You’re walking a wonderful new path of financial self-awareness and responsibility.  You’ve taken two very important steps on this journey.  Guest Blogger Steven Girard is back with the next steps that will empower you with a new perspective on reaching your goals.

Steven Girard, President, Northstar Financial Companies, Inc.

Now that you’ve determined what you want, it’s time to create two very important documents:  your Personal Net Worth Statement and your Budget.

Take a nice deep breath.  I promise these are not as difficult as they sound.  We are just determining what you currently have to fund your goals (Net Worth) and what you may be able to save moving forward (Budget).

Your Personal Net Worth Statement is an accounting of the things you own and the things you owe.  Northstar Financial has a comprehensive, yet easy to use Net Worth Statement and Budget template that can help you get through this process painlessly.

Gather all of your statements for any account that hold assets (checking, savings, money market accounts) and all the statements you have for outstanding debts.  On the asset side start with your cash, then your investments (stocks, bonds, mutual funds, ETF’s), then hard assets like the value of any real estate you own and any other asset you feel you could liquidate if needed (gold coins, collectibles, etc).  On the debit side write down the balances of each of your debts;  mortgages, home equity lines of credit, credit cards, car loans, student loans and personal loans.

Now tally them up.  Then subtract the debit number from the asset number.  You now have your Personal Net Worth.

On a new sheet of paper start examining your Budget.  We are mainly concerned with your ability to pay your ongoing expenses and what you have left for saving.  Pull out your last pay stub, or if your income is expected to remain the same this year, pull out last year’s W-2.  Write down any other sources of income that you can reasonably expect (bonuses if the probability is high, rental income, dividend income, and so on.)  Add those figures together.

On a separate column write down each expense you pay monthly (mortgage, credit card payments, student loan payments, car loan payments, food, utilities, gas, insurances, entertainment, etc).  If something is an annual or semi annual bill, break it down by month.  If something is weekly like food, average it into a monthly expense.  Subtract the expenses from the income.  Are you left with money or are there more expenses than income?

For many this can be a stressful exercise.  When you finalize these documents you may wind up feeling that you don’t have enough saved and don’t have the ability to save much more.  Don’t despair.  Reaching your goals is a journey and you have to take the first steps.  While the goal may initially feel unachievable, you will gain financial momentum the longer you stick to your Personal Plan Of Action.

That which feels so far away quickly becomes attainable.  It just takes time and the mindset that you CAN do it versus limiting yourself with fear-based choices that you may have made in the past.  The key here is to remember that your Personal Net Worth Statement and Budget are a picture of your here and now.  They are not a prophecy of what is to come.  What is to come is entirely in your control.  Have faith in your ability to achieve your goals and the determination to do the things that need to be done.

Congratulations!  You have reached the end of the second stage.  You have now declared what you desire for your life, you have made a commitment to those desires through written goals, you have quantified what it will take to achieve those goals, and you have done an accounting of your current financial picture in order to see what assets you have and your capacity for saving.

In two very simple steps you have gone from a blind financial existence to living a financially conscious life.  This process empowers you to step out of your past patterns and into a healthier relationship with money.  Knowledge is power and you have taken the right steps to organize that knowledge making you ready to strategize, act and implement.

Steven B Girard is the President of Northstar Financial Companies, Inc., and the Principal of the  Registered Investment Advisor firm.  With over 18 years of financial planning experience, he believes that financial planning is the key to achieving a life lived well.  He is responsible for the development and institution of Northstar Financial Companies, Inc., its overall philosophy, and financial planning strategies.  Email:

Securities offered through Registered Representatives of Cambridge Investment Research, Member FINRA/SIPC. Advisory services offered through Northstar Financial Companies, Inc. a Registered Investment Advisor. NFC and Cambridge are not affiliated.

Northstar Financial Companies, Inc.
1100 E. Hector St. Ste 399,
Conshohocken PA 19428