August 19, 2022

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Run your family finances like a business

Question: I want to prioritize my family’s financial habits and start making smarter choices. Do you have any tips or strategies for family finances? 

A: The best advice we can give you is to start running your individual and family finances the same way you would a business. Most people don’t regard themselves as “businesses” – trying to generate a profit. Looking at your financial situation from this perspective may be helpful in determining where you might cut expenses, boost cash flow and generally improve your personal financial situation. It can be especially beneficial if you foresee a major financial commitment in your future, like buying a house, or starting an actual business. Here are some tips.

Tom Cooney with Wealth Dimensions

Examine your financials, Where an executive might reach for financial statements to get a read on the company’s standing, you can create or update a personal net worth statement. Essentially a monetary scorecard, a net worth statement shows where you stand financially and whether you are on track to meet your short term and long term goals.

You can calculate your net worth by summarizing the current value of all your assets, including cash and cash equivalents, brokerage account balances, retirement funds, real estate and other fixed assets and personal property. Then subtract your liabilities, including mortgages, personal loans, credit card balances and taxes due. The difference between the total value of your assets and your liabilities is your net worth.

https://www.cincinnati.com/story/money/2021/10/11/personal-finance-tips-run-your-family-finances-like-business/6089392001/