Hey guys, my name is Sarah Nourse and welcome to the Money Confident Club where my goal is to help you confidently manage, plan, and invest your money. In today's video we are talking about seven personal finance numbers that I track every single month. [Upbeat music] The first number that I track is my income. This is obviously quite straightforward if you make a steady regular paycheck, but I know a lot of us out there have irrregular incomes and it can be a bit more tricky to actually understand how much money you are bringing in every single month. So if your income is irregular or you have various streams of income, you definitely want to track how much you're bringing in every single month. So, you know exactly what you're working with. The second number that I track are my monthly expenses. And when I track my expenses, I always break them down into fixed expenses and variable expenses. We all have our fixed expenses or what I like to call my overhead expenses. And this is basically things that you can not change every single month. That's your rent, your health insurance, your cell phone plan, and things like that. Then your variable expenses are things like, you know, your grocery budget, if that fluctuates, entertainment, clothing, and things like that. Tracking your fixed expenses is quite easy because they don't really fluctuate every single month. It's more the variable expenses that you need to get a handle on. If you have no idea what your variable expenditure is, every single month, a good thing that you can do is just start tracking it, going forward, track it for a few months to see where you're at, or if you're really anxious to get started, you can kind of go back and look at your bank statements from previous months to see where you're starting at. It's really important that you understand your monthly expenditure because it's only when you have a buffer between your income and your expenses that you can start to get ahead with your money. You have to give yourself that buffer - that margin. So you can do something with your money instead of just consuming it. Third number that I track is my monthly tax obligation. So if you did not know, I actually live in Switzerland. And in Switzerland, when you get paid, even if you have a regular, salaried, full-time job, they do not take taxes out of your paycheck. They will take out social security and certain retirement contributions that you opt into, but they will not take out like your federal, state and city taxes. Here in Switzerland - your tax obligations are also your responsibility to track and pay in yourself. I have an accountant that I work with and I provide her with our estimated household income for the year. And she will send me back a report with a breakdown in our estimated tax obligation for the year. And then I take that number divided out by 12 and start making sure that I am saving for that every single month. So this is something that's really, really important for us to track. Otherwise at the end of the year, you're going to end up with a massive tax bill to pay. So every month I'm ensuring that I am setting aside the proper amount of money in a savings account. And then I pay that into the government quarterly. So then at the end of the year, they see how much I paid in and they run the numbers to see if there's anything that I owe or if I paid in too much. And then they will send you either some money back or they will send you an additional bill. Even if you live in a country where they take out your taxes through payroll deduction. I think it's really important that you get a general understanding of what your annual tax obligations actually are. So you can ensure that you're paying in the right amount. So if it's incorrect, you can adjust that with the HR office and make sure that you're just paying in the correct amount, not too much and not too little. Before I get into the next point I want to thank Skillshare for sponsoring today's video. Skillshare is an online learning community with thousands of inspiring classes for creative and curious people. Skillshare is my favorite place to explore new skills, deepen my existing passions and just to get lost in creativity. They have class topics in so many different areas like productivity, entrepreneurship, or creative writing, really whatever you're interested in. They'll have a class for you over this past weekend, I just finished a Skillshare class called Skillshare Talks from dreaming to doing with creative freelancer, Bonnie Christine. It was an incredibly inspiring talk where Bonnie shared how she was able to take her dream of being a pattern designer and turn it into reality with some super simple, but very powerful strategies. Like she shared how one way to avoid overwhelm is by simply doing one thing a day to get closer to your goal. Skillshare is specially curated for learning. So there are no ads. They are launching new classes all the time and you can join for less than $10 a month with an annual subscription. But since I am partnering with Skillshare today, the first 1000 of you to click the link in my description box down below, will get a free trial of Skillshare premium. So you can head over there and explore your creativity. And now back to the video. The fourth number that I track every month are irregular or what I call my year end expenses. So most of us have expenses that come up throughout the year that we are not billed monthly for. And over the years, I have found that the best way for me to handle these irregular expenses is to keep tab of what they are. Add up the total, figure out what it's going to be. And then I divide that out by 12 and I make sure that every single month I'm transferring that amount into a separate savings account. So when those expenses come up and here in Switzerland, that tends to be at the end of the year, I have the money already to pay them. And I'm not just hit with all of these bills and I have to figure out how to pay them or take it from savings or whatever. I've already considered these throughout my budget throughout the year. So when the bills come around, I can just handle them. And it's not such a stress. Some of these expenses that I'm referring to include here, we pay a dog tax. We have renter's insurance. We account for Christmas gifts. We account for our tax preparation fees, because for us, they are quite high as me being a foreigner living here in Switzerland, I have to file taxes in Switzerland and in the United States this is quite expensive and this is not exactly at the end of the year, but you know, early in the new year. So I definitely want to account for that. We always go for full dental cleanings and checkups at the end of the year or in January. So I've put that into my year end fund. You get the point. There are a lot of expenses that come up throughout the year, or like I said, for me, it's mainly at the end of the year. So I divide that out and save for it now. And I definitely would recommend that you do this at a minimum, at least for your Christmas gifts. Cause we know Christmas is going to come around every single year. So instead of stressing yourself out, it's really good to be thinking about that now and be proactive. The fifth number that I track is my net worth. So net worth is simply all your assets minus all your liabilities. And I keep track of this in a very simple spreadsheet. So under assets, I basically have my checking account, my different savings accounts that I just was discussing. Um, my emergency fund, different retirement accounts that I have open, brokerage accounts, things like that, all listed under the assets column. So I keep track of how much these increase or change every single month. And this is really important for me to track because then every single month I can see how my net worth is stacking up. And if I am getting closer to my annual net worth goal, if you've never tracked your net worth before, I definitely want to encourage you to try it out because it's just a super easy way to get a quick overview of your current financial standing. I truly think it's so important to form really strong, healthy financial habits, as soon as you can. So even if you are saving $50 or $100 a month, track it, get in that habit. So when more money comes your way, you are ready to handle it and you have that habit already set. The sixth number that I track is my asset allocation. Your asset allocation is basically how your investments are divided up among different asset categories. These categories are typically cash, real estate, stocks, or bonds. So checking how my assets are allocated across these different categories. So I'm looking at the different percentage rates. This is really important for diversification of your investment portfolio. And it's important to diversify because this is basically how you manage risk. So every month I'm making sure that my investments are not skewed too much in one category versus the other. And the last number, number seven, is very similar to number six - and that is my sector breakdown. So we just discussed how you can diversify your portfolio across different asset categories. You can also achieve diversification by investing across different sectors. When you invest, there are different sectors you can choose from like IT, healthcare, consumer, finance, energy, et cetera. And in order to manage your risk, you want to make sure that you're not too heavily skewed in a certain sector because you could buy all sorts of different funds and think I'm well diversified because I own 20 different funds. But if all those funds are technology focused, for example, or consumer focused, for example, you might not have your risk managed as well as you think. So every single month, I just quickly review the sector breakdown and make sure that I'm not too heavily invested in a certain category. So that is it for the list. Those are the main seven personal finance numbers that I track every single month. Now I know a lot of you are probably going to be in the comments, asking to see some of these spreadsheets that I use. And I am currently working on those videos where I'm going to show you the actual spreadsheets that I use to track these numbers. So make sure that you subscribe to join the club and I'll talk to you guys. In the next video.Hey guys, my name is Sarah Nourse and welcome to the Money Confident Club where my goal is to help you confidently manage, plan, and invest your money. In today's video we are talking about seven personal finance numbers that I track every single month. [Upbeat music] The first number that I track is my income. This is obviously quite straightforward if you make a steady regular paycheck, but I know a lot of us out there have irregular incomes and it can be a bit more tricky to actually understand how much money you are bringing in every single month. 
 
 
So if your income is irregular or you have various streams of income, you definitely want to track how much you're bringing in every single month. So, you know exactly what you're working with. The second number that I track are my monthly expenses. And when I track my expenses, I always break them down into fixed expenses and variable expenses. We all have our fixed expenses or what I like to call my overhead expenses. And this is basically things that you can not change every single month. That's your rent, your health insurance, your cell phone plan, and things like that. Then your variable expenses are things like, you know, your grocery budget, if that fluctuates, entertainment, clothing, and things like that. 
 
Tracking your fixed expenses is quite easy because they don't really fluctuate every single month. It's more the variable expenses that you need to get a handle on. If you have no idea what your variable expenditure is, every single month, a good thing that you can do is just start tracking it, going forward, track it for a few months to see where you're at, or if you're really anxious to get started, you can kind of go back and look at your bank statements from previous months to see where you're starting at. It's really important that you understand your monthly expenditure because it's only when you have a buffer between your income and your expenses that you can start to get ahead with your money. 
 
You have to give yourself that buffer - that margin. So you can do something with your money instead of just consuming it. 
 
Third number that I track is my monthly tax obligation. So if you did not know, I actually live in Switzerland. And in Switzerland, when you get paid, even if you have a regular, salaried, full-time job, they do not take taxes out of your paycheck. 
 
They will take out social security and certain retirement contributions that you opt into, but they will not take out like your federal, state and city taxes. Here in Switzerland - your tax obligations are also your responsibility to track and pay in yourself. I have an accountant that I work with and I provide her with our estimated household income for the year. And she will send me back a report with a breakdown in our estimated tax obligation for the year. And then I take that number divided out by 12 and start making sure that I am saving for that every single month. 
 
So this is something that's really, really important for us to track. Otherwise at the end of the year, you're going to end up with a massive tax bill to pay. So every month I'm ensuring that I am setting aside the proper amount of money in a savings account. And then I pay that into the government quarterly. So then at the end of the year, they see how much I paid in and they run the numbers to see if there's anything that I owe or if I paid in too much. And then they will send you either some money back or they will send you an additional bill. Even if you live in a country where they take out your taxes through payroll deduction. I think it's really important that you get a general understanding of what your annual tax obligations actually are. So you can ensure that you're paying in the right amount. 
 
So if it's incorrect, you can adjust that with the HR office and make sure that you're just paying in the correct amount, not too much and not too little. Before I get into the next point I want to thank Skillshare for sponsoring today's video. Skillshare is an online learning community with thousands of inspiring classes for creative and curious people. Skillshare is my favorite place to explore new skills, deepen my existing passions and just to get lost in creativity. They have class topics in so many different areas like productivity, entrepreneurship, or creative writing, really whatever you're interested in. 
 
They'll have a class for you over this past weekend, I just finished a Skillshare class called Skillshare Talks from dreaming to doing with creative freelancer, Bonnie Christine. It was an incredibly inspiring talk where Bonnie shared how she was able to take her dream of being a pattern designer and turn it into reality with some super simple, but very powerful strategies. Like she shared how one way to avoid overwhelm is by simply doing one thing a day to get closer to your goal. Skillshare is specially curated for learning. So there are no ads. They are launching new classes all the time and you can join for less than $10 a month with an annual subscription. But since I am partnering with Skillshare today, the first 1000 of you to click the link in my description box down below, will get a free trial of Skillshare premium. 
 
So you can head over there and explore your creativity. And now back to the video. The fourth number that I track every month are irregular or what I call my year end expenses. So most of us have expenses that come up throughout the year that we are not billed monthly for. And over the years, I have found that the best way for me to handle these irregular expenses is to keep tab of what they are. Add up the total, figure out what it's going to be. And then I divide that out by 12 and I make sure that every single month I'm transferring that amount into a separate savings account. So when those expenses come up and here in Switzerland, that tends to be at the end of the year, I have the money already to pay them. And I'm not just hit with all of these bills and I have to figure out how to pay them or take it from savings or whatever. I've already considered these throughout my budget throughout the year. So when the bills come around, I can just handle them. And it's not such a stress. Some of these expenses that I'm referring to include here, we pay a dog tax. We have renter's insurance. We account for Christmas gifts. 
 
We account for our tax preparation fees, because for us, they are quite high as me being a foreigner living here in Switzerland, I have to file taxes in Switzerland and in the United States this is quite expensive and this is not exactly at the end of the year, but you know, early in the new year. 
 
So I definitely want to account for that. We always go for full dental cleanings and checkups at the end of the year or in January. So I've put that into my year end fund. You get the point. There are a lot of expenses that come up throughout the year, or like I said, for me, it's mainly at the end of the year. So I divide that out and save for it now. And I definitely would recommend that you do this at a minimum, at least for your Christmas gifts. Cause we know Christmas is going to come around every single year. So instead of stressing yourself out, it's really good to be thinking about that now and be proactive. 
 
The fifth number that I track is my net worth. So net worth is simply all your assets minus all your liabilities. And I keep track of this in a very simple spreadsheet. So under assets, I basically have my checking account, my different savings accounts that I just was discussing. Um, my emergency fund, different retirement accounts that I have open, brokerage accounts, things like that, all listed under the assets column. So I keep track of how much these increase or change every single month. And this is really important for me to track because then every single month I can see how my net worth is stacking up. 
 
And if I am getting closer to my annual net worth goal, if you've never tracked your net worth before, I definitely want to encourage you to try it out because it's just a super easy way to get a quick overview of your current financial standing. I truly think it's so important to form really strong, healthy financial habits, as soon as you can. So even if you are saving $50 or $100 a month, track it, get in that habit. So when more money comes your way, you are ready to handle it and you have that habit already set. The sixth number that I track is my asset allocation. Your asset allocation is basically how your investments are divided up among different asset categories. These categories are typically cash, real estate, stocks, or bonds. So checking how my assets are allocated across these different categories. 
 
So I'm looking at the different percentage rates. This is really important for diversification of your investment portfolio. And it's important to diversify because this is basically how you manage risk. So every month I'm making sure that my investments are not skewed too much in one category versus the other. And the last number, number seven, is very similar to number six - and that is my sector breakdown. So we just discussed how you can diversify your portfolio across different asset categories. 
 
You can also achieve diversification by investing across different sectors. When you invest, there are different sectors you can choose from like IT, healthcare, consumer, finance, energy, et cetera. And in order to manage your risk, you want to make sure that you're not too heavily skewed in a certain sector because you could buy all sorts of different funds and think I'm well diversified because I own 20 different funds. 
 
But if all those funds are technology focused, for example, or consumer focused, for example, you might not have your risk managed as well as you think. So every single month, I just quickly review the sector breakdown and make sure that I'm not too heavily invested in a certain category. So that is it for the list. 
 
Those are the main seven personal finance numbers that I track every single month. Now I know a lot of you are probably going to be in the comments, asking to see some of these spreadsheets that I use. 
 
And I am currently working on those videos where I'm going to show you the actual spreadsheets that I use to track these numbers. So make sure that you subscribe to join the club and I'll talk to you guys. In the next video. 

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