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Do You Have a Personal Balance Sheet?

Posted on April 11, 2022 by

Margaret Amsden

Margaret Amsden

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A personal balance sheet provides an overall snapshot of your wealth at a specific period in time. It is a summary of your assets (what you own) and your liabilities (what you owe). A personal balance sheet results in an assessment of your net worth (what you own minus what you owe). 

If you are a business owner, a balance sheet can help you manage your business by identifying concentrations of certain assets, and when you might have too much of one thing or not enough of another to run your business. 

 When applied to an individual or family, a personal balance sheet can illustrate if you are on track to accomplish your goals, including: 

  • Paying off your debt 
  • Saving for retirement 
  • Building a legacy to leave to your heirs 

 A personal balance sheet helps determine how much you are worth and if you are headed in the direction you have set for yourself. It is sometimes referred to as a statement of financial position because it gives you a better idea of your total financial picture.  

 It is different than a budget which is really meant to identify what your income and expenses are and how you afford day-to-day living costs. Instead, a personal balance sheet lists out all of the big picture things you own and owe, and is not focused on what you are spending on a daily basis.   

How to Build a Personal Balance Sheet  

Building a personal balance sheet may take a bit of time but it’s worth the effort. Here’s how to do it.  

  • Gather your financial documents including: 
    • Bank and investment statements 
    • Certificates of Deposit 
    • Retirement accounts (401k statements, IRA statements, etc.)  
  • Create a list of other assets such as: 
    • The value of your home 
    • Other real estate 
    • Cars 
    • Jewelry  
    • Heirlooms 
  • Create a list of your liabilities, which is the money you owe to another person or a financial institution, including: 
    • Credit card debt 
    • Student loan debt 
    • Car loans 
    • Mortgages 
    • Personal loans
    • Medical debt 

Now it is time to assess your balance sheet. If you have everything listed out, you can easily see the total of your assets (what you own) and your liabilities (what you owe). By subtracting the liabilities from the assets, you will be able to see your net worth.  

Finally, schedule a reminder to update your balance sheet regularly. That way you’ll always have the up-to-date information you need to see if you’re on track to accomplish your goals. 

Continue the Conversation

If you have questions about creating a personal balance sheet or other ways to manage your wealth, we can help. Contact us today to learn more. 

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Margaret Amsden


Margaret leads the firm’s private client services group as the point person for individual, estate and succession planning tax strategies.

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