A personal balance sheet is a one-page statement of what you own and what you owe on a single date. The difference between the two is your net worth. Businesses use balance sheets to report the same thing; the same layout works for one person.
The one rule: both sides balance
A balance sheet rests on a single equation:
Assets = liabilities + net worth
What you own (assets) is funded either by money you owe (liabilities) or by money that is yours (net worth). Rearranged, it is the net worth formula: net worth = assets − liabilities. Because net worth is whatever is left over, the two sides always come out equal. If your sheet does not balance, a number is missing or wrong.
The layout
Draw two columns.
Left: assets, split into:
- Cash: checking, savings, cash.
- Investments: brokerage accounts, funds, crypto, precious metals.
- Retirement accounts: at current balance.
- Property and valuables: home, car, anything with real resale value.
- Money owed to you: a loan you made to someone, if you expect repayment.
Right: liabilities and net worth, split into:
- Liabilities: mortgage, loans, credit cards, anything else you owe.
- Net worth: assets minus liabilities, placed at the bottom so the right column adds up to the left.
Many sheets also split each side into short-term and long-term items. For a personal sheet, grouping by type, as above, is easier to keep up.
A worked example
Take the date as 30 September. Round numbers:
| Assets | Liabilities and net worth | ||
|---|---|---|---|
| Checking | 8,000 | Mortgage | 220,000 |
| Savings | 22,000 | Car loan | 7,000 |
| Brokerage | 40,000 | Credit card | 1,500 |
| Home | 300,000 | Total liabilities | 228,500 |
| Car | 12,000 | Net worth | 153,500 |
| Total assets | 382,000 | Liabilities + net worth | 382,000 |
Both columns total 382,000. That equal total is the check: if the right side came to 380,000, you would know 2,000 had gone missing somewhere.
Step by step
- Pick a date. Every balance must be as of that day.
- Gather balances. Log in to each account or open the latest statement. Use the balance, not the monthly payment.
- Value what has no statement. For a car or home, use a realistic selling price, not the purchase price.
- Convert to one currency if you hold more than one.
- Add each side, then compute net worth.
- Check that both columns match.
- Save it with its date. The date is what makes the next version comparable.
What makes a balance sheet useful
- Consistency. Use the same accounts, same valuation rules and same currency each time.
- Realistic values. A home worth 300,000 on paper that would sell for 270,000 gives a false picture.
- Whole debts. List every loan at its full balance.
- Only what matters. A balance sheet does not need every coffee and grocery bill. It tracks the large items that move your position.
Common mistakes
- Leaving the mortgage off while listing the home.
- Valuing a car at purchase price.
- Mixing dates, with one balance from last month and another from this morning.
- Counting expected income as an asset.
- Giving up because the first version took long. The first pass is the slow one; later updates only change the balances that moved.
Balance sheet or budget?
They answer different questions. A budget asks where money goes each month. A balance sheet asks where you stand today. You can have either without the other. If you want to see how the lists are built, start with how to calculate net worth, and if you are unsure where an item belongs, read assets vs liabilities.
Where to keep it
A sheet of paper works. So does a spreadsheet, which is flexible but needs upkeep (how Accounted compares with a spreadsheet).
Accounted is an iPhone app built around this exact layout. Assets sit in one column and liabilities in the other, every block is drawn to scale, and net worth fills the gap so both columns come out the same height. You type balances yourself, and there is no bank login. See how it works or open the demo on the home page.
This guide is general information, not financial advice.
General information, not financial advice.