If you’re like most of us, you are reading this site (and other personal finance sites) because you’re trying to get a handle on your household finances. Maybe you’re in debt. Maybe there has been a change in your financial situation and you’re just trying to learn how to keep from going into debt. There are any of a hundred reasons you’re visiting here today, but one thing that is constant is that each of us has (had) to learn our starting point.

You may have heard this before… maybe even a hundred times before, but you can’t get “there” unless you know where “here” is. The prospect is indeed very scary. When I introduced my sister to Mint, and she saw where her money was actually going instead of where she thought it was going, she said she felt exposed in a way she wasn’t expecting. I heartlessly told her to get a fig leaf and keep on trucking!

So what if you learn you spent $15,000 eating out last year (like I found out in 2007!) or you spend $50 a month at iTunes? Doing a status check and finding out what your financial standing is and where your money really is going isn’t about recrimination. It’s about educating yourself on your real situation, instead of what you guess your situation is, and making small and sustainable changes to improve things for yourself and your family.

Where to start?

• With the paper trail (electronic or hard copy… makes no difference how you access it).
  • Gather all of your bank and credit card information
  • Gather all of your bill information
  • Make a list of all of your obligations (yes, that $30 a month gym membership you don’t use does count)
• Figure out what your balances are.
  • Bank account balances (and make sure you factor in outstanding transactions!)
  • Credit card balances
  • Overdue on any bills? Need to figure that out too
• Categorize your expenses for the last 30 days
  • This is as easy as setting up a Mint account and adding in your account information. You may have to re-categorize a few things, but chances are it’ll be pretty darned accurate.
  • OR input everything in a spreadsheet, if that’s your thing.

Once you know what your status is, you’ll be in a better position to make any needed adjustments to your spending… or perhaps to boost your earnings. Maybe you’re even doing just fine! You won’t know until you get your status check done though. **NOTE** There is a “No beating yourself up” rule that comes along with this status check. You can resolve to do better. You can resolve to make adjustments. You can’t, however, waste time and energy on “coulda, woulda, shoulda, but didn’t”.