It’s time for the real work to begin. If you are starting over financially or trying to pull yourself out of a hole, this can be a daunting experience. It can be difficult to look at your mess honestly, facing the prospects of phone calls you will not want to make, writing letters or emails you will not want to send or taking responsibility for a position you have placed yourself in.
But as hard as it may seem, you can fix it!. Once you go through all of the steps listed, and get back on track, you will feel so much better about yourself. It truly is liberating and a real confidence builder.
You need to know where you are, so its time to organize.
1. All Statements (bank, credit card, car loans, mortgage, student loan, etc.)
- Gather all and paperclip each group together
- Is the information accurate?
2. All credit cards (pull them out of your wallet)
- Clip credit cards to statements
- Note balances, credit limits
- Look at what you buy each month, do you use what you have purchased?
- Look at recurring items, memberships? Do you use them?
- Are you willing to pay interest on stuff you don’t us
3. Your credit scores (one is enough to start with)
- If you have credit cards, most will have a free credit score tracker
- Highlight any derogatory items on your credit
4. Your assets (list them all)
- List equity in house, car, and misc items you may have
5. Your paycheck stub/details (what are your deductions)
- Anything on they you may not need
- Are you using the items that are being deducted
6. 401k info (old jobs and current, if any)
- Gather statements
- What is the return you have made in the past year?
7. Any investments
- Brokerage statements
- What is the return you have made in the past year
8. All Household Bills
- Cell phone, internet, cable, utilities, etc.
- Check all statement for accuracy,
- Any items that can be reduced?
This may also be a good time to take personal stock.
What habits are not serving me?
Overeating/eating out too much?
Drinking too much?
Shopping too much?
Buying stuff that you don’t need?
There are usually reasons things get out of control financially, and not everyone is fortunate enough to have people around to show how to handle finances, but this can be fixed. You will need to take stock of how you spend your money so starting looking now.
This will take time but if you are in it fully, it will get done. This just takes work.
Once you have all of this information together, it now time to run the numbers.
Step 2 Time to Set Up Your Book