An asset is simply any item of value that you own. Assets have either current or future economic value, meaning it is worth something now or will be worth something in the future. This means they can be sold to settle debts or that they have the potential to produce income for you, either currently or in the future.

A liability is simply any debt or financial obligation you owe to another person or corporate entity, like a bank or credit union. ‘Liability’ can refer to any agreement, verbal or written, that has not yet been paid, and so it impacts your future financial position until it is paid off. 

These are all the ways that you have money coming to you on a daily, weekly, monthly, quarterly, or annual basis. These can include:

• Salaries (full-time or part-time)
• Side hustles/ entrepreneurial ventures
• Investment dividends, and more

Here is where you will list all of your recurring expenses. Without a clear picture of your recurring expenses, it can be difficult to create a plan to manage your finances effectively.

For non-monthly expenses, such as insurance premiums, calculate and record the amount of that expense for a month (e.g. An annual premium of $3,000 equates to $250 per month [$3,000 ÷ 12 m per month])

This list can include:

• Debt repayment (mortgage, loans, credit card payments)
• Household expenses (rent; electricity; water; gas; cable/internet subscriptions e.g. netflix; home insurance premiums; maintenance e.g. lawn care, housekeeping; repairs)
• Food and supplies (grocery, household supplies, dining out)
• Vehicle (gasoline, insurance, licensing, repairs)
• Personal (grooming, health, clothing, dry cleaning)
• Insurance (Life and Health)
• School fees and supplies
• Entertainment and Travel
• Giving (tithes, offerings, gifts)
• Other monthly payments (subscriptions, streaming services etc.)