Who doesn’t love curling up with a good book?! Grab your coffee or wine (depending on the time of day), the fluffiest blanket you have, throw on some fluffy socks too, grab the book, and create your cocoon of happiness. You’re ready! Ready to set out on an adventure reading fiction, or history, or crime, or whatever floats your boat (if this was my husband, it would be books about stocks). The value of this book is priceless because of what it offers us…a chance to immerse ourselves within a dream.
You obviously know the priceless value of the books you immerse yourself in, but what about your own book…your own financial story?
Do you know and understand your own “Book Value”?
To be completely technical, the definition of “Book Value”, according to the Corporate Finance Institute, is a “company’s equity value as reported in its financial statements. The book value figure is typically viewed in relation to the company’s stock value and is determined by taking the total value of a company’s assets and subtracting any of the liabilities the company still owes.”
In short, it basically means the same thing as “Net Worth” – the total amount of assets minus any debts. For a company, this value is extremely important in that it represents an accurate view of what that company is actually worth. No fluff. No clouds. Only the facts.
I know what you’re thinking, “Girl, you have LOST me on this one!” Hang with me on this…
Have you ever read a bad book? A book that was so poorly written that you could not bring yourself to finish it. What did you do with it? You probably donated it to some poor soul or you tossed it…straight into the trash. Why? Because that book’s value meant nothing to you. It was not what you hoped it would be, it was not the story you wanted to invest in, and it was not worth the emotional toll it would take to read it.
When it comes to your financial journey, you will either immerse yourself in your own priceless story, or you’ll be living with the emotional toll of a poorly written plot.
Do you understand what your own financial “Book Value” is? Do you know what your own financial books are actually showing…what your assets minus your debts are? If you do this little exercise of figuring it out and you discover this value is the “bad book” you were dreading, the good news is that you can re-write it! There is time!
What you can do to improve?
- Create a $1,000 emergency fund to help protect your debt pay-off strategy from unexpected expenses.
- Understand your full debt amount and write it down.
- List them according to their debt amounts and interest rates.
- Look through your monthly expenses, see what you can live without for a while, and see what items you can sell (big or small).
- Take any extra money you come up with and attack the smallest debt first (aka Debt Snowball), but keep paying the minimums on all the others.
- A side hustle would also be a great way to expedite paying-off your debt.
- When you pay-off the debt, take the full amount you were paying towards it and add it on top of the minimum payment of the next debt.
- Continue until you pay-off all your debts!
What do you do when all debts are paid and you have all this money doing nothing? Time to INVEST and increase your assets.
Congrats!! You have just turned your financial story into a priceless adventure!
You have eliminated your debts and your “Book Value” is going up and UP! Be excited. Be proud that YOU made this change…YOU re-wrote this story…YOU are making it a success.
God created us for so much more than just living in stress and anxiety; He meant for each one of us to live a fulfilling life. He created an incredible story with YOU as the main protagonist. Fight for change and fight for that story. If you need any help with this, I’m here for you!
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