Personal finance

Personal financial plan – Analyzing your debt
The personal balance sheet and personal income statement provide very valuable information but it is through the use of financial ratios that you can actually interpret the numbers and take corrective actions where necessary. Just as Benjamin Franklin once said “If you fail to plan, you are planning to fail” so let’s move on with our series of articles on how to develop a personal financial plan. In last week’s article we described more
Personal financial plan – Analyzing your liquidity
Have you calculated your personal net worth and spending pattern by developing a personal balance sheet and personal income statement? If you have completed this task, which is the first step of the process to develop a personal financial plan, then you are ready to analyze the data in order to better understand how you are managing your financial resources and take corrective actions where necessary. This is done through simple financial ratios which will allow... more
Evaluating your financial health – personal income statement
In last week’s article we described how to develop a personal balance sheet in order to calculate your personal net worth. The personal balance sheet is simply a snapshot of you financial health at a given point in time. In order to move on in the process of creating your personal financial plan, we now need to determine your spending pattern. This is done by developing a personal income statement which is what will be covered in the following article.

Personal income statement

A personal income statement... more
Evaluating your financial health – personal balance sheet
Are you trying to find a way to save enough money to meet your financial objectives but aren’t sure exactly how to proceed? Saving might seem to be an easy task but in reality if it is not planned for it is not as easy as you imagine because it does not come naturally. If you haven’t already done so, we advise that you first take a look at our post on how to develop a personal financial plan. Recall that the execution of the plan is just as important as the actual plan... more
Developing a personal financial plan
Vision without action is a daydream. Action without vision is a nightmare. This Japanese proverb is one of my favorites and when it comes to investing in the stock market, coming up with a personal financial plan is one of the most important steps. By developing a personal financial plan you can realistically save for retirement, set money aside for the unplanned, accumulate money for special expenses such as a new car, and simply put, invest more intelligently. Developing a financial plan is necessary because saving does not come naturally. It requires thought and if we want to meet our financial... more
Where is all the money going?
At one point in time we have all asked ourselves “but where is all the money going?”, “how is it possible that all of it is gone?”. It doesn’t matter how much or little you earn. What matters is having control. Controlling your finances is the key to financial success. You might think that rich and famous athletes and celebrities earning massive pay checks have little to worry about their finances but in reality several of them have made the headlines for their financial disasters.  Living a luxurious lifestyle, if not under control, can easily lead to financial disaster and bankruptcy.... more
The time value of money
One of the most important principles of personal finance is that money has a time value associated with it. A dollar received today is worth more than a dollar received in the future. This is because by investing the dollar you received today, you start earning interest on it. As mentioned in the post “The three key investing variables”, the longer the time frame of your investment program, the greater the power of compound interest. Because of the time value associated with money, you cannot compare amounts of money from two different periods of time... more

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