As a follow up to my previous article – ACHIEVING YOUR FINANCIAL GOALS THROUGH PLANNING AND LOANS- I decided to create this one. We can never over-emphasize the importance of making a good financial plan and that is the purpose of this article. Making a financial plan involves great concentration and dedication. Below are the ways you can create such a good plan.

CREATE A FINANCIAL JOURNAL

Ideas stored in the brain or mind is only there temporarily, emotions can hamper their shape and sizes. Writing these ideas down is a great way of removing the vague nature of a mind-stored idea. Get a paper or a note and write down your ideas. This gives it the right shape and size and helps you to easily nature them. By placing the journal where you can easily see it and pick it up to read help you concentrate on them and work towards it. But remember to read it daily and also remember to give it the SMART feature i.e. your ideas should be Specific, Measurable, Attainable, Realistic and Timely.

PRIORITIZE

Now that you have your list of goals, it’s time to prioritize them. Give them levels of importance on a scale of say 0 – 10 with 0 being the least important and 10 being the most important. After this create another list with this ordered importance. It should also be advised to give them a time bound or period; this helps it to be more specific and to pick up one goal at a time.

MAKE A BUDGET

It’s time to create a personal budget. Having a budget does not make you a poor man. The rich do have a budget else they would have run out of their resources. Warren Buffet bought his present house 50 years ago and he still cherishes it. It’s a 3-bedroom house with no wall and fence and he says it has all he needs in it. What is the message here? Live within your earnings and how what you want and not what the Jones have. And this is called planning or budgeting. It’s so important that even nations don’t do any spending without first having a budget of the financial year which it should run.

IMPLEMENTATION

After the budget creation comes implementing it. It is not enough to create a budget but to follow it up to the latter. The budget is a blue print of how your spending would be for the period running, so if you don’t follow it up you will be running the “red print” which will always put you in the red making you debt stricken. You can start a savings account, opening a mutual fund, buy a small real estate deal, or even invest in stocks. But whichever you choose to do, always seek the advice of a financial adviser.

REVIEW YOUR GOALS

Now that you have these plans running, you would need to periodically review your journal of prioritized goals or ideas. Are the processes you have set meeting the purpose of you planning. If no, then redefine your goals or implementation method(s).

REPEAT STEPS ABOVE

Next you have to be continually repeating the steps above and you will be on your way up.

If you have good communication skills, you might be ripe for having a financial planner career.

A financial planner helps both businesses and individuals to plan for their investments. One good thing about being a financial planner is, if you lose someone’s money – it’s not your money. You still stay in business even if every one of your clients were to go bankrupt. Isn’t that about as great as it can get?

It’s a lot like being a weatherman. People like to blame the weatherman when he’s said it was going to be sunny, even if it really rained afterwards; but does anybody ever fire the weatherman? No, they never do. People will always blame a downturn which caused all their money to go ‘south’ on ‘economic down-trends’, just as they blame tornadoes on ‘the weather’; they don’t blame either of those things on people. So, you might have been completely wrong, but you won’t get either fired or sued for saying whatever it was that you said. How many jobs can you be in where that’s the case?

One of the reasons for both of those cases is, everybody knows that in both cases random events really rule the world. In some cases we fool ourselves into thinking that random events don’t rule the world… but in the case of both the economy and the weather, we can be sure that it does.

Therefore, a financial planner career is a perfect place to be in such troubled times. Whatever you say, people will want to hear it; and, if it turns out that you weren’t right – people will just say, “Well, a lot of other people weren’t right, also.”

You’ll be using statistical software and spreadsheets, so it’ll be really easy to do. The computer will basically just give you the answers. Those are the answers that people will take to be firm facts, because they don’t have anything better to work with that that. Everybody knows that little is really understood about the intricacies of how the economy really works; so it gives a veneer of officialdom to your job which people will like. Whenever people get frightened, they need to have an illusion that things will get better; when, in reality, they always get better anyways – but they don’t know that because they never don’t do the things they do that give the illusion that they are working.

If you go to any company where they do such work, most will tell you, outright, that I’m right. They’ve found that it’s a lucrative place to be, and is a place where you can lose as much money for people as you lose without being blamed for it. The ‘economy’ will be the thing that’s blamed, instead. What a great job to get into, then? You get paid for just putting data into programs, following the instructions as are laid out by the software that people have made, and fitting that data into the system. Since it’s the best equations that have yet been developed to mimic economic trend, you can’t be blamed if it fails.

This is very clever, and nobody else but me are going to tell you about it. They’ll be saying all those words which seem to sound good, and seem to give the illusion that someone knows what they’re talking about; when they all really know that they don’t know what they’re talking about. You could see that those people didn’t know what they were talking about when they were on TV just after the market crash. They didn’t know what would happen, because this was all out of their realm. Yet, it didn’t matter that none of them knew what they were talking about. Whatever they said, whether it turned out to be true, or not, was solid gold to anybody that was listening.

Thus, a financial planner career would be the perfect career to get into at this time. You can’t be blamed if the economy fails, you will be well-sought after because everybody is afraid at the moment so they all need ‘professionals’ to tell them what to do, and if what you say doesn’t come true, they’ll just blame it on the economy, not on you.

Now you can go and read all those websites which will tell you the malarkey. Just remember where you heard the plain-and-simple truth.

What Are the Three Types of Financial Statements? Which One Suits My Firm Best?

Business owners will find out at some time in the business history, (usually early on!) that they require financial information to satisfy essentially two bodies – shareholders/management, and, secondly, lenders!

There are essentially 3 types of financial statements:

AuditedReview EngagementInternal

Audited Statements – Companies who require audited financial statements. Why does a company require an audited financial statement? Business owners quickly realize this type of statement comes with a very significantly higher cost. So why the need? The best way to describe the need is that there is an important interest in the company, and that interest comes from an owner /shareholder, or lender. The audited statements report to those two parties and validate that the auditor, an independent third party, is saying that the financial represent the true picture of the company, and if there are any serious inadequacies then those are pointed out.Any ‘ inadequacies’ relate to GAAP, which, stands for Generally Accepted Accounting Principles ‘. Let’s use a quick example. There are primarily two methods that corporations use to count and record inventory. If the company was using an alternative method, the auditor would point out that the GAAP is in effect being broken. That’s a quick simple example. We are most familiar with public companies requiring audited financial statements. That is because a public company has usually thousands of investors. They, 99% of the time, don’t get to meet management or see the company. They rely on the audited financial statement to reinforce the credibility of the financials. Audited statements are costly and time consuming to prepare, and require significant company and auditor inter-action. However the importance of the audited statement can’t be over emphasized.

Review Engagement Statements – This type of financials statement ranks 2nd in the hierarchy of financial statements. (Audited is # 1!). Review Engagement Statements are prepared by a 3rd party accountant; however they come with only 3 basic elements to them.

1. The accountant should have a ‘ reasonable knowledge of the company’2. His questions, comparisons, and discussions should provide an inference that the financial statements seem reasonable 3. The statements should be presented in a manner acceptable to GAAP ( even though individual accounts aren’t checked )

Internal Financial Statements – These are exactly what are inferred. They are financial statements prepared internally for management, or for monthly reporting to their bank. We can essentially say that management or the third party accountant simply collects information, summarizes it, and notes that information is somewhat restrictive in nature as it lacks the additional due diligence in Notice To Reader and Audited statements.

In summary, there are 3 times of financial statements. They are given various weight and significance based on who prepared them, and how, and under what standards of accounting competency. A start up firm might start its history with internal statements, as the company grows it would be required by lenders and other stakeholders to prepare Notice to Reader Statements. As the company grew very large, and went public perhaps the need to prepare Audited Financials would be a necessity.

Business owners and financial managers should continually be determining if the type of statement they currently prepare satisfies current needs, and management should also be looking at the next evolution in the company’s financial reporting needs.

If you are facing a financial crunch then go for the financial assistance for moms. Oh God! You won’t believe how difficult it is to manage your funds. I am a single parent and find it really hard to manage my funds. Single parenting is indeed a challenging job and calls for greater responsibility. But I was fortunate enough to get hold of a lucrative job and solve my problem. Initially I did face some trouble because I didn’t have a good degree at my hand. I had to stop my study midway chiefly because I didn’t have sufficient cash at my hand. But then, this cannot be the solution or I couldn’t forget my goals and desires chiefly for this reason.

I did take up much pain so as to come up with an effective solution and finally gathered information about the financial assistance for moms. In fact, a friend of mine had applied for these assistance programs earlier and she suggested to me to go for more than one grant. This indeed turned out to be a viable solution. I say this because, there were a number of people running for the same grant and as a result by applying for more than one grant I was pretty sure that I will be able to reap the benefits of one grant or the other.

There are a couple of instructions that I would like to pass onto you if you want to go for financial assistance for moms:

Apply for more than one scholarshipDo a good research Provide accurate information

Loan Modification Help – Step #1 – Learn How to Complete Your Financial Statement Correctly

Many homeowners make a big mistake when they apply for a loan modification-and that is why they are turned down for the help they so desperately need.  That mistake is not preparing their financial statement ahead of time-before disclosing all their information to their bank.  Why is this so important?  If you just blindly start spouting off your income, debts and assets-how do you know that you fit into the lender’s guidelines for approval?  Preparation is the key to success-follow these simple steps to make sure you have a fighting chance at approval.

Here’s how it works-your lender will ask you for a detailed accounting of your monthly income and expenses.  Based on what you provide, a decision will be made to either approve or deny your application for a loan modification.  Some banks take this information right over the telephone-others require that you submit your financial statements and income documentation for review before they make a decision.  Either way, it is critical that you have all of your information ready, fine tuned and acceptable before you start the process.

You need to pull out all of your monthly bills: utility bills, groceries, gasoline, insurance, etc.  List all of those on a piece of paper so that you have an accurate picture of how much you spend each month.  Now group the utilities all together, and arrive at a total.  Do the same for your other expenses.  Annual bills, like car insurance or homeowners insurance need to be divided by 12 months to arrive at the right figure.

Pull out your 2 most recent paystubs or other income documentation.  Calculate your gross monthly income and your net monthly income.  Make sure you note any other sources of income, like roommates, child support, alimony, disability, etc.  Arrive at your total gross monthly income and your total net monthly income-write that down.  Multiply your gross income by 31%-that figure represents your ideal target mortgage payment under the Obama loan modification plan.

Now begin filling out your financial statement form-you can use a good one provided in a resource guide for homeowners.  You will be able to see how much money you are short each month and why you cannot afford your current mortgage payment.  The goal of the loan workout is to modify your home loan to a payment that you can afford.  That is called your target payment.  You can use the Obama plan to match your target payment-2% interest rate for 40 years is a good starting point.

You may need to make some adjustments to your monthly bills to meet the disposable income requirement-you should have a couple hundred dollars left over after to pay the target payment and all of your other bills to be a good candidate.  That is why you need to work on your financials ahead of time-make any adjustments and make sure you fit into the approval criteria before you send in your application-it will help you avoid any costly mistakes.