Financial Management

“The difference between a successful person and others is not a lack of strength, not a lack of knowledge, but rather a lack of will.”

– Vince Lombardi

Financial management is the cornerstone to achieving financial independence. It can determine the lifestyle you enjoy today and the lifestyle you will enjoy in retirement. Effectively managing your wealth will allow you to take control of your finances, so that you can achieve the goals you have.

The two most important financial management documents you need are a Net Worth and Cash Flow Statement (also known as a budget). Together they will help you understand how much you have, where it comes from and where it’s going.

To assist in the preparation of your Net Worth and Cash Flow Statements you will need an inventory of all your assets and liabilities along with an inventory of your income, expenses, and savings. It is this information that will form the basis of many of the strategies used to fill in any gaps in your financial position.

You should update this information annually or whenever there is a significant change to your income and/or expenses. By doing so, you will have the most up-to-date information whenever needed.

RECORD TYPE: Cash Flow Statement

Your Cash Flow Statement should be updated each year or whenever there is a material change to your income or expenses. Maintaining multiple years of Cash Flow Statements will provide greater insight into how your income and expenses change over time.

Suggested Action: Upload a copy of your Cash Flow Statement each year or whenever it is updated.

RECORD TYPE: Net Worth Statement

Your Net Worth Statement should be updated each year or whenever there is a material change to your assets or liabilities. Maintaining multiple years of Net Worth Statements will provide greater insight into how your assets and liabilities change over time.

Suggested Action: Upload a copy of your Net Worth Statement each year or whenever it is updated.

RECORD TYPE: Personal Property

It is a good financial practice to maintain records for all larger ticket personal property purchases such as vehicles, electronics, appliances, and furnishings. Having good records will help you get your asking price when you decide to sell personal property in the future.

Suggested Action: Upload a copy of all receipts and warranties for personal property purchases including all maintenance history.

RECORD TYPE: Real Estate

It is important to maintain copies of all real estate transactions, especially for any money you spend on renovations and upgrades. This may help to increase the market value when you sell the property, while also reducing capital gains tax payable on a cottage or rental property.

Suggested Action: Upload a copy of all purchase agreements, land titles, mortgage documents, property tax assessments and receipts for major improvements.

RECORD TYPE: Liabilities

Taking charge of your debt and making plans to reduce the cost of credit, will free up cash flow that can be used to achieve other goals you may have to enrich your life and grow your wealth.

Suggested Action: Upload copies of statements for any lines of credits, loans, credit cards and other debt obligations you may have.

RECORD TYPE: Other Assets

Your other assets include any asset that is not accounted for elsewhere and include personal loan agreements to family and friends, time shares, jewelry, art and collectables.

Suggested Action: Upload documentation for your other assets.

NEXT Steps

  • Download Resources
    Click the Resources link to download and print the various worksheets and templates applicable to your needs. Set aside some time over the next few days to complete each one. Remember to involve your partner/spouse should you have one.
  • Gather Documents
    Complete each worksheet or template and gather other statements and documents for each type of Record to be uploaded to this Tile.
  • Upload Documents
    Using a scanner or the Sidedrawer Mobile App, upload all statements and documents to the appropriate Record for secure storage and collaboration with your family and trusted advisors.
  • Add Collaborators
    From the Sidedrawer home screen, click on the Collaborator icon to add someone you wish to give access to one or more of your Records. Enter their email, name, and relationship to you, then select the Record and permissions to be granted.

Click here to print the Financial Management Document Checklist.

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