Snap A Shot: What’s Your Financial Picture?

by Ray’Chel Wilson

Does the topic of money make your head dizzy? The easiest way to approach your money goals (hello New Year resolutions) is to start with organization. In the financial literacy space, we like to call this your “financial snapshot” or “financial picture.” Organizing your finances in this way proves to decrease stress and increases your ability to achieve financial goals.

What Makes A Financial Picture?

Step by step, organize the following:

  • Assets: What is the monetary value of your assets?

    • As defined by Personal Finance Crash Course: What They Didn’t Teach you in School, assets are anything owned that has a value that can increase or decrease.

    • Assets can be converted to money (for example: real estate, gold, luxury goods, diamonds, cars, bank accounts, cash under your mattress, etc.).

    • My total dollar amount of assets is: ____________.

  • Income: How much total income do you bring in?

    • Your income is how money flows into your life. This can be from hourly jobs, salary, side hustles, or any other way money flows in.

    • My total monthly/annual income is: ____________.

  • Expenses (essentials, entertainment) (monthly)

    • Your expenses show how money flows out of your life. This can be split into three categories:

      • Needs (rent/mortgage, daycare, health items, gas, groceries, health/life/auto insurance, and other life essentials)

      • Wants (dining out, subscriptions, and other luxuries)

      • Saving (emergency savings, investing, retirement, or other goal-based savings)

    • My total monthly/annual expenses are:  ____________.

  • Debt

    • This consists of your auto loans, home loans, credit card debt, student loan debt, credit card debt, collections, or any other obligations to pay back people or organizations.

    • My total monthly/annual debt is: ____________.

I Have My Picture…What’s Next?

Great! You’ve organized your financial picture. Because a picture tells a thousand words, ask yourself:

  1. What does this picture tell me about my financial situation?

    1. No need to feel shame! It can sometimes be difficult to look at our money flow. Take this as an objective starting point on your personal finance & wealth-building journey.

  2. Do I have more expenses than income?

    1. If so, find ways to decrease your expenses (especially in the wants category) and/or increase your income (creating digital products, teaching a skill, selling a product, or other side hustles.

  3. Do I have more income than expenses?

    1. Awesome! This is the time to save and invest. What does your future self need? Make a saving or investing goal to provide your future self with what you need.

  4. What do I need to make these changes?

    1. Whether it be a friend who is holding you accountable, a financial coach, or a financial advisor, there are individuals who can help you stick to improving your financial picture.

Understanding where you are can help you map out where you want to go! Use this financial picture as a motivator! In the future, you’ll be so proud of how far you’ve grown.

Stay tuned for the next article to always better your money moves.

Affirm: I understand my money flow. I increase my money flow. Money flows to me abundantly.

Ray’Chel Wilson, CFEI®, a Toledo native, is the author of the Black Wealth Freedom series and CEO of Raise the Bar Investments, all things minority-friendly personal finance, #ForOurLastNames. Ray’Chel is an advisory board member of the Phe’Be Foundation, a Cleveland-based nonprofit fighting financial illiteracy across age ranges.