Making progress each month is a great feeling. You can see the results and feel like it’s all worth the effort. This is incredibly energizing and motivating.
FYI, this is not me. It is however someone who put in the effort and you can obviously see the results. That is not always the case with your business and finances.
You’re running your business for probably multiple reasons and a lot of them are personal to you. But one of the reasons must be to earn a living and get ahead. Or at least survive comfortably and pay down your debt?
Unlike the guy above, seeing your results when you have multiple personal and business bank accounts, credit cards, debts owing to suppliers and the bank and money owed to you by your customers it can be impossible to know “what just happened?” at the end of the month
A body builder can see his muscles growing. You can’t see if your net wealth is growing when it’s made up of a patchwork quilt debits, credits, assets, liabilities and investments. Unless you do this….
Get all of your bank balances, asset values, and liabilities IN ONE PLACE!
Create a spreadsheet like the one above and call it your ‘Net Wealth Tracker’. Each column will represent one month.
Assets sit up the top and are POSITIVE (don’t change house and car values from month to month, it’s not worth the effort)
Liabilities go underneath and are NEGATIVE
Take screenshots on your phone of ALL your bank accounts at the end of the month (PERSONAL AND BUSINESS). Make sure you cover all your bank accounts, credit cards, and investments. Take them all on the same day (the actual day you take them is less important than doing them all at the same time).
Enter the numbers and add them all up. Compare this month to last month. How did you go?
Money flows to and from your personal and business accounts so it’s much easier and more meaningful to capture and track the HOLISTIC view of how you are doing.
The clarity and confidence this will bring to your life is well worth the effort. Unless you prove to yourself that you are doing OK with a report like this you will likely assume that is not the case. As you see money going out of your accounts in small amounts on a daily basis it’s tempting to worry.
Once the spreadsheet is up and running this should only take 10 to 20 mins of your time a month. The trick is to use your phone, capture multiple accounts for each screenshot and do it all at the same time. Then you will know for sure what progress you have made.
