Understanding Personal Financial Statements

Understanding Personal Financial Statements CEO SERIES - WRITTEN BY MELVIN KEY CEO MVP PROTECTIVE SERVICES, LLC

THE PERSONAL FINANCIAL STATEMENT

• What’s a Personal Financial Statement• Why do I need one• What’s on a Personal Financial Statement• What are Assets• What are Liabilities• How to determine my Net Worth

The Personal Financial Statement is a document outlining an individual's financial position at a given point in time.

Financial Statements typically include:

• General information about the individual, such as name and address

• A breakdown of their total assets and liabilities.

So What’s This Personal Financial Statement All About?

What Are Personal Financial Statements Used for?• PFS are most often used when an individual is applying

for credit such as loans or a mortgage• The statements allow credit officers to easily gain

perspective into the applicant's financial situation in order to make an informed credit decision.

What’s Are Assets? An asset is anything of value that can be converted into cash. Assets are owned by individuals, businesses and governments.

What Are Liabilities

Financial obligations for which an individual is responsible and which may be satisfied out of his or her assets.

How Do I Determine My Net Worth

• Add up your assets

Step 1 Title

• Add up your liabilities

Step 2 Title • Subtract your

liabilities from your assets

• To get you net worth

Step 3 Title

What Is Net Worth

Net worth (sometimes called net or wealth) is the total assets minus total outside liabilities of an individual or a company. Net worth is used in personal finance for an individual's net economic position. Put another way, net worth is any asset owned minus any debt owed.

Credits and Resources Financial Statement - http://www.investopedia.com/terms/p/personal-financial-statement.aspAssets - http://www.investopedia.com/ask/answers/12/what-is-an-asset.aspLiabilities - http://www.businessdictionary.com/definition/personal-liability.html

Net worth - http://www.mybudget360.com/the-average-net-worth-by-age-real-estate-boost-housing-net-worth/Financial Statement Form - https://www.sba.gov/managing-business/forms/small-business-forms/financial-assistance-forms/personal-financial-statement

Personal Financial StatementsPresentation created by Melvin E. Key – CEO and Business Development Coach © 2017 All Rights Reserved

Contact: Twitter: @Security_Guy_DC Email: ceo@mvpprotectiveservices.com