Do you know where your family is financially? If not then a really simple thing to do is a balance sheet. It’s purely a list of your assets and your liabilities.
If you have goals and dreams then it makes sense to know where you’re at financially, and where you want to be. If you have debt then before you move on to your dreams you need to pay if off. An ongoing balance sheet can help you to track your progress.
To start:
- Take a piece of paper and…
- List all your debt accounts
- List all your savings and pensions accounts
Organise:
- Find out the exact balance on all your accounts (the time consuming part)
- Find out your current property price: UK Zoopla US Zillow
- Now using another piece of paper or an excel spreadsheet list all your assets on one side of the page and all your liabilities on the other.
- Total the two columns
- Assets – Debts = Current worth
You can also track your Net Worth here, although it is in dollars, not sterling.
Doing this exercise can be quite scary, I know I’ve done it, however if you want to get out of debt or achieve your goals, then financially your head needs to come out of the sand.
Next week: The debt snowball
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{ 3 comments… read them below or add one }
Oy. That doesn’t sound very fun at all! Reluctantly, I can see how beneficial it would be, though. I’ll put it on April’s To Do list.
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You’re right you know, its a pain to do (cewrtainly not fun at all) but unless you get things out in the open where you can see them you’ll never be able to see where you are going or where you want to go.
After years of floundering we are now moving along quite smoothly – this and they ‘B’ word helped us enormously
Cathy
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I just followed your zoopla link and found the house is worth a lot more than i thought, more like it was 12 months ago. I know this doesnt make any difference but I have a little warm glow!
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