What is My Financial Status?

In planning you budget and your financial plans for the future you need to understand what your current financial status is. Set the correct amount of time as to do this properly, as you can not rush the planning and analysis stage of your financial planning and monitoring.

To determine your financial status there are 3 core stages.

The first stage is to take stock of your current budget. Your budget should be a balance sheet of income coming in and income going out. To get ahead you want to have more income coming in than going out, just surviving equal income coming in and going out and going backwards is less income coming in than what income is going out. Once you have established what is your current category you need to position your budget to getting ahead.

The second stage is to understand how the financial community has documented your financial history. This document is known as your credit file and is used by all prospective lenders to review and record any relevant financial information. Your credit file can potentially be used by any prospective employer, landlord and future spouse. Get a copy of your credit file and ensure that all records on your credit file are accurate. Your credit file will have financial score placed next to it based on the contents of your file, if your score is low you could find yourself in apposition if you need credit that it is hard to obtain and that you will be paying much higher interest rates.

Stage 3 is then to document all the information you have gained from your budget analysis and combine it with you credit file to understand what is your overall financial status.



Source by Tom Peters

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