Last Updated on November 8, 2017
Financial health refers to ‘where we stand today’ with respect to our finances and what we need to do in the coming years to handle future expenses and financial goals.
In this post, I would like to describe a simple exercise to assess our personal financial health. This process can be automated with the integrated financial planning template.
The process in which expenses, investment amount needed for financial goals, along with expected salary are projected into the future was a pivotal exercise in my financial learning curve.
The idea is to create a table with the following entries:
- We take our current salary and project it in future with some reasonable growth rate.
- Do the same with current expenses with an assumed inflation rate
- Determine the total investment amount required for all out goals and if possible increase it at some rate for the coming years.
- Determine the amount that we can invest each month – now and in future (increased or decreased at some rate).
- Consider any current and future liabilities.
We might end up with something like this. This is a screenshot from the above-mentioned financial planning template.

The red cells are those years when we will be investing less than required for our goals. If there are too many red cells, then goal priorities and inputs may have to be altered.
This exercise can be a confidence booster for a few and scary for many – including me.
- This is only a projection with assumed inputs. The future can turn out better (or ..) than this.
- If we keep out head down and invest systematically with a solid strategy in place, with a bit of luck, and in time, the number of red cells may come down.
- I did not lose sight of this hope when I first did this exercise 6 years ago, and I would urge you to do the same.
- Like any other goal-planning exercise, it is important to do this assessment once a year.
- In some cases, the red cells (inability to invest enough) can be reduced with small changes in lifestyle.
After I did this exercise, I had a clear idea of where I stand and what I can hope for in future. To be frank, I was disappointed that a couple of my wants could not be accommodated after accounting for my needs. Well, we can’t have everything, can we?
Use the freefincal robo advisory template
or
Download the Integrated Financial Planning Template
How to profit from content writing: is our new ebook for those interested in getting side income via content writing. It is at available at a 50% discount for Rs. 500 only!
Use our Robo-advisory Excel Template for a start-to-finish financial plan!
Join our courses in exclusive Facebook Groups!
- 520+ members are now part of our new course: How to get people to pay for your skills! (watch 1st lecture for free). Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show how to achieve by showcasing your skills and building a community that trusts you and pays you!
- Goal-based portfolio management! Join 2125+ members and get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free! One-time payment of Rs. 3000 only. No recurring fees! Life-long access to videos (10+ hours content) in an exclusive Facebook Group! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Want to check if the market is overvalued or undervalued? Use our market valuation tool (will work with any index!) or you buy the new Tactical Buy/Sell timing tool!
We publish mutual fund screeners and momentum, low volatility stock screeners .every month.
About the Author

About freefincal & its content policy Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on developments in mutual funds, stocks, investing, retirement and personal finance. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than one million readers a year (2.5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified from credible and knowledgeable sources before publication. Freefincal does not publish any paid articles, promotions, PR, satire or opinions without data. All opinions presented will only be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our Youtube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing

Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want

Your Ultimate Guide to Travel

Free android apps
- All calculators from our book, “You can be Rich Too” are now available on Google Play!
- Install the Financial Freedom App! (Google Play Store)
- Install Freefincal Retirement Planner App! (Google Play Store)
- Find out if you have enough to say "goodbye" to your employer (Google Play Store)