Whats the best way to figure out you're personal finances?

Question

I would like to figure out a budget and, what my current investments are worth etc My chances of buying a home and what not.

Answer 1

On a sheet of paper, make two columns. In one, list all the bills you have each month (not including rent) and in the other, all the income. Add both columns separately. If the one with the debt is less than the one with the income, that's the amount you can invest in real estate.
Then call a lender and ask for "pre-approval". You'll receive a letter saying that you are pre-approved for a loan of a certain amount. Then go to Realtor.com and start looking in your price range. Check newspaper listings, too. When you find something and you're ready to make an offer, make it 10% below the asking price. Be ready to negotiate, but buy with your head rather than with your heart and ALWAYS get a home inspection.

Answer 2

Before figuring out, both experts and I, agree on one thing: find out how you're spending your money. It means, starting now, somehow logging how you spend your money. Whether you do that by saving up receipts, or recording the difference between your starting cash on hand and end of cash on hand such as over a period of a day, week, or month, or recording your credit card statements, it's up to you.

After that, you allocate. You'll discover $X spent on groceries, $Y spent on gasoline or transportation, and $Z spent on restaurants, movies, etc.

Do that a couple months in a row and you'll know what money you MUST spend to live on (for rent, car, groceries, clothes) and what other money you spend on things you don't need to purchase (movies, restaurants, etc). Allocate these into categories such as Utilities, Entertainment, Clothing, Transport, etc. The difference between your disposable after-tax income (i.e., the cash from your paycheck net of taxes) and important items like Utilities and Transport can be considered to be your Discretionary Income.

Now, enter your amounts in a spreadsheet, with months as columns and sum up your Discretionary Income over a theoretical year. This is about how you much could save if you were disciplined and/or had no disasters.

Place on the same spreadsheet the value of your investments. Yahoo Finance has great sources for valuation, if they're stocks. If your holdings comprise debt (Bonds, Treasuries, Notes, US Savings Bonds) then valuation is a little more complex but you can search how to value them. Place these investments grouped by category (Long-term versus Short-term, Debt vs Equity) alongside your budget.

Though rates are headed higher and lending requirements are rapidly tightening, I'd aim for a minimum 20% down payment if you can do it (because it eliminates escrow accounts and PMI) but failing that aim for 10%. So add up you liquid investments plus the sum of your Discretionary Income to where either 10-20% (of your dream/affordable home) places you in the future.

Then work towards that goal.

Answer 3

When you turn on your computer go to Yahoo, in the search box type in "budget" and you will find lots of info.