Personal tracking of your Financial status

Before you develop any financial planning, you need to know your own current financial status. If you are married, you may include your spouse as the overall household financial status. There are 3 essential financial statements i.e Balance Sheet, Annual Income Statement & Monthly Income Statement.

Imagine these 3 Statements are just our child's school report book to determine how well they do in school and our employer's company financial report to analyze how good they perform in the whole year.

1) Personal Balance Sheet
With this balance sheet, you will realize what you owe, what you own and what is your net worth...
                          
  ASSETS
- Cash Assets (Saving accounts, fixed account)
- Equity Assets (Stocks)
- CPF Assets (Ordinary acc, Special, medisave..)
- Property Assets ( Market value of property 1, ...)
- Other Assets (Insurance Policy 1, 2.. Country club, Car..)
                           
  LIABILITIES
- Short Term (Credit cards...)
- Long Term (Car loan and housing loan..)

NET WORTH = TOTAL ASSETS - TOTAL LIABILITIES

2) Personal Annual Income Statement
With this, you will know how much you spent and how much you can save in a year...
                       
  ANNUAL INCOME
- Active Income (Net pay salary, bonuses, commissions...)
- Passive Income (Dividends, rental, royalties, other business profits...)
                       
  ANNUAL EXPENSES
- Personal (Food, clothing, entertainment, handphone, insurance, income tax, child school fees, bus..)
- Housing (Mortgage on cash portion, maids, utilities, groceries, property tax...)
- Transport (Public transport i.e MRT & bus, Car installment, fuel, maintenance, road tax, car insurance, coupons...)

ANNUAL CASH SAVING = ANNUAL INCOME - ANNUAL EXPENSES

3) Monthly Income Statement
This is the same as Annual Income Statement whereas for this case, you can track your spending and saving for every month.

Kindy do this 3 statements in an excel spreadsheet so that formulae can be tabulated easily. You may think that this is too tedious and time consuming but I am telling you that this is worth trying. The first time will be tough as you need to consolidate all the information but subsequent month will be much easy.