A Personal balance sheet, also called a networth statement provides a summary of assets and liabilities that one has at a particular time.
It involves three steps:
These include available cash and money in the bank accounts combined with other items of value such as a home, rental buildings, or a piece of land. Also include motor vehicles and other personal belongings such as furniture and home appliances etc.
Liabilities are amounts you owe others but do not include items not yet due, such as next month's rent. List all your debt balances including personal loans, car loans, mortgages etc.
A net worth is the difference between total assets and total liabilities and it provides a measurement of the current financial position.
Here are important things to note concerning your networth:
Before we go on to the next personal financial statement, i have provided for you some financial tools to help you prepare your your personal net worth statement.
1. Personal Balance Sheet Worksheet: Download, print and use.(pdf file)
2. Net-Worth Statement Worksheets: Use these worksheets to prepare your personal balance sheets. (zip file)
When you are through, come back here and proceed to prepare your Personal Cashflow Statement.