Credit Repair Services and Information
Assessment of financial health
Money Management
Step 1 - Setting Goals
Step 2 - Collecting Facts and Figures
Step 3 - Assessment of Financial Health
Step 4 - Realistic Goals
Step 5 - Action Plan
Step 6 - Review and Assessment
Net Worth Assessment
Cash Flow Assessment
This step allows you to analyze your present financial situation
as determined in the previous step and enables you to start thinking about
solutions. The direction your money management will take depends to a large
degree on both steps 1 and 2. Whether you have a positive or negative net worth,
and whether your cash flow indicates a gain or loss at the end of the month,
has profound implications on how you will begin to manage your money. Are you
at a negative net worth? Access professional help today!
What you also must consider at this time is whether the
goals set out in step 1 are realistic when considered in light of your current
cash flow and financial position. If, for example, you have a short term goal of
saving $20,000 for a down payment on a house, yet you are carrying a $20,000
debt load on credit cards, your ability to save for that house will depend on the
speed at which you can first pay off what is a high interest debt. As well,
a decision about how quickly you want to pay off that debt must be made. If retirement
planning is a big priority, perhaps you want to set aside $25.00 each month
for retirement investing. All of these variables and many more must be considered
in assessing your financial health.
The primary goal of this step is to help you set
realistic goals and timeframes. Realistic is the most important concept. Analyze
your cash flow statement carefully. Did you forget to include your $20.00 monthly
magazine purchases? Did you neglect to include the cost of cigarettes, because
you plan to quit soon? Have you added up your monthly entertainment costs
and felt shock at how much you're spending on fast food? Are there other areas
where you can cut costs to pay down debt faster, or start investing sooner?
Take time with this step. Be completely honest with
yourself. Don't cut out costs that require you to change your entire way of life
until you actually make those changes. Always remember that your cash flow
statement is a picture of your current financial health. Your cash flow statement
will change as your lifestyle changes. Once you've made your financial health
assessment and moved on to the next steps, you may be on the road to changing
the look of your cash flow statement in significant ways.
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