Ever wonder if you are likely to meet your financial goals? With information available from multiple sources on how you should handle your finances, a simple personalized approached can still work best. By tracking your assets and monitoring their growth over time, you can easily project whether your assets are helping you reach your financial goals. Using a simple spreadsheet can help you stay on top of your finances and know exactly what assets are working for you, and where there is room for improvement.
Track and Record Assets
Step 1
Compile a list of your assets and record them in a spreadsheet. Record one asset per line going down the page, and leave one row free at the top of the page for column headings. Specifically list each asset, so there is no confusion when you open the spreadsheet in a month or several months from now to update the figures. For example, if you hold stocks, list each stock individually. Mutual funds, real-estate properties or other assets are also listed separately. By being specific, you will be able to see exactly what each asset is doing for you.
Step 2
Create additional columns for date of purchase, purchase price and time intervals. In your second column, record the date of each asset purchase. Next to this record the official purchase price of the asset, also called a cost base. You will then need to decide how often you are going to update the spreadsheet. Put dates on each of the columns, moving to the right, which align with the dates you will update the asset's current market value. Use official statements and receipts whenever possible to ensure accurate figures.
Step 3
Compute the growth of your assets over time. It is now time to determine how your assets are performing. To calculate your "Return on Investment," or ROI, take the current value, minus your cost base, divided by the cost base multiplied by 100. For example, if you purchased a stock at $10 and one year later, it is trading at $15, your ROI is 50 percent. This calculation is done in a separate column entitled "ROI."
Step 4
Maintain running totals of your asset growth for easy reference. Update the value of your assets at least once a year, and preferably quarterly. If you are unable to get a specific market value, such as on a real-estate property, use a researched estimate. This may include finding the price of a comparable property that recently sold.
Step 5
Graph your statistics. Visually seeing how each asset is doing over time will give you a much greater sense of which assets are really working for you and which are underperforming. Each asset can be graphed separately by selecting all the data in the row, and then clicking "Insert Line Chart." Depending on the spreadsheet used, the method for inserting a chart may vary slightly.
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Tips
- Keep your spreadsheet neat and organized. If you have held investments for a long period of time, and the spreadsheet is extending too far to the right, you can delete columns from multiple years ago and replace them with a yearly summary column. Record the yearly closing price in the summary column.
- If you notice an asset that is continually underperforming, consider selling the asset or discuss an alternative investment with your financial planner.
Writer Bio
Cory Mitchell has been a writer since 2007. His articles have been published by "Stock and Commodities" magazine and Forbes Digital. He is a Chartered Market Technician and a member of the Market Technicians Association and the Canadian Society of Technical Analysts. Mitchell holds a Bachelor of Management in finance from the University of Lethbridge.