After a long thread of very interesting comments from some readers, I've been giving more and more thought to the task of completely converting my personal cashflow model to a more traditional set of personal financial statements.

As I explained in the thread, years before my graduate certificate in financial planning, I spent a lot of time reading Money magazine and working through my money issues as I saw them. I designed my own system of "cash-in" and "cash-out" money management that worked for me. As I saw it, all income was "cash-in" and all outflow from my checking (where I managed all my money) was "cash-out". I later replaced my checking with a brokerage account, but the principle was the same to me. I categorized all the outflow into a set of about 14 categories which included long term and short term savings, debt, and the various other common categories like rent, groceries, etc.

I realized this system works for me because I understand it, but I've also realized that it doesn't make much sense to people just getting interested in managing their own finances - i.e. most of my clients. So... I'm undertaking a conversion effort to get my model into shape with traditional financial statements. I will report on this effort as it progresses because the exercise might yield useful tips for beginners.mortgage calculator