| Do you treat your household like a business? Maybe | | | | return is essentially an income statement and balance |
| you feel that treating your business like a business is | | | | sheet for the business activity for the year. The |
| quite enough. But think about it for a minute. As | | | | household tax identification number is your social |
| someone who owns a small business or a | | | | security number. The government views you |
| professional practice, you know there are some | | | | personally and your household as business activities. |
| fundamental ways to operate that group activity so | | | | The sooner you adopt that same viewpoint, the |
| that it is a profitable, expanding endeavor. Read on | | | | sooner you will act like a business owner and run |
| to discover how you can apply the same rules to | | | | your "household company" more profitably. |
| your household as well, which will go a long way | | | | Every business must have certain areas functioning |
| towards helping you with your personal finance | | | | to be viable: These include executive planning, |
| planning. | | | | personnel, sales, finance, technical delivery, quality |
| And not only do the same fundamental rules apply to | | | | control and public relations. Any one of these |
| your household activities, but the more you apply | | | | functions that are either not done at all or done |
| sound business practices to your household, the | | | | poorly will make the business activity non-viable and, |
| more financially secure you and your family will be. | | | | quite possibly, bankrupt. The household is no |
| But how do you get started? | | | | different. |
| Why not start your new approach to personal | | | | If you are an employee of a company, you may |
| finance planning with a change of terminology? Let's | | | | think that these functions do not apply to you. They |
| think of your household as the "parent company". In | | | | do. If you are employed, you have contracted your |
| business, a parent company owns junior or | | | | services for a salary (not really any different than |
| "subsidiary" companies and other assets. Well, your | | | | being self-employed) which is then gross income for |
| household owns assets too: a small business or | | | | the household "corporation". It is the lack of business |
| practice or stocks (subsidiary companies), bonds, | | | | perspective that has caused the adverse economic |
| cars, collectibles, etc. It has money that it owes, | | | | conditions in which we find ourselves. |
| called liabilities, such as mortgages, car loans, and | | | | One of the greatest omissions in the management of |
| personal loans. | | | | household business activity is the lack of a plan. |
| The household also has income, whether earned as | | | | Financial planning is the only way to ensure that the |
| salary or as dividends from investment activities and | | | | proper things are being done to run the household as |
| it has expenses such as the cost of living and so | | | | an expanding, profitable enterprise. Yet, the vast |
| forth. | | | | majority of American households do not have a plan |
| The household also has executives that make | | | | and the results are obvious-a record number of |
| day-to-day management decisions: you and your | | | | bankruptcies, unsustainable debt, and low income. |
| spouse. It also has staff: all of the members of the | | | | But you don't have to follow in their footsteps -- or |
| household, each of whom are responsible for certain | | | | remain on that losing path. Why not revamp your |
| functions. | | | | personal finance planning, apply the basic natural laws |
| Like any other business, your household reports its | | | | of business to your household, and grow your |
| financial condition every year. The 1040 income tax | | | | financial resources to achieve your life goals? |