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| A statement of your financial position on a given date. It includes your assets, your liabilities, and your wealth or net worth. |
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| Something that is borrowed / owed. |
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| Total assets - total liabilities. A measure of the level of your wealth determined by subtracting the level of your debt from the value of your assets. |
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| What an asset can be sold for. Not what it cost or what it will be worth in the future. |
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| Financial assets, such as bonds, mutual funds, or stock. |
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| Includes investments made by you or your employer with the purpose of saving for retirement. |
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| A physical asset, such as a house or car, as opposed to an investment. |
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| A listing of used cars, giving the average price a particular model in a particular year sells for. |
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| Consists of tangible assets, including all your possessions. |
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| When you owe more than your assets are worth. |
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| A statement that tells you exactly where your money comes from and where it went over a certain period of time. For personal use, they are prepared on a cash basis. |
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| An expenditure where you have discretion as to how much to spend. You are not obligated to pay, and it may vary from month to month. |
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| An expenditure where you are committing to the amount of spending. You are obligated to make this payment amount, and it is usually the same each month. |
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| A plan for controlling cash inflows and cash outflows. |
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| Aimed at determining whether you have enough liquidity to meet emergencies. The ratio should at least be 1.0, and preferably be higher than 2.0. MONETARY ASSETS / CURRENT LIABILITIES. |
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| Month's living expenses covered ratio |
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Definition
| Aimed at determining how many months of living expenses can be covered with your current monetary assets. Should be enough to cover 3 or fewer months of living expenses. MONETARY ASSETS / (ANNUAL LIVING EXPENSES / 12). |
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| Aimed at determining whether you have the ability to meet your debt obligations. TOTAL DEBT OR LIABILITIES / TOTAL ASSETS. |
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| Long-term debt coverage ratio |
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| Aimed at determining whether you have the ability to meet your long-term obligations. The ratio should be higher than at least 2.5. TOTAL INCOME AVAILABLE FOR LIVING EXPENSES / TOTAL LONG-TERM DEBT PAYMENTS. |
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| Aimed at determining how much you are saving. INCOME AVAILABLE FOR SAVINGS & INVESTMENTS / INCOME AVAILABLE FOR LIVING EXPENSES. |
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| A book or notebook set aside to record expenditures. |
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