial statement will show that you have a positive net worth and your assets are greater than your liabilities. This can allow you to position yourself as a responsible borrower and someone who knows how to manage their money well.

How a Personal Financial Statement Can Change Your Money Habits

A personal financial statement can be instrumental in the way you think about your money and manage it. Here’s why: When you see your net worth, you’ll realize that many of your previous and future behaviors affect that figure.

What’s Included in a Personal Financial Statement

Balance Sheet Income Statement Cash Flow Statement

What to Exclude From a Personal Financial Statement

Your personal financial statements will not contain any business-related assets or liabilities. The only exception is a personal loan for your business or any other tool you’re directly accountable for.

How Often Should You Update Your Personal Financial Statements?

It’s essential to review and modify your statements every month or every other month. This way, you’ll always be up-to-date on where you stand with your finances and can make adjustments to your spending and saving habits as necessary.

Ways to Increase Your Net Worth

Cut Expenses Look for New Income Sources Buy a House Build an Emergency Fund Get Out of Debt Invest Get Insured

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