When it comes to personal finance, complex laws of accountancy are not needed, since the frequency, volume, and number of transactions is quite less. For an individual, the process of making financial statements would serve to be more of a record-keeping procedure. Here, a personal financial statement template has been provided that can help you draft one yourself.
The art and science of bookkeeping and accountancy is a complex one, and is used widely in business to record transactions and assess and interpret them. The double entry system consists of complex mathematics, laws, and rules that make the system work smoothly. There are several personal financial statement drafts that can be depicted. However, instead of following complex procedures, following three financial statements is much easier and also quite resourceful.
- General Journal
- Cash Flow
- Balance Sheet
This is a three-fold system that you can implement on simple sheets of papers or even the excel sheets on your computer.
General Journal
The general journal is a two-fold statement which has two slabs. The first slab shall consist of all the expenditure and the second slab shall consist of all the income. When you have a personal financial statement, the problem is that the income that you receive tends to be relatively less, and periodic, unlike a business firm where the income exists on a daily basis. For example, the salary income can be shown only once a month. While making the statement, make columns with heads such as ‘$…’, ‘food’, ‘electricity’, ‘coffee’, etc. You can decide what the head of the column should say; there is no hard and fast rule for the same.
| General Journal for the Month of January | ||||||||||
| Expenditure | Fuel | Electricity | Food and Drink | Medical | Premiums of Insurance | Rent | Tax | Repairs | Phone bill | Other Expenses |
| $… | $… | $… | $… | $… | $… | $… | $… | $… | $… | |
| $… | $… | $… | $… | $… | $… | $… | $… | $… | $… | |
| Income | Salary | Interest | Returns on Investments | Returns from Insurance | Dividends and Returns from Stock | Money market Income | Bonus | Income from Real Estate | Income for Mutual Funds | Other income |
| $… | $… | $… | $… | $… | $… | $… | $… | $… | $… | |
| $… | $… | $… | $… | $… | $… | $… | $… | $… | $… | |
The last column and row can, of course, be the total expenditure and income of the month. Go on filling the columns and rows on a daily basis. Though this template does not contain the thirty or thirty-one days of the month, you may include them in your personal financial statement.
Cash Flow
Next off, the cash flow, where you can write the total expenditure and income for the month. Note the heads that you used in the general ledger. This goes as follows:
| Cash Flow for the Month of January | ||
| Total Expenditure | Fuel | $… |
| Electricity | $… | |
| Food and Drink | $… | |
| Medical | $… | |
| Premiums of Insurance | $… | |
| Rent | $… | |
| Tax | $… | |
| Repairs | $… | |
| Phone Bill | $… | |
| Other Expenses | $… | |
| Specifications | … | |
| Total | $… | |
| Total Income | Salary | $… |
| Interest | $… | |
| Returns on Investments | $… | |
| Returns from Insurance | $… | |
| Dividends and Returns from Stock | $… | |
| Money market Income | $… | |
| Bonus | $… | |
| Income from Real Estate | $… | |
| Income for Mutual Funds | $… | |
| Other income | $… | |
| Specifications | … | |
| Total | $… | |
Balance Sheet
The last personal financial statement is the balance sheet. This is basically a two column statement where the assets are written to the right, and the liabilities to the left. Note that some aspects of the cash flow and general journal affect the balance sheet. This statement can be made on a monthly or annual basis.
| Balance for the Month of January | |||
| Liabilities | Amt | Assets | Amt |
| Secured Loan | $… | Real Estate Market Value | $… |
| Unsecured Loan | $… | Bank Balance | $… |
| Credit Cards | $… | Cash Balance | $… |
| Due Installments | $… | Automobile market cost | $… |
| Due Premiums for Insurance | $… | Investment in Stocks | $… |
| Due Bills | $… | Insurance Accrual | $… |
| Bank Overdraft | $… | Mutual fund accrual | $… |
| Amount Payable in Stock Market | $… | Home related Personal Assets | $… |
| Amount Payable in Money Market | $… | Jewelry | $… |
| Other Liabilities | $… | Other Assets | $… |
| Total | $… | Total | $… |
You can use these personal financial statement templates as they are, or you can modify them as per your requirement. The totals of all the amounts will give you an overview of the income and expenditure that you incur every month.