Financial Health Checks

Keeping track of all your bills, subscriptions and expenses can make money management challenging. However, by periodically checking the Neontra Health Checks, you can manage your finances and make more informed financial decisions. With the help of Neontra Health Check, you can create a budget that works for you, track your income, expenses, assets, liabilities and establish financial goals.

Expenses

To begin utilizing the Health Check scorecards, compile all of your financial data. This covers your earnings, out-of-pocket costs, debt, and savings. Gather your bank statements, credit card statements and bills. It will be simpler for you to enter the data if you have all of this information at hand.

Income

It is now time to ascertain your income after you have compiled all of your financial data. Add up all of your income sources, including your pay, bonuses, and any other money you get, to determine your monthly income. Don't forget to account for both your normal income and any potential sporadic or variable income.

Expenses Health Scorecard

Neontra will automatically calculate your ratio of expenses versus income. The ideal target is to spend less than 80% of your income. This would result in an 'Excellent' score of 20/20. Spending more than your income or a ratio greater than 100% would result in a 'Needs Work' score of 0/20. If you have a low score Consider setting up budget targets to control spending and improve your score.

Savings Health Scorecard

Savings Health is a ratio of your monthly savings versus monthly income. The ideal target is to save 20% or more of your income. This would result in an 'Excellent' score of 20/20. Saving less (a ratio less than 20%) would result in a lower score. Consider reviewing Cash Flow to identify areas where you can increase savings. This will help you see where your money is going and identify areas where you can potentially cut back. Whether it's saving for a down payment, paying off debt, or building an emergency fund, setting goals can help you stay motivated and focused on improving your financial situation.

Emergency Funds Scorecard

Emergency Funds is a measure of how long your savings could sustain your lifestyle given your current expenses. The ideal target is to have enough emergency funds to cover five or more months worth of expenses. This would result in an 'Excellent' score of 20/20. Emergency funds covering less than five months of expenses will result in a lower score. Review non-essential expenses to identify potential saving opportunities.

Investment Portfolio Allocation

There are many different portfolio allocation methods and you should consult with a certified financial professional to find the one that best suits your risk appetite and requirements. No simple formula can find the right asset allocation for every individual investor. Neontra uses a generic allocation scoreboard for illustrative purposes.

Portfolio allocation measures your asset allocation and investments in your portfolio. For a balanced portfolio, the ideal target is to have a mix of asset classes. An 'Excellent' investment portfolio would include a balanced allocation of stocks, fixed income (bonds, CDs, GICs) and mutual funds. It would also include a 401k or Roth IRA in the U.S. or RRSP and TFSA in Canada.

Your score is calculated as follows:
Do you have investments?
+1 for any stocks
+1 for any fixed income: bonds, CDs, GICs
+1 for any mutual funds
+2 if you have a 401(k)/TFSA
+2 if you have an Roth IRA/RRSP

Consult with a professional Financial Advisor, Financial Planner or Wealth Manager to learn about the different allocation strategies. Most financial professionals will tell you that asset allocation is one of the most important decisions investors can make.

Debt Health

Debt Health is a ratio of your debt to assets. The ideal target is to have debts worth less than 35% of your assets. This would result in a score of 10/10. If debts are worth more than 35% of your assets it will result in a lower score. Consider reviewing the Balance Sheet to get the full picture of your personal debt.

Credit Card Health

Credit Card Health measures your available credit. The ideal target is to use 30% or less of your available credit. This would result in a score of 20/20. Using more than 30% would result in a lower score. A score of zero will be given if the credit limit has not been set. Consider reviewing credit card debt costs to identify opportunities to reduce debt.

Track Your Progress

It's important to track your progress regularly. Update your actual income, expenses, assets and liabilities each month to see how well you are tracking. This will help you identify any areas where you may be overspending and make necessary adjustments to stay on track.

A financial advisor, financial planner, credit counselor or wealth manager can provide guidance and help you develop a personalized plan that suits your specific needs and goals. They can also help you navigate through any financial challenges or obstacles you may encounter along the way.

Neontra Health Checks

The Neontra Health Checks are powerful tools that can help you take control of your finances and achieve your financial goals. The scorecards make it easy to see how you are tracking towards your financial goals and financial wellness. With the help of the scorecards, you can pave the way to a brighter, more secure and stable financial future.