Just updated and reviewed my finances today. I think it is useful to do a yearly personal financial review.
- Review the expenses for the year to see if one's spending habits need any adjustment.
- Review the income/investment for the year to look for opportunities that may have been missed, and/or cut or minimize losses/leaks.
- Update one's personal net worth to determine if one is on-track for retirement planning or needs to buck up otherwise.
- Plan for the major "to-do's" and their likely financial impact for the year ahead.
Several friends, who are/were professional personal financial advisors and/or insurance agents, ever mentioned to me that my habit of keeping track of my finances and reading about managing one's money is not common. This is reinforced upon me again this year as when my GNIE classmates occasionally brought up the issue of managing their personal finances. In fact, one of my Korean GNIE classmate SS felt that I "think like a man" given my interest in managing personal finances and investments.
I don't really have an explanation for my "uncommon" habit.
- Maybe because I grew up poor (working-class family), and growing up poor meant that some life experiences that were unpleasant have a higher tendency to happen (click here and here for examples). [E.g. Read this write-up by Sharon Claire. I too experienced similar stuff growing up, although I fought back at times and it did not lead me to become anorexic.]
- Or perhaps, my early exposure to money and understanding how it is necessary for providing the essentials in life (from my parents incessant quarrels over money while I was growing up) made me very resolute about making enough.
- Or perhaps, I wanted so much to be independent, since way back when I was only just a child.
- Or perhaps, I just enjoy mathematics and the satisfaction of knowing where I stand financially.
Anyway, I am very happy to get it done. Knowing where I stand financially gives me confidence to look forward to various changes/plans in 2013!