There are simple ways to make or create your own Personal Balance sheet even if you're not an accountant. If you just want to monitor your Balance sheet,it is a smart idea so you know how much you own and how much you owe. Basically all you need is to write down all your assets and liabilities. It is important you know all of them and have some receipt and proof for proper documentation.
To get your net worth you have only to subtract your total assets from your total liabilities. Remember your net worth go up as your assets increases and your liabilities decreases and this would be a good sign you are in a good hands. Once your net worth go down- it means your assets decreases and your liabilities increases and your personal finance is in danger.
Monitoring your personal finances is very important nowadays. The most important we can do, spend what you can afford and try to save during rainy days if possible.
Personal Balance Sheet
As of January 1,XXXX
Assets:
Cash on hand: XXX
Savings account: XXX
Checking Account: XXX
Prepaid Deposit: XXX
Cars: XXX
Home: XXX
Retirement: XXX
Investments: XXX
Other: XXX
Total Assets XXX
Liabilities:
Home Mortgage: XXX
Car Payment: XXX
Credit Card
Other Debt: XXX
Total Liabilities XXX
Balance sheet is a great help for everyone who wants to see what happen to their income for the whole year.
ReplyDeleteI remember this in Accounting subject hehehe. Thanks for the reminder sis.
ReplyDeleteIt's better to monitor the balance sheet as the assets and liabilities are there and items which can affect the profit and loss in future periods.
ReplyDeleteThis is so helpful - thanks for sharing this - brings back those times that I was working on Accounting.
ReplyDeleteIt is good to monitory one's networth! by the way, robert kiyosaki considers your house and car as liabilities. It was hard for me as an accountant to understand his point, but he does have a point haha. The assets he consider is something that generates income. If you put your house for rent and earn rent income, that is an asset. If you pay mortgage it is a liability.
ReplyDelete