The next step in building your financial profile is to complete your personal balance sheet. This consists of a combination of fixed assets, medium term assets, and current assets. You can find it on My Financial Profile.
Let’s start with the first tab for fixed assets. What we mean here is usually property, although anything that is illiquid (difficult to sell in a hurry) is classed as a fixed asset. This could include investments in unlisted companies, otherwise known as private equity.
If you own your own home and live in it, then record the details under principal residence. If you aren’t able to fill in every box that’s ok, but you really need to come up with a current value. If you haven’t had your home valued recently then this may not be so easy. You may find you need to estimate based on what similar homes in your area have sold for. If you have bought your own place recently, or simply cannot come up with an estimated value, then use the purchase price as today’s value.
If you are lucky enough to own a property / properties that you rent out, then record these under investment properties. Remember that the rental income you receive should also be recorded on your income and expenditure sheet.
Ok let’s move on to medium term assets. These are generally investments for your future and may differ in holding time. The first part is for retirement schemes. If you are paying into the Japan national pension, it may not be so easy to get a current balance, but it is possible. Your company HR department can likely assist, or you can go to your local pension office and request one. You probably actually get a statement by post from time to time, but you may not pay attention to it. If you are really stuck then estimate based on what you contribute each month and how long you have been paying in.
There’s some useful information on the Japan National Pension System here.
If you have a company retirement scheme, or a personal one, make sure you record those here too. If you have worked in other countries, it’s possible you have pension assets in those countries. Make sure you are not forgetting anything. Request a statement and get a balance.
The next part is for non-pension regular investment. Do you pay into a monthly savings / investment plan where you are building up savings for the future? If so include them here. (if you are just saving in the bank, that goes under current assets)
The other assets box is just that – if it’s not cash, property, or a regular contribution scheme, it goes under other assets. This could include stocks, stock options, bonds, lump sum investments into mutual funds etc. If you’re not sure where to put something, put it here and remember to get a balance.
Lastly we have current assets. This is basically cash in the bank, or at home. If you have multiple accounts then this is a good time to figure out how much is in each of them and consolidate it into a final balance. I would include term deposits with the bank here too. Some people put anything with more than a one year maturity in medium term assets, which is fine, but cash deposits are generally easily broken if you need to access the money, so I put them in current assets.
Hopefully your balance sheet is taking shape and you have a total for fixed, medium term and current assets. You will need this when we do your asset weighting. Before that though, just go back through each section of the balance sheet and ask yourself if there’s anything else you have forgotten to include on here. Is there an old post office account that you opened years ago lurking somewhere?
Once you’ve done a final check, that concludes your balance sheet!