Assessment financial situation is the very first steps we shall do before we start personal finance planning. This life management skill is very important as it will give us an overview of our current financial situation to help in personal finance planning for our financial goals.

Life Management Skill for personal finance – financial assessment by formulating balance sheets and income statement, then figure out the estimated current net worth:

Net worth value = Total Assets – Total liabilities

Cash in hand, fixed deposit account, vehicles, house, furniture, jeweler etc are under assets. The asset data also contains information of date acquired, current fair market value of the checking account like car or properties, retirement assets like EPF, all investments like stock as well as cash value of life insurance.


Liabilities include car loan, housing loan, study loan, credit card debit, tax liability etc. This liability data contains information on the date incurred, original amount, current balance, maturity date, and interest rate of any loans.

Last but not least, insurance information of insurance amount required need to determine for personal finance planning. We are advisable to list all the current insurance coverage and kept record of detail information of family members availing the life insurance.

For a better life management, a family normally having different types of insurance catering for different life needs; includes, medical insurance, auto insurance, property insurance, saving and investment planning.

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