Evaluation and Appraisal of your Personal Financial Year

 

  The year will soon be out and done with, A time of the year when establishments and Organizations do an appraisal of how they have performed against their outlook at the beginning of the year. This is necessary to put into perspective what needs to be improved upon and what needs to be jettisoned.

In the same vein, we need to carry out personal evaluation and appraisals of how we have managed our finances during the period under review in this case a Year. I know you are thinking it will be an Apulian task given that the needed comprehensive information are not available for adequate evaluation and appraisal. If this is the case, then some adjustments have to be made in the coming year.

All your income and expenditure needs to be recorded, by having a complete and right transaction narration as much as possible. For you to achieve much with the income you earn, you need to block leakages and this leakages can only be identified by doing a thorough and sincere evaluation and appraisals.

      Some important tools are necessary for the evaluation and Appraisal process, and this are not limited to:

Bank Statement (YTD- Year to Date): This can be gotten from your internet banking or from the monthly Bank statement sent to you at the end of each month during the year.

 Financial Journal (The book in which you record your financial transactions): if this is not readily available you can use the narrations from the statement and rely on remembering some of the transactions on the Bank statement. The challenge will be in tracing transactions that did not pass through your Bank account. Which might form large portion of the expenses.

You need to ask yourself some sincere Personal Finance question about your expense and Income:

From your analysis, frequent expenses will pop up. There is a need to evaluate and plan a reduction of frequent expenses or find a better way of managing them. Example is that you might want to be buying your monthly provisions in bulk as against buying retail as this will save some cost.

From your appraisal, allocate yourself into your category of living with upmost sincerity as you do not need to deceive yourself. You are either LAI (Living above your income), LWI (Living within your income) or LBI (Living below your income). Appraise your savings and investment methodology and be determined to improve on it, if necessary, aim to do better in the next year.

Everyone needs a better personal finance management in the coming year. And this is dependent on two major factors: either you increase your income, you reduce your expenses or you do both.  Plan towards genuine means of increasing your income and reducing expense. Remember the natural law of what you sow you eventually reap, do good and good will come to you eventually.

Happy holidays from your personal finance coach Babat. I hope you have being seeing our short Insta videos on our Instagram handle @personalfinanacewithbabat.