THIS ISN’T TO POINT FINGERS OR MAKE ANYONE FEEL BAD
How often do you look at your financial reality?
This isn’t to point fingers or make anyone feel bad (including yourself). Use it as an opportunity to better your financial situation.
If you know your reality and your goals, you’ll recognize the next steps needed, or at least be able to plan them better.
WHAT SHOULD YOU LOOK AT?
Your financial reality is the truth of your entire situation. This includes the good, bad, and ugly. I’m talking about your assets, liabilities, income, and expenses.
Get honest with yourself. The only way to do this is to pull out all of your financial statements including your bank statements,
Credit card statements, investment statements, and bills. Lay it all out in front of you.
Now there’s no kidding yourself – it’s all there in black and white. Create a spreadsheet, write it down with pen and paper, or use an app. Do whatever makes you comfortable so you can see the reality of your financial situation.
ANSWER SOME HARD FINANCIAL QUESTIONS
Next, answer some questions about yourself.
- How did I get here?
- Why don’t I have any money saved?
- How much do I have saved for retirement? Do I live paycheck to paycheck? Why?
- Do I live on a budget or do I just wing it?
- Answering these questions will give you a better grasp of reality.
You’ll stop living in a fairytale, thinking everything is perfect and see the truth of your situation.
What steps are necessary to get yourself out of this?
WHAT ARE YOUR FINANCIAL GOALS?
Your financial goals coincide with your financial mindset and reality. Without a positive financial mindset, you can’t reach your goals, but without knowing your financial reality, you won’t have goals.
Sit down and create your financial goals. Be honest with yourself – don’t live in someone else’s reality or let someone else tell you what you ‘should’ do. The white picket fence and 2.5 kids aren’t real anymore. What do YOU want? That’s where you start with your goals. They should include some retirement savings and short-term, mid-term, and long-term goals, but every person’s goals appear different.
Don’t look to your neighbor, mom, sister, or friend for answers. The answers are in your own mind and heart; it’s up to you to find them.
DON’T BEAT YOURSELF UP
When you assess your financial reality, it shouldn’t make you feel bad. Let it empower you.
The more information you have, the better choices you can make. You’ll understand the reality of your situation and how close (or far) you are to achieving your goals.
Are you ready to see your financial reality? It’s time to let it light the way to financial freedom, whatever that looks like for you. But unless you get honest with yourself and look at the cold, hard facts, you won’t know your true financial reality.