Neither of them have any other assets or debt (Let’s keep it simple).įamily 1 could last only one month without income before draining their savings. Family 1 has $8,000 in a savings account. Imagine two separate families each spend $8,000 a month. It creates the cash flow to cover your expenses if you didn’t have any income coming in from a job or your business.Ī small scale example would be an emergency fund. Net worth is your ticket to financial freedom and independence. Net worth is just like home equity except it’s ALL of your assets minus ALL of your total debt. Now imagine you were to sell or liquidate everything you had of value and pay off all the debt you have. When someone sells their house, the check they walk away with after paying off their mortgage is the equity. Your balance sheet also calculates your net worth. That’s the info most people miss, but you won’t. Your balance sheet should also equip you with the info you need to improve your financial situation by understanding what’s helping or hurting your cause. It’s the way to organize your finances and make sure you’re aware of where all of your money is and that you’re staying on top of all of your debt. Need a personal balance sheet template?Ī personal balance sheet is a list of everything you own and everything you owe (aka your assets and liabilities) at this very moment all on one sheet.Tracking your net worth improves your financial position.How to make your personal balance sheet more efficient.Personal Return on Net Worth – What is it and why did I make it up?.Key Information Missing from a Personal Balance Sheet.Step 5: Categorize your total liabilities / debts.Step 2: Make a list of your DEBTS and where to get the most current values.Step 1: Make a list of your ASSETS and where to get the most current values.Home Budget - Our original selection of home budget worksheets.Family Budget Planner A yearly budget planner, with the same categories as the household budget spreadsheet.Household Budget Spreadsheet (monthly) - More detailed and includes child expenses.Personal Budget Spreadsheet The 12-month version of the above spreadsheet.Money Manger - A more advanced budget management tool for Excel. After making a change, you should check the formulas to make sure they are still correct. If your Net is negative, that means you have overspent your monthly budget.Īdding or Removing categories: You need to be careful when adding or removing categories, to avoid messing up the formulas used for calculating the totals. The Monthly Budget Summary table in the upper right of the worksheet totals up all your income and expenses and calculates your Net as Income minus Expenses. So, if you spend more than you budgeted for, the value in the Difference column will be red - to help it stand out as a warning. The spreadsheet uses the accounting format where negative numbers are in parenthesis like (115.00), and conditional formatting is used to make the negative numbers red - red means bad in this case. The calculations in the "Difference" column are set up so that negative numbers are bad. Using the Personal Monthly Budget Template See our articles Make a Budget and 5 Basic Budgeting Tips if you are just getting started or new to budgeting. At the end of the month, you record in the "Actual" column how much you really spent during the month.įor a more detailed set of budget categories, see the Household Budget worksheet. This represents your goal - you're trying to keep from spending more than this amount. You record your desired budget for each category in the "Budget" column. The purpose of this type of budget worksheet is to compare your monthly budget with your actual income and expenses. Some numbers are included in the Home Expenses category as an example, but you'll want to replace those numbers with your own. To use this template, just fill in numbers that are highlighted with a light-blue background (the Budget and Actual columns).
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