These days, you do not need to hire the services of an accountant to analyze your finances. You can do this by yourself by using a personal financial statement template. This template comes in two forms-the balance sheet and the income statement. You should fill out both forms to have a more detailed analysis of your finances.
It is also important to have all the information that you will need to fill out your personal financial statement template such as your salary, assets, liabilities, and expenses.
What are the benefits that you can get from making a financial statement? Here are some of the benefits.
• First, you will know your current financial standing in terms of figures. You will know if your income covers your expenses well and if you have more assets than liabilities. These factors will determine your present financial standing. And because of this, you can easily predict what will happen in the future or you can also set goals based on the results.
• If you are planning to start your own business, of course you need to have a capital. And to get the necessary capital, you need to apply for a loan from a bank or lender. These financial institutions would want to know more about your capacity to pay and they will ask for your financial statements. If they can see that you are managing your finances well, they will surely approve your loan application.
• Knowing how you are doing financially will also give you peace of mind. If you are not doing so well, you can think of solutions by looking at your statements. But if you are doing more than okay, you can continue doing what you are doing.