Turning Tax Preparation into a Positive, Rewarding Activity (Really!)

Turning Tax Preparation into a Positive, Rewarding Activity (Really!)

IIn his song “Golden Moments,” James Taylor said: “All it really needed was the proper point of view”. I doubt he had tax preparation in mind when he wrote it. But if you look at the tax preparation process from a different perspective, it could take on a whole new meaning. Instead of being a dreaded annual task with a narrow purpose, it could be the start of a bigger Cash Flow Financial Management opportunity.

Yes, gathering all the documents and receipts is still a chore. But think about it ­ you’re taking time to collect, organize and update much of your financial information. Why should that be a once­a­year task to be done and then forgotten for 12 months? Instead, look at it as the starting point for developing a long­term financial plan for your household.Since you’ve already gathered the information, why not use it to create or update your 8020 Worksheet™?

That will help you understand your overall financial situation ­ both your net worth and cash flow. Then, with the help of your accountant or financial advisor you can develop a long term financial strategy. You can even begin taking action on the strategy by setting and achieving one goal at a time using the Goaltracker™ feature of the 8020 Worksheet™.

That’s a complete, ongoing Financial Planning process ­ all of it jump started by the tax preparation activity.

I’ve always preferred spending time on improvements rather than maintenance activities. Cleaning the house and cutting the grass is just maintenance. But making the house or yard better is an improvement. The same holds true with finances. Why just do your taxes and then forget it?

That’s maintenance. Instead, take full advantage of the activity to build and implement a financial plan. That’s improvement.

For more information, please visit our Web site at https://www.cashflownavigator.com/