6 Aug 2009

Financial statements

I'm about to round up reading Rich Dad's Prophecy, another recommended reading from the Rich Dad series. Mind boggling. Funny how a book written in 2002 is addressing a lot of the issues we are facing today!

I promised myself to always make at least 2 action points from every book I read and work on acting them out. It doesn't matter how small, change in the right direction is always a good thing. I'm working on my financial statement at present. This comprises of an income statement and a balance sheet. I've never liked accounting but Robert Kiyosaki in his book emphasises the need for financial literacy and an understanding of basic accounting for one to succeed in wealth creation goals.

Financial statements lets us know where we are on our journey, the numbers tell the truth and sometimes provide a necessary 'kick in the pants' to enable us strive to achieve our goals. If one does not know their present location, it might be a bit difficult for someone else to give you directions.

Both the income statement and the balance sheet show how much money is coming in and also how it is going out, one way or the other money must flow. The income statement shows how much of the money 'in-come' comes from your job or your assets, dividends, real estate or business and also how much is going out in expenses.

The Bible tells us to take care to know the condition of our flocks, I don't see anyway of explaining this any better. We will never be rich until we make more, much more than we spend, we will never be rich if we cannot say NO to some things. I'm looking at my liability column and assessing whether the things in my bad debt were really worth it! I'm lucky enough not to be paying interest but I must develop discipline in my spending habits if I am to succeed?

What do your numbers tell you? Buoyant, struggling or drowning, you'll never know if you don't face it.

Till next time, I leave you with the words of Albert Einstein that "to solve problems we need to go to a higher level above which the problems were created" to be financially free we have to go higher and yes we can!

3 comments:

Daveda said...

Hi there, I popped over here from jhazmyns blog and I wanted to say hello.

This is what I love about grace, even when it comes to finances, He (Jesus) gives us the ability and power to get out of mistakes...debt, bad choices, etc. and He gives us the wisdom to learn how to avoid going down that road again!

I really enjoyed your post!
and, It is nice "meeting" you. Please stop by and "meet" me sometime, too.

Believer said...

@daveda: Thanks for your comment. That's so true, remain blessed

Daveda said...

Thanks so much for coming by Grace Talk. I look forward to getting you better.