You may be familiar with reviewing your financial statement for your business, however, have you also reviewed your personal financial statement recently?

A personal financial statement outlines an individual's financial position at any given point in time. This typically includes a detailed breakdown of total assets and liabilities. The statement can help you track progress toward financial goals and how you are building wealth. It can also be used when applying for credit.

Essentially, your personal financial statement is a simpler version of a corporate financial statement and can show you:

• An overview of assets and liabilities as an individual or a couple.

• An individual's net worth as determined by subtracting liabilities from assets—a positive net worth shows more assets than liabilities.

• Net worth can fluctuate over time as the values of assets and liabilities change.

• Personal financial statements are helpful for tracking wealth and goals, as well as applying for credit.

• Although they may be included in a personal financial statement, income and expenses are generally placed on a separate sheet called the income statement.

Like a business financial statement, your personal financial statement shows your net worth— assets minus their liabilities—which reflects what that you have in cash if you sell all your assets and pay off all your debts. If liabilities are greater than their assets, the financial statement indicates negative net worth. If you have more assets than liabilities, you have a positive net worth.

Keeping your personal financial statement up to date allows you to track your financial health over time. This can be an invaluable tool if you want to change your financial situation or apply for credit such as a loan or a mortgage. Knowing where you stand financially allows you to avoid unnecessary inquiries on your credit reports and the hassles of declined credit applications while keeping you on track to financial success.

If you need more information, please contact Team SBDP.