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Organizing Your Finances: - Show Me MY Money: What You're Worth or * net * Worth

By Janet L. Hall

Benjamin Franklin once said, * Time is money *. I think he wanted one to add up how much time they spent on a particular task or job and how much money they might have been wasting.

I do an exercise with my clients to help them discover what their per minute worth is to enable them to see how much money they might be losing because they are disorganized. Such as, if you are doing a non-income producing activity for 15 minutes, you can see how your money is being spent!

It's a very simple calculation.
Your Per Minute Worth Calculation:
Yearly income divided by 52 weeks = weekly income
Weekly Income divided by 40 hours (or total hours you work per week) = hourly income
Hourly income divided by 60 = Your Per Minute Worth

Before you begin to OverHall and Balance your financial area, you need to find out your net worth, and your spending habits. This will help assist you later with your budget, payoffs, or long-term savings. It will also help in guiding you with such things as your protection, investment, income tax, retirement, and estate planning.

Your total net worth is your total assets (what you own or already have saved) minus your total liabilities (what you owe out). I'm not going to tell you this is as easy as figuring out your per minute worth because it's not! It will take time and a commitment from you to determine your net worth.

TIP: I have found the best time to do this exercise is when you are paying your bills. At that time you usually have the information needed to help you calculate your net worth. So, if it usually takes you an hour to pay your bills, tack on at least an extra hour this month for this exercise. For your convenience, print out and use the net worth form below. You will be writing in your totals for each line. For instance, if you have two savings accounts, total your balances first and then write in the total next to Savings Account.

Cash Reserve Totals-
Certificates of Deposit:
Checking Account:
Credit Union Account:
Money Market Account:
Savings Account:

Investment Totals-
Mutual Funds:

Personal Totals-

Real Estate Totals-
Second Home/Vacation Home:
Other Real Estate:



Short-term Debt Totals-
Credit Card Balances:
Current Bills Owed:
Loans w/ terms of six years or less:

Long-term Debt Totals-
Loans w/ terms of seven years or more:


Congratulations! You did it! * Drum roll * Please!

Now see if your net worth falls under A., B., or C. below, and see how you can begin to bring some balance back to this area of your life.

A. If your total net worth is half or less of your annual income or you have a negative number you need to REALLY * OverHall * and Balance your financial area!

~~ Pay off some/all debt
~~ Cut back on spending
~~ Stop charging
~~ Start a savings plan

B. If your total net worth is more than half your annual income but less than a few years' income you need to * OverHall * and Balance your financial area.

~~ If you're 40 or under and own a home, you're okay for now
~~ If you're 40 or over and you don't own a home:
`` Cut back on spending
`` Stop charging
`` Reduce debt
`` Increase your savings
`` Buy a home before retiring

C. If your total net worth is more than a few years' of your annual income,
CONGRATULATIONS! Keep doing what you've been doing!

Listed below are some questions to ask yourself now that you know and can
see what your net worth equals.

1. Do you have enough cash reserves to meet your needs?

2. Do you have enough protection to provide money for unforeseen emergencies
(we talked about this last issue)?

3. Do you have enough fixed assets (usually long-term; bonds are an example)
to provide or produce additional income?

4. Do you have enough equity assets (short or long-term; real estate and stocks are examples) for growth and income?

To answer those questions, you need to know what your family and your needs
and goals are and then plan how you are going to meet them.

Quick Tips to INCREASE Your Assets:

1. Maximize your 401(k) contribution
2. Start investing
3. Get automatic deduction/deposit from paycheck to savings each pay period.

Quick Tips to DECREASE Your Liabilities:

Credit Cards
1. If you have to use a credit card, use only one major card
2. Pay more than the minimum payment on the credit card with the highest interest rate
3. Stop charging to the highest interest rate credit card
4. Get rid of department store credit cards
5. Don't apply for anymore credit cards

1. Pay a little extra each month towards the PRINCIPAL of your mortgage payment
2. Drop your PMI (Private Mortgage Insurance) when your home equity exceeds
20% of your home's value (talk to your mortgage lender)
3. Refinance mortgage at a lower interest rate
4. Refinance mortgage at a lower interest rate AND finance for 15 or 20 years instead of the usual 30 years.
5. Pay half your monthly mortgage payment every two weeks (talk to your lender)

Smiles, not Piles,
Janet L. Hall

The Organizing Wizard, Janet L. Hall, is a Professional Organizer, Speaker, and Author. She is the owner of OverHall Consulting, and Organizing By Phone. Subscribe to her FREE organizing newsletter at or visit her web site at

Copyright 2000 by OverHall Consulting
P.O. Box 263, Port Republic, MD 20676
All Rights Reserved. Permission is granted to reproduce, copy, or distribute so long as this copyright notice and full information about contacting the author is attached.





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