Are you afraid to face your financial reality?
Tuesday, 18 June 2013 14:17


Many people spend hours tossing and turning at night thinking about their finances. These same people spend many of their daytime hours also worrying about their finances. This leads to a feeling of overwhelm and outright fear.

If you are one of these people that are pre-occupied with their financial problems, I would like to encourage you to redirect the time you spend worrying into a more constructive use of your time. The easiest way to feel more peaceful about your financial situation is to face it head on. Part of the reason for worry is based on confusion and a feeling of helplessness. If you continue to just worry and put your head in the sand, things will only get more out of control (causing relationship problems, health problems and other problems in your life).

If you can take the first step to understand your finances, this will go a long way to help you take control and make a plan of action. The first thing you need to do is clear some time in your schedule to actually come to terms with your finances. This means doing a “report card” of your assets and debts to create your net worth statement.

While this in itself can seem to be overwhelming, it is really not difficult to do and will then provide you with a baseline of where you are and where you would like to be. You can do this handwritten or on a computer (whichever makes you more comfortable). List all of your assets and beside them list their value. This would include any real estate, cars, equipment, gear, etc. that you own. List each item separately and allocate a fair “market value” for it. In other words, what it is worth if you sold it today. Once completed, total your assets.

Next you will list all your liabilities (what you owe). For instance, if you have listed a car as an asset and you have a loan for it, list car loan and beside it list the current balance on your loan. Include any money you owe including credit cards, unpaid bills, loans from friends and family. Once completed, total your liabilities.

The final step is to subtract your liabilities from your assets, which gives you your net-worth (remember this is not self-worth – it is simply a snapshot of where you are financially today). You will see that you either have a positive net worth (more assets than liabilities) or a negative net worth (you owe more than you own).

You might discover that your financial situation is not as bad as you thought it was, or it is worse. Either way, you will know the “truth” and be able to make plans based on reality and not worry.

For more details on determining your net worth please refer to “Week Three” in my Financial Fitness Books for Beginners (your 12 week training program).

In next week’s blog, I’ll talk about how you can take action now that you know where you are. This will include dealing with your creditors, who you will find to be extremely receptive to you, if you take the initiative to contact them (and I’ll give you tips and suggestions on how to do this).

I welcome emails from my readers asking financial questions on how to manage their money (my goal is to help you manage what you have and maximize your peace of mind while learning how to earn and save more in everyday life). I do not offer advanced investment advice. Looking forward to hearing from you either with a question or a suggestion for a blog topic at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Diana Young

#1 Amazon best-selling author www.financialfitnessbooks.com