My Monthly Balance Sheet

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My Monthly Balance Sheet

My Monthly Balance Sheet

Have you ever noticed how your parents keep a record of all the expenses of the house? Although everything is digital nowadays, some parents still keep records to check how the cash at home is spent – Inflow and Outflow. This record simply is called a balance sheet.

The benefit of maintaining a balance sheet is to understand where the money is going.

If you get some pocket money or gift money on special occasions, you too can try and keep a balance sheet for your expenses. This will help you understand how money flows, and you will also be able to explain the usage of your money to your parents. This will make you more responsible and mindful of your spending.

When you go out to eat or shop, have you noticed your parents pay the cashier with a card or else in paper notes?

Have you ever wondered what effect that has on your parents’ total money?

You must know the answers to the simple questions above. When your parents give their cards or paper money to buy an item, some money gets deducted or reduced from the money they have. This process of deduction is called the Outflow of money.


Have you noticed your parents or adults talking about something called a “payday”?

A “payday” is a date that arrives every month, either the 1st of every month or the 30th/31st of every month. On this date, adults get paid for the services/work they do. This is an addition to the money they already have. This is called the Inflow of money.

If we look at our previous situation of shopping, the money your parents pay to buy a product is the money that the shopkeeper gets for selling the same product. Therefore, selling a product adds money to the shopkeeper’s total, which becomes an inflow of money.

So, from above, we can sum up by saying, “someone’s outflow is somebody else’s inflow.

You might get some amount of money as pocket money or gift money. You can also keep a record of the same using a simple T-table.

(increases total balance)(decreases total balance)

We write our inflow and outflow on the left and right sides, respectively, as you can see in the above format, of the Balance sheet. This will help you keep track of your transactions. Always remember, the TOTAL OF BOTH SIDES MUST BE EQUAL.

If the total is not equal, then it means you may have missed out on some transactions.

How to make the balance sheet:

  1. Write the current total balance on the top of your balance sheet
  2. You can write down all of your transactions on your phone, excel sheet or on paper, whichever suits you best
  3. Draw your T-table
  4. Every time someone gives you money, write it under Inflow. Every time you pay someone, record this under Outflow. (You can write details of transactions in brackets to help you remember)
  5. Keep checking your balances every month at regular intervals to see if they add up.
  6. Add the inflows to the total written above the balance sheet and deduct the outflows. If you have the same amount in hand with you, then you have recorded your transactions, right
  7. Make sure you write down all of the transactions properly

Let’s take some transactions as examples. Take a blank sheet of paper and record the following transactions in your balance sheet or Inflow-Outflow statement. You can also verify your transactions as you move ahead.

  1. Today is 2nd February.
  2. Kartik woke up in the morning to the tune of “Happy Birthday to you”. His entire family was gathered around him, singing and wishing him on his special day.
  3. Kartik’s father gave him Rs. 7000 as pocket money for this month on his 16th birthday. He asked Kartik to maintain a record of his expenses.

4.  Kartik received a lot of calls and messages from friends asking him about the party. He decided to give a lunch party to his friends.

5. He bought a Bluetooth earphone for his mobile of Rs 1300 from Amazon.

6. He booked a cab to go to the party and paid Rs. 150 for the taxi.

7.After the party, Kartik paid Rs. 2000 to the restaurant.

8. In the evening, he went to see his grandparents for their blessings. They gave him Rs. 1000 as a birthday gift.

9. In the night, before going to bed, Kartik put Rs. 500 in his piggy bank for later use.

10.The next day, Kartik’s Mom asked him to buy a bread and butter packet while coming back from jogging.  He spent Rs. 200.

11. On 4th February, Kartik was cleaning his cupboard. He found some used sports things which he was no longer using. He sold it on OLX for Rs. 450.

12. Days passed by, and on 10th Feb, Kartik saw an advertisement for his favourite book available at a 50% discount. He immediately ordered one. He paid Rs. 350 for the book.

13. 20th Feb was his Grandparent’s anniversary. He took them both to a temple, where he donated Rs. 501 to the temple.

14. 25th Feb, Kartik’s younger sister asked him for Rs. 300 as a hand loan, which she will return next month.

15. 28th Feb was his mother’s birthday, and he wished to get her a gift. His mom agreed to go shopping with Kartik for the same.

16. He opened his Piggy Bank and took the money, and put it in his wallet.

17 .On 1st March, he took his mom out shopping, and she picked up “Charcoal Barbecue Grill” as her birthday for Rs 2000.

18. In the evening, Kartik’s father asked him to submit records of the pocket money and check if he needed more pocket money for next month.

Does your Balance sheet look like below?

Now that we have solved the transactions. Let’s try and sum up what we have learned:

  • Inflow: increases the Total Balance
  • Outflow: decreases the Total Balance
  • Money put in a piggy bank is not Outflow but reduces Total Balance. It is called Saving
  • When you take money out of the piggy bank, it is not Outflow. It increases the Total Balance. It reduces Saving
  • Money spent on behalf of someone else / given as hand loans is Outstanding. It is not Outflow but reduces the Total Balance
  • Outstanding means “expected to get back”
  • Left Hand Side = Right Hand Side

In our holistic education sessions, we work with our students discussing each of the transactions and understanding their point of view and explaining what is outstanding and what is saving. You can do the same too. If you want to watch the entire recording of the session, you can download our app and watch the recording from our holistic education batch. The link to the app is here 

For Iphone:

For  Android:

You can also get in touch with us, if you have any questions on [email protected]

Now that you know how to create your own balance sheet, let us know a date by when you will create your personal balance sheet. Also tell us about your insights reading this blog.

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