When it comes to personal finances, having a clear understanding of your financial situation is crucial for achieving financial wellness. Assessing your finances involves taking stock of your income, expenses, assets, and liabilities. This process allows you to evaluate your financial health and make informed decisions to improve it.

Start by creating a budget to track your income and expenses. Review your monthly expenses to identify areas where you can cut back or reallocate funds. This will help you prioritize your spending and allocate more towards savings or debt repayment.

Next, assess your assets and liabilities. Take inventory of your savings, investments, and property, as well as any debts you owe. Evaluate their respective interest rates and terms. This will give you a better understanding of your net worth and help you formulate strategies to build wealth and reduce debt.