I’ve mentioned before that I started a Financials Journal this year. It’s a journal in which I record weekly, monthly, quarterly, and yearly financial information, as well as explore my past, present, and (possible) future financial things. I decided to share the journal with you here on the site, so you can get an idea about what I’m doing, as it is going to be a huge part of my success story.
I want to track all income and asset information in one place, as well as expenses. I’m showing pages that I haven’t filled out yet because, to me, financials are private. If I can start to feel more comfortable showing this information in the future, then I will revisit this post with you.
First, I wanted a journal that would hold up to a lot of use. It had to be sturdy. I went to Wal-Mart and looked around at what they had knowing I wanted something nice, but I did not want to spend too much. I was lucky to find this hard-cover notebook in the clearance aisle for only $3.00! What a deal!
As you can see, it’s a thick notebook. It is 6.5″x8.5″, and has 340 lined pages. A good size, and it will hold plenty of data. There is even a ribbon bookmark to hold my place.
I wanted to start the financials journal by providing some basic information, so the front of the book has:
- I started to prep my financials journal last year. It took some time, because I really wanted to get down to what my feelings are toward this topic and that of money in general. The information on the first page mentions two important books. One is by Bari Tessler, and it is amazing. The book is called The Art of Money: A Life-Changing Guide to Financial Happiness. The other was written by David Bach, of whom I am a huge fan. This book is called Smart Women Finish Rich. What a title! I’m still working through the accompanying workbook, and am learning so much. If you only read two financial books, these should be the ones.
- Bari mentions Intrinsic Assets, and that’s what the second page is about. This is about the gifts you bring to the world. I included things like being a good story-teller, my love of helping others, and my ability to live frugally. These and the other things on my list are who I am. They are assets, even though they do not have anything to do with finances. I think it's important to look at the entirety of who we are when we set financial and other systems up. Click To Tweet
- The third page is just definitions for what things mean. For instance, my Inner Peace expense has to do with my religion and Fashionista! is simply the clothes that I buy. Bari suggested coming up with terms and phrases that would make things seem more fun – or at least less stressful. I took her advice and included my taxes under Helping Others, which helps it to feel less daunting, and household expenses go under the heading Home Sweet Home. It sure does help me to feel less stressed when I think about things under those terms.
Next I wrote out my Money Legacy. Again, Bari Tessler gave me much to ponder. I started with the legacy I received, which had to do with me being incredibly honest with myself about how my parents and others in my life shaped my feelings and beliefs around money. Some of it wasn’t pretty, but I was able to pinpoint why I have some of the issues I have so that I can work on things. I worked out what beliefs and practices have served me, and what things have not. I decided what things I needed to release to make room for my new money practices, and thought real hard about what lessons I learned regarding money that I’m most grateful for. I even figured out what money wisdom I want to pass on to my children and theirs. I now know what is working for me, and have begun the money shame healing process so I can move forward. It was a lot to cover, which is why I gave myself last year to really focus and work through each question and suggestion.
Then I set up my weekly two-page spread.
The first page is my Income and asset page. Each week I begin with this page, entering each type of income on its own line and then moving on to assets.
For income, I have The Inn (With lines for Paycheck, Choice Benefits, and Other Benefits.), as well as Creative Endeavors (my writing and blogging income!) and Money Gifts. Under assets, I included a couple of things I am starting this year. The asset column includes: Savings Account, Retirement Fund, and Investments, among other things.
Midway on that page is the heading Types/Explanations. This is where I will note anything unusual, such as a new investment or why a particular expense was so high.
And the expense page is just that. The main headings for the page are: Taking Care of Me, Home Sweet Home, Helping Others, Gifting, Having Fun!, Creative Endeavors, Keeping in Touch, Things Happen, Going Places, and Wrapping it Up! Notable here are the Things Happen and the Wrapping it Up! categories.
They really do. There may be an emergency, such as someone being hospitalized or losing the power for a week. These are not normal events in my life, but they can certainly drive up my expenses. I’ll need to be able to keep track of what happened and how much it cost me. Once the total amount spent is recorded on the expense page, I’ll go back to the income/asset page and provide an explanation of what went down and why I had to spend so much.
Wrapping it Up!
For me, this is about debt reduction due to a medical issue I had a few years back. That is where my debts come from, and I want to be able to start paying them down while I start saving money. Once the debts are paid down, I will have even more for savings.
My Monthly Review looks exactly the same as my weekly two page spread. All I’m doing is going back and adding up every Income, Asset, and Expense for the entire month, and entering those figures in the correct spot.
The Quarterly Review is the same, using the sums of the previous three monthly totals into the appropriate places. The difference is the second two-page spread.
This is where I ask some important questions:
- Am I being true to my frugal self while allowing myself to have more fun and get what I need? (I have a habit of going without. I had to do this so much when the girls were growing up that I’m just used to it. I deserve to replace worn-out clothing when needed, and should be able to replace the DVD player if it breaks. The latter happened recently, and the internal struggle was real. I finally let myself do it, and I’m happy I did. I rarely go to the movies, and I get most DVD’s for less than a dollar used. It’s okay for me to have this indulgence. Also, I deserve to let loose and have some fun once-in-a-while, and I’m learning to do that a little more often.)
- Am I using my Intrinsic Assets? (Yes! Example: So far this year I’m writing a series of novellas, I helped out a friend in need, and I donated money to an important cause.)
- Am I growing my assets in a way that is important to me right now and/or to my future?
- Do I feel like I’ve worked toward an important financial goal this quarter?
- What important financial goals do I want to work on in the next quarter?
As for the yearly review, I will again use the basic two-page spread for Income/Assets and Expenses, pulling together the totals from each quarter of the year. I haven’t come up with my end of year questions yet, but I am working on them.
As you can see, I put a lot into the Financials Journal. I’m expecting it to help me get things in order, pay off debts, and save for my future. Once debts are paid off, I can start saving substantially more. At that point I expect to continue building my retirement fund and investments, as well as the general savings account that will be earmarked for my future house. I also want an emergency fund, and a fund for travels. Those are important to me. The savings right now is to get me into a one-bedroom or studio apartment, and out of the room I rent.
Activity: If you haven’t done so already, get out your planning notebook and brainstorm the design of your own journal or binder for financials. Read a book or two, then begin the process of setting things up. If you have debt and no savings, don’t be hard on yourself. My daughters are both in their 20’s and this is where I am starting. All we can do, is the best we can do.