U.S. SECURITIES AND EXCHANGE COMMISSION
                                Washington, D.C.

                                   FORM 10-QSB

           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                      For the quarter ended March 31, 2000

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                        Commission file number 333-69415


                              BALANCED LIVING, INC.
           (Name of Small Business Issuer as specified in its charter)


           Colorado                                     87-0575577
  (State or other jurisdiction of           (I.R.S. employer identification No.)
  incorporation or organization)


         6375 South Highland Drive, Suite D, Salt Lake City, Utah 84121
                    (Address of principal executive offices)


                                  801-424-1624
                (Registrants telephone no., including area code)

                                    No Change

             (Former name, former address, and former fiscal year,
                         if changed since last report.)

    Securities registered pursuant to Section 12(b) of the Exchange Act:None

    Securities registered pursuant to Section 12(g) of the Exchange Act:None


Check  whether  the Issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the Exchange  Act during the  preceding 12 months (or for
such shorter period that the registrant was required to file such reports),  and
(2) has been subject to such filing requirements for the past 90 days.

                                    Yes X No

  Common Stock outstanding at March 31, 2000:867,849 shares of $.001 par value

<PAGE>

                              BALANCED LIVING, INC.
                         [ A Development Stage Company ]

                                      INDEX

PART I  Financial Information

Item 1 Accountants' Review Report                                            3

Unaudited Condensed Consolidated Balance Sheets, March 31, 2000
and December 31, 1999                                                        4

Unaudited Condensed Consolidated Statements of Operations,  for
the three months ended March 31, 2000 and 1999 and from inception on
January 26, 1998 through March 31, 2000                                      5

Unaudited Condensed Consolidated Statements of Cash Flows, for
the three months ended March 31, 2000 and 1999 and from inception on
January 26, 1998 through March 31, 2000                                      6

Notes to Unaudited Condensed Consolidated Financial Statements            7 - 12

Item 2 Management's Discussion and Analysis                                 13


PART II Other Information

Item 1 Legal Proceedings                                                    16

Item 2 Changes in Securities                                                16

Item 3 Defaults upon Senior Securities                                      16

Item 4 Submission of Matters to a vote of Security Holders                  16

Item 5 Other Information                                                    16

Item 6 Exhibits and Reports on Form 8-K                                     16

Signature page                                                              16

                                       2
<PAGE>

                          PART I FINANCIAL INFORMATION

Item 1 Financial Statements

                           ACCOUNTANTS' REVIEW REPORT

Board of Directors
BALANCED LIVING, INC. AND SUBSIDIARY
Salt Lake City, Utah

We have reviewed the  accompanying  condensed  balance sheet of Balanced Living,
Inc. and Subsidiary [a  development  stage company] as of March 31, 2000 and the
related  condensed  statements of operations and cash flows for the three months
ended  March 31,  2000 and for the period  from  inception  on January  26, 1998
through March 31, 2000. These financial statements are the responsibility of the
Company's management.  All information included in these financial statements is
the representation of management of Balanced Living, Inc. and Subsidiary.

We conducted our review in accordance with standards established by the American
Institute of Certified  Public  Accountants.  A review  consists  principally of
inquiries of Company  personnel and analytical  procedures  applied to financial
data.  It is  substantially  less in  scope  than an audit  in  accordance  with
generally accepted auditing standards,  the objective of which is the expression
of an opinion regarding the financial statements taken as a whole.  Accordingly,
we do not express such an opinion.

Based on our review, we are not aware of any material  modifications that should
be made to the condensed financial  statements reviewed by us, in order for them
to be in conformity with generally accepted accounting principles.

The accompanying  financial statements have been prepared assuming that Balanced
Living,  Inc. and Subsidiary  will continue as a going concern.  As discussed in
Note 12 to the financial  statements,  Balanced Living,  Inc. and Subsidiary has
current  liabilities in excess of current assets,  has incurred losses since its
inception and has not yet been successful in establishing profitable operations,
raising  substantial  doubt about its  ability to  continue as a going  concern.
Management's  plans in regards to these  matters are also  described in Note 12.
The financial  statements do not include any adjustments  that might result from
the outcome of these uncertainties.

/s/ Pritchett, Siler & Hardy, P.C.

PRITCHETT, SILER & HARDY, P.C.

May 4, 2000
Salt Lake City, Utah

                                       3
<PAGE>
<TABLE>
<CAPTION>
                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                  [Unaudited - See Accountants' Review Report]

                                     ASSETS

                                                                               March 31,            December 31,
                                                                                 2000                   1999
                                                                            ----------------       ----------------
CURRENT ASSETS:
<S>                                                                         <C>                    <C>
     Cash in bank                                                           $         55,962       $          5,772
     Inventory                                                                         4,152                  4,615
     Prepaid expenses                                                                    600                    600
                                                                            ----------------       ----------------
               Total Current Assets                                                   60,714                 10,987

EQUIPMENT, net                                                                         3,417                  3,620
                                                                            ----------------       ----------------
                                                                            $         64,131       $         14,607
                                                                            ----------------       ----------------


                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
     Accounts payable                                                       $         11,553       $         31,834
     Notes payable - related party                                                   255,000                105,000
     Accrued liabilities                                                               5,404                    779
                                                                            ----------------       ----------------
               Total Current Liabilities                                             271,957                137,613
                                                                            ----------------       ----------------

STOCKHOLDERS' EQUITY (DEFICIT):
     Preferred stock, $.001 par value,
       10,000,000 shares authorized,
       no shares issued and outstanding                                                    -                      -
     Common stock, $.001 par value,
       50,000,000 shares authorized,
       867,849 shares issued and outstanding                                             868                    868
     Additional paid in capital                                                      609,994                609,994
     Deficit accumulated during the
       development stage                                                            (818,688)              (733,868)
                                                                            ----------------       ----------------
               Total Stockholders' Equity (Deficit)                                 (207,826)              (123,006)
                                                                            ----------------       ----------------
                                                                            $         64,131       $         14,607
                                                                            ----------------       ----------------


Note: The balance sheet at December 31, 1999 was taken from the audited financial statements at that date and condensed.

                  The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>

                                       4
<PAGE>
<TABLE>
<CAPTION>
                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  [Unaudited - See Accountants' Review Report]

                                                                   For the Three                     From Inception
                                                                   Months Ended                      on January 26,
                                                                     March 31,                        1998 Through
                                                          ------------------------------                 March 31,
                                                            2000                1999                       2000
                                                          ------------       -----------              -------------
<S>                                                       <C>                <C>                      <C>
REVENUE                                                   $      3,573       $     9,869              $      61,333

COST OF SALES  3,271                                             6,435            75,078
                                                          ------------       -----------              -------------
GROSS PROFIT (LOSS)                                                302             3,434                    (13,745)
                                                          ------------       -----------              -------------
EXPENSES:

    General and administrative                                  80,414            81,642                    707,539
                                                          ------------       -----------              -------------
OPERATING LOSS (80,112)                                        (78,208)         (721,784)

OTHER INCOME (EXPENSE):

    Interest expense                                            (4,708)           14,752                    (97,404)
                                                          ------------       -----------              -------------
LOSS BEFORE INCOME TAXES                                       (84,820)          (92,960)                  (818,688)

CURRENT TAX EXPENSE                                                  -                 -                          -

DEFERRED TAX EXPENSE                                                 -                 -                          -
                                                          ------------       -----------              -------------

NET LOSS                                                  $    (84,820)      $   (92,960)             $    (818,688)
                                                          ============       ===========              =============
LOSS PER COMMON SHARE:
    Basic loss per share                                  $       (.10)      $      (.16)             $       (1.09)
                                                          ============       ===========              =============

    The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
</TABLE>

                                       5
<PAGE>
<TABLE>
<CAPTION>
                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                  [Unaudited - See Accountants' Review Report]


                                                                  For the Three                     From Inception
                                                                  Months Ended                       on January 26,
                                                                    March 31,                         1998 Through
                                                          ------------------------------                March 31,
                                                            2000                1999                       2000
                                                          ------------       -----------              -------------
Cash Flows From Operating Activities:
<S>                                                       <C>                <C>                      <C>
   Net loss                                               $    (84,820)      $   (92,960)             $    (818,688)
   Non-cash operating items                                          -            30,000                     67,500
   Adjustments to reconcile net
     loss to net cash used by
     operating activities:
      Depreciation                                                 203               168                      1,305
      Non-cash expense                                               -                 -                     10,362
      Changes in assets and liabilities:
        (Increase) decrease in inventory                           463             1,200                     (4,152)
        (Increase) decrease in prepaid assets                        -           (19,438)                      (600)
        Increase (decrease) in accounts payable                (20,281)            2,156                     11,553
        Increase in accrued liabilities                          4,625               436                      5,404
                                                          ------------       -----------              -------------
          Net Cash Used by Operating
             Activities                                        (99,810)          (78,438)                  (727,316)
                                                          ------------       -----------              -------------
Cash Flows From Investing Activities:
   Equipment purchases                                               -            (1,086)                    (4,722)
                                                          ------------       -----------              -------------
          Net Cash Used by Investing Activities                      -            (1,086)                    (4,722)
                                                          ------------       -----------              -------------
Cash Flows From Financing Activities:

   Proceeds from options granted                                     -                 -                      5,000
   Proceeds from common stock issuance                               -                 -                    203,000
   Proceeds from issuance of warrants
    and notes payable                                          150,000            60,000                    580,000
                                                          ------------       -----------              -------------
          Net Cash Provided by Financing
             Activities                                        150,000            60,000                    788,000
                                                          ------------       -----------              -------------
Net Increase in Cash                                            50,190           (19,524)                    55,962

Cash at Beginning of Period                                      5,772            56,663                          -
                                                          ------------       -----------              -------------
Cash at End of Period                                     $     55,962       $    37,139              $      55,962
                                                          ============       ===========              =============
Supplemental Disclosures of Cash Flow information:

   Cash paid during the period for:
     Interest                                             $          -       $     4,190              $      24,880
     Income taxes                                         $          -       $         -              $           -

Supplemental schedule of Noncash Investing and Financing Activities:
   For the three months ended March 31, 2000:
       None.

   For the three months ended March 31, 1999:
        None.


       The accompanying notes are an integral part of these unaudited  condensed consolidated financial statements.
</TABLE>

                                       6
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Organization - The Balanced Woman, Inc.  ("Subsidiary") was organized under
     the laws of the State of Colorado on January 26, 1998.  During  July,  1998
     the  Company  was  reorganized  through  a stock for  stock  exchange  with
     Balanced  Living,  Inc.  ("Parent") [See Note 2]. Balanced  Living,  Inc. a
     Colorado  corporation,  was organized on July 1, 1998.  The Company has not
     raised  significant  revenue  from  planned  principal  operations  and  is
     considered  a  development  stage  company  as  defined  in SFAS No. 7. The
     Company is engaged in the business of holding  motivational  seminars,  and
     selling  books and other  motivational  products.  The Company  has, at the
     present time,  not paid any dividends and any dividends that may be paid in
     the future will depend upon the financial  requirements  of the Company and
     other relevant factors.

     Consolidation - The consolidated  financial statements include the accounts
     of the Company and its wholly-owned  subsidiary,  The Balanced Woman,  Inc.
     All  significant   intercompany   transactions   have  been  eliminated  in
     consolidation.

     Condensed Financial Statements - The accompanying financial statements have
     been prepared by the Company  without audit.  In the opinion of management,
     all  adjustments  (  which  include  only  normal  recurring   adjustments)
     necessary to present fairly the financial  position,  results of operations
     and cash flows at March 31,  2000 and 1999 and for the  periods  then ended
     have been made.

     Certain information and footnote disclosures normally included in financial
     statements  prepared  in  accordance  with  generally  accepted  accounting
     principles  have been  condensed  or omitted.  It is  suggested  that these
     condensed  financial  statements be read in conjunction  with the financial
     statements  and notes thereto  included in the Company's  December 31, 1999
     audited  financial  statements.  The results of operations  for the periods
     ended  March  31,  2000 are not  necessarily  indicative  of the  operating
     results for the full year.

     Inventories - Inventories  are stated at the lower of cost or market.  Cost
     is determined by the first-in, first-out method.

     Equipment  -  Equipment  is  carried  at cost and is  depreciated  over the
     estimated useful life of the equipment using the straight line method.

     Revenue Recognition - The company's revenue comes from holding motivational
     seminars and selling  motivational  products (books,  cards,  CD's,  etc.).
     Revenue is  recognized  when the  services  are  rendered or the product is
     delivered.

     Loss Per Share - The computation of loss per share is based on the weighted
     average  number  of shares  outstanding  during  the  period  presented  in
     accordance  with SFAS No. 128 "Earnings Per Share".  Diluted loss per share
     is not presented because its effect is antidilutive.

     Statement of Cash Flows - For purposes of the statement of cash flows,  the
     Company  considers  all highly  liquid debt  investments  purchased  with a
     maturity of three months or less to be cash equivalents.

                                       7
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Continued]

     Accounting   Estimates  -  The  preparation  of  financial   statements  in
     conformity  with  generally   accepted   accounting   principles   requires
     management  to make  estimates  and  assumptions  that affect the  reported
     amounts of assets and liabilities, the disclosures of contingent assets and
     liabilities  at the  date of the  financial  statements,  and the  reported
     amount of revenues and expenses during the reported period.  Actual results
     could differ from those estimated.

     Recently Enacted Accounting  Standards - Statement of Financial  Accounting
     Standards (SFAS) No. 132,  "Employer's  Disclosure about Pensions and Other
     Postretirement   Benefits",   SFAS  No.  133,  "Accounting  for  Derivative
     Instruments  and  Hedging  Activities",   SFAS  No.  134,  "Accounting  for
     Mortgage-Backed Securities...", SFAS No. 135, "Rescission of FASB Statement
     No. 75 and Technical Corrections",  SFAS No. 136, "Transfers of Assets to a
     not for  profit  organization  or  charitable  trust  that  raises or holds
     contributions  for others",  and SFAS No. 137,  "Accounting  for Derivative
     Instruments and Hedging Activities - deferral of the effective date of FASB
     statement  No.  133 ( an  amendment  of FASB  Statement  No.  133.),"  were
     recently  issued.  SFAS No. 132, 133, 134, 135, 136 and 137 have no current
     applicability  to the Company or their effect on the  financial  statements
     would not have been significant.

NOTE 2 - BUSINESS REORGANIZATION

     On July  14,  1998  the  Company  entered  into an  Agreement  and  Plan of
     Reorganization  wherein  Parent  acquired  all the issued  and  outstanding
     shares of common stock of Subsidiary in a stock for stock exchange.  Parent
     issued  500,000  shares  of  common  stock  in  the  exchange.  Parent  and
     Subsidiary  had similar  ownership at the time of  reorganization  and were
     considered  to  be  entities  under  common   control.   Accordingly,   the
     reorganization  has been  recorded  in a manner  similar  to a  pooling  of
     interests.

NOTE 3 - INVENTORIES

     Inventories  consisted  of finished  goods in the amount of $8,152 at March
     31, 2000. An allowance for obsolete or slow moving  inventory of $4,000 was
     recorded during 1999.

NOTE 4 - EQUIPMENT

     Equipment consists of the following:

                                      Estimated
                                      Useful Lives   March 31,    December 31,
                                        in Years       2000          1999
                                       -----------   ---------    ---------
           Office equipment              5 - 7       $   4,722    $   4,722
                                       -----------   ---------    ---------
                                                         4,722        4,722
           Accumulated depreciation                     (1,305)      (1,102)
                                                     ---------    ---------
                                                     $   3,417    $   3,620
                                                     ---------    ---------

     Depreciation  expense  for the  periods  ended  March 31, 2000 was $203 and
     $168.

                                       8
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 - NOTES PAYABLE

     During 1999,  the Company  issued  subordinated  demand notes payable to an
     officer  and  shareholder,  of the Company in the amount of  $105,000.  The
     notes  bear  interest  at a rate of 10% per annum with  quarterly  interest
     payments,  the notes are due on demand.  Note-holders can demand payment of
     the unpaid  principal  plus  accrued  interest in order to  purchase  other
     equity opportunities in the Company of equal value at any time prior to the
     maturity  date.  During the three  months  ended March 31, 2000 the Company
     issued an additional  $150,000.  Accrued  interest as of March 31, 2000 was
     $5,404.

NOTE 6 - CAPITAL STOCK

     Common Stock - In connection with its acquisition of Subsidiary on July 14,
     1998, the Company issued 500,000 shares of its previously  authorized,  but
     unissued  common stock [See Note 2]. The  Subsidiary  had  previously  been
     funded with $2,000.

     During January,  1998, the Company issued 100,000 shares of common stock in
     connection with the  organization  of the Company at $.01 per share.  Total
     proceeds amounted to $1,000.

     Stock  Warrants - During  1998,  Subsidiary  issued  165,000  common  stock
     warrants to various officers, directors and consultants in conjunction with
     the  issuance  of  subordinated  notes  payable  [See  Note 5].  Due to the
     reorganization of the company [See note 2], the warrants of Subsidiary were
     cancelled,  and re-issued  under the same terms by Parent during 1998. Each
     warrant  grants the holder the right to purchase one share of the Company's
     common  stock at a price of $1 per share.  The warrants may be exercised at
     any time prior to March 1, 2003. An additional  30,000 warrants were issued
     subsequent to December,  1998. The Company has accrued additional  interest
     expense for warrants  issued after  November 1999 as the exercise  price of
     the warrants were less than the arbitrary  value of $2.00  proposed for the
     Company's upcoming stock offering.  During 1998, $37,500 was capitalized as
     prepaid interest expenses and is being amortized over the life of the note.
     All amounts were expensed in 1999.  An  additional  $30,000 was expensed in
     1999 and will be amortized over the life of the note.

     Stock Option Plan - During January,  1998 the Company  implemented its 1998
     stock option plan.  The plan provides for 1,000,000  shares of common stock
     to  be  reserved  for  issuance  to  officers,  directors,   employees  and
     consultants as employment incentives. As of March 31, 2000, no options have
     been issued under the plan. Options granted under the plan vest over a five
     year period.

     Non-Qualified  Stock Options - As of March 31, 2000, the Company has issued
     a total of 500,000 options outside of the 1998 stock option plan to various
     officers,  directors  and  consultants  of the Company.  These  options are
     exercisable at $1 per share, and vest over a five-year  period,  based upon
     certain  conditions  specified in the option agreement.  The options expire
     five years from the date of vesting.  As of March 31, 2000,  no options had
     vested.

                                       9
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - CAPITAL STOCK [Continued]

     Public  Offering  of  Common  Stock  - The  Company  filed  a  registration
     statement with the United States Securities and Exchange Commission on Form
     SB-2 under the Securities Act of 1933. The Company sold 100,000  "Units" at
     a price of $2 per Unit,  which  price  was  arbitrarily  determined  by the
     Company.  Each Unit consists of one share of the Company's  $.001 par value
     common  stock sold at $2 per share,  one "Class A Warrant" to purchase  one
     share of common  stock at $3 per share,  one "Class B Warrant"  to purchase
     one share of common  stock at $5 per share,  and one  "Class C Warrant"  to
     purchase  one share of common stock at $10 per share.  All warrants  issued
     under the  offering  will expire on December  31,  2003.  The  warrants are
     callable if, after one year from the issuance date, public trading develops
     and trading  occurs for at least 20  consecutive  days.  The  warrants  are
     callable at $.01 per warrant  upon 30 days notice by the Company to warrant
     holders. The Units will be offered and sold by officers of the Company, who
     will receive no sales commissions or other  compensation in connection with
     the offering,  except for  reimbursement of expenses  actually  incurred on
     behalf of the Company in connection with the offering.

     Retirement of Notes Payable - During 1999, the Company retired  $330,000 of
     the principal  balance of  Subordinated  Demand Notes Payable and $5,362 of
     accrued  interest for the issuance of common stock at $2.00 per share for a
     total of 167,849 shares of common stock issued. Partial shares were rounded
     up to the next whole  share.  The  Company  also  issued with each share of
     common  stock,  one "Class A Warrant" to purchase one share of common stock
     at $3 per  share,  one "Class B Warrant"  to  purchase  one share of common
     stock at $5 per share,  and one "Class C Warrant" to purchase  one share of
     common stock at $10 per share.  All warrants issued will expire on December
     31,  2003.  The  warrants are callable if, after one year from the issuance
     date,   public  trading  develops  and  trading  occurs  for  at  least  20
     consecutive  days.  The  warrants  are callable at $.01 per warrant upon 30
     days notice by the Company to warrant holders. Although Management believes
     the  issuance  of stock and  warrants  to reduce  this debt is exempt  from
     registration with the Securities and Exchange  Commission,  the possibility
     exists that it may ultimately be determined  that the exchange of stock and
     warrants for debt was not exempt.

NOTE 7 - INCOME TAXES

     The Company  accounts  for income  taxes in  accordance  with  Statement of
     Financial  Accounting Standards No. 109 "Accounting for Income Taxes". SFAS
     109  requires  the Company to provide a net  deferred  tax  asset/liability
     equal to the expected  future tax  benefit/expense  of temporary  reporting
     differences  between  book and tax  accounting  methods  and any  available
     operating loss or tax credit  carryforwards.  At March 31, 2000 the Company
     has  available  unused   operating  loss   carryforwards  of  approximately
     $818,000,  which may be applied  against  future  taxable  income and which
     expire in 2019.

     The amount of and ultimate  realization  of the benefits from the operating
     loss carryforwards for income tax purposes is dependent,  in part, upon the
     tax laws in effect,  the future  earnings of the Company,  and other future
     events,  the  effects  of  which  cannot  be  determined.  Because  of  the
     uncertainty  surrounding  the  realization  of the loss  carryforwards  the
     Company has  established a valuation  allowance  equal to the tax effect of
     the loss  carryforwards  and,  therefore,  no  deferred  tax asset has been
     recognized  for the loss  carryforwards.  The net  deferred  tax assets are
     approximately  $300,000 as of March 31, 2000 with an  offsetting  valuation
     allowance  of the  same  amount  resulting  in a  change  in the  valuation
     allowance of approximately  $31,000 during the three months ended March 31,
     2000.

                                       10
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - LOSS PER SHARE

     The  following  data show the amounts used in computing  loss per share and
     the effect on income and the weighted  average number of shares of dilutive
     potential common stock for the periods presented:


                                             For the Three        From Inception
                                             Months Ended         on January 26,
                                              March 31,            1998 Through
                                         ---------------------       March 31,
                                           2000        1999            1999
                                         ---------   ---------      ----------
       Loss from continuing
         operations applicable to
         common shareholders
           (Numerator)                   $ (84,820)  $ (92,960)     $ (818,688)
                                         ---------   ---------      ----------
       Weighted average number of
         common shares outstanding
         used in loss per share during
         the period (Denominator)          867,849     600,000         753,392
                                         ---------   ---------      ----------

     Dilutive  earnings  (loss)  per share was not  presented,  as its effect is
     anti-dilutive.

     The  Company  had at  March  31,2000,  options  and  warrants  to  purchase
     1,333,547  and 80,000 shares of common stock ,  respectively,  at prices of
     $1.00 through $10.00 per share,  that were not included in the  computation
     of diluted loss per share because their effect was anti-dilutive

NOTE 9 - COMMITMENTS

     The Company has agreed to compensate a majority shareholder, who is also an
     independent  contractor to the Company,  for her services to the Company in
     shares of the Company's restricted common stock. The exact number of shares
     has yet to be  negotiated  with the board of directors of the Company,  and
     may be subject to vesting  rights  imposed by the Company.  No amounts have
     been accrued in the accompanying financial statements for this agreement to
     issue stock.

NOTE 10 - SUB-LEASE AGREEMENT

     During 1998,  the Company  entered  into an  agreement to sub-lease  office
     space.  The term of the lease is 10.5 months,  with no option to renew. The
     agreement terminated on June 1, 1999. Total base rent amounts to $6,300 and
     is due in monthly  installments  of $600.  During 1999, the Company renewed
     the lease for an additional year at $620 a month.

                                       11
<PAGE>

                      BALANCED LIVING, INC. AND SUBSIDIARY
                          [A Development Stage Company]

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 - RELATED PARTY TRANSACTIONS

     Management  Compensation  - The  Company  paid  $12,000  in  salary  to the
     Company's  President/Secretary-Treasurer  during the period ended March 31,
     2000.

     Notes  Payable  -  As  of  March  31,  2000  the  Company  had  outstanding
     subordinated demand notes payable to an officers,  directors,  shareholders
     totaling $255,000 [See Note 5].

NOTE 12 - GOING CONCERN

     The accompanying financial statements have been prepared in conformity with
     generally accepted accounting principles which contemplate  continuation of
     the  Company  as  a  going  concern.   However,  the  Company  has  current
     liabilities  in excess of current  assets,  has  incurred  losses since its
     inception  and has not  yet  been  successful  in  establishing  profitable
     operations.  Further, the Company has a stockholders deficit. These factors
     raise  substantial  doubt about the ability of the Company to continue as a
     going concern.  In this regard,  management is hopeful that it can generate
     adequate   capital   through   improved   operations   and   reductions  in
     expenditures. If necessary,  management will raise additional funds through
     loans and/or  through  additional  sales of its common  stock.  There is no
     assurance  that the Company will be successful  in raising this  additional
     capital or achieving profitable operations. The financial statements do not
     include  any  adjustments  that  might  result  from the  outcome  of these
     uncertainties.

                                       12
<PAGE>

                          PART I FINANCIAL INFORMATION

ITEM 2 Management's Discussion and Analysis.

Balanced Living is a new enterprise and a development stage company.

In the first quarter of 2000 we presented  one (1) seminar,  compared to six (6)
seminars  presented in the same quarter last year.  Management was occupied with
developing the new stand alone  products  described in the Annual Report on form
10-KSB for the year ended December 31, 1999, and decided to devote the available
funds and time to that project rather than additional seminars. We hope to begin
to schedule seminars in the second quarter of 2000 and to recommence that aspect
of our business continuously thereafter.

We have not yet sold any products outside of our seminars,  although development
of such  products is on track for  projected  sales  commencing  as early as the
second quarter of 2000.

Balanced Living  continues to operate at a loss,  although at a lower loss level
than  during  the first  quarter  of 1999.  The reason for the lower loss in the
first  quarter of 2000 than in the same  quarter  last year is the lower cost of
sales  resulting from the absence of seminars  presented in the first quarter of
2000, as well as a modest cutback in general expenses.

We continue to  anticipate  achieving  increasing  average  seminar  revenue per
attendee  during 2000;  and as a result of that and  opportunities  to offer and
sell products  outside of seminars,  we believe we can become  profitable by the
end of the third quarter in 2000.  This timing of  profitability  may not happen
due to risks inherent in our business. Such risks include:

o    the failure of our new stand alone products to gain customer  attention and
     satisfaction,

o    competition from better financed sources of intellectual property,

o    changes in consumer spending on personal improvement products and services,
     and

o    the inability of Balanced  Living to achieve enough funding from revenue or
     loans to enable  continued  operation of the Company and the acquisition of
     sufficient inventory to support continued sales and seminar offerings.

We began to raise  needed  equity  capital  through our public  offering,  which
closed on August 15, 1999.  This offering  raised  $200,000.  Unfortunately,  we
began trying to raise this money in late 1998,  and we were not able to commence
the offering until June 1999. It took us another 45 days to raise the funds from
investors.  By the time the money  came in, we needed to use almost all of it to
pay  overdue  short  term  credit  lines,  accounts  payable,  and to  fund  the
regulatory  steps to commence and support a public  market in our shares for the
benefit of our  shareholders.  (The  challenges  and costs of this public market
listing  effort  continued  through  the  end of  1999  and  into  2000).  Since
commencing and then concluding our public offering,  we have engaged in valuable
revised  business  planning  and  projections,  which have  considered  both the
current level of growth, upcoming new revenue sources, and the level of overhead
and  advertising  that will be needed to  maximize  the  business  opportunities
facing us.

We recognize the need for  additional  capital  funding beyond the amount netted
from the public offering. In this regard we borrowed an additional $150,000 from
affiliates during the first quarter of 2000,  increasing our outstanding related
party debt to ($255,000).  Our current  liabilities  are well above the level of
our  current  assets,  and the cash on hand at March 31,  2000 is not  enough to
cover operating  expenses much past the end of the second quarter.  The level of
current  liabilities  is  because  the  notes we have  issued to  affiliates  to
represent the funds borrowed over time are demand notes, and thus are

                                       13
<PAGE>

characterized as current liabilities. These affiliates will treat these loans in
a much  different way than would a third party bank lender under the same terms,
and we do not anticipate  foreclosure  or legal  proceedings to collect on these
affiliate  notes  notwithstanding  it is unlikely  that these notes will be paid
during 2000.

We are  currently  exploring  avenues for  achieving  added  financial  support,
including  seeking  additional  equity or debt infusions  from certain  existing
shareholders  or from  one or more new  private  investors,  and/or a  strategic
business  combination or  relationship  that could bring the strength of another
company to aid in the success of Balanced  Living.  There are no  commitments or
plans now in place with respect to any of the avenues being explored.

     Forward Looking Statements and Risks

The  information  other  than  historical   information  in  this  report,   and
specifically  the  information  set  out in this  section,  is  forward  looking
information  presenting  management's  beliefs and  estimates  about the future.
These beliefs,  plans and estimates are subject to significant risks,  including
an inability to recruit,  hire, and retain skilled  seminar  facilitators,  or a
copyright  infringement  of Balanced  Living's unique  curriculum  materials and
products and resulting  litigation,  as well as risks from the general  economic
conditions  within  which the  Company  must  operate..  Other  risks could also
negatively  effect Balanced  Living's  ability to meet its projections for 2000.
These risks include:

         Balanced  Living's limited operating history increases the risk of loss
         to investors.

         Balanced  Living  was formed in July  1998,  and is in the  development
         stages of its business  plan. It has no  significant  assets,  has just
         begun  business  operations,  and considers 1998 and early 1999 to be a
         period of research and development. Upon completion of this offering it
         will still be  uncertain  as to whether  we can  continue  successfully
         implementing our business plan or that we will ever operate profitably.

         If Balanced Living does not obtain enough money to continue to operate,
         investors will lose their investment.

         We have no significant assets or operating  capital.  Balanced Living's
         auditors deem us a going concern,  being totally dependent upon receipt
         of the  proceeds  of this  offering  to  provide  the  working  capital
         necessary to continue the  development of our business plan. We have no
         commitments for additional cash funding beyond what we have obtained to
         date.  In the event that our current  resources  are not  sufficient to
         move us to  internal  funding  and  profitability,  we may need to seek
         additional   financing  from  commercial   lenders  or  other  sources,
         including  additional  sales of equity,  for which it presently  has no
         commitments or arrangements.  Additional financing may not be available
         to Balanced Living on acceptable terms, if at all.

         We rely on Rose Blackham and her continuing  service to Balanced Living
         for the success of the Company.

         Balanced Living also relies heavily on the training,  teaching methods,
         and curriculum of Rose Blackham,  which is provided to Balanced  Living
         by  independent  contract.   Currently,   Ms.  Blackham  is  the  chief
         facilitator of our seminars,  although not an officer or director.  The
         stability  and  growth  of  Balanced  Living  would  be   significantly
         compromised  if Ms.  Blackham were unable or unwilling to perform these
         responsibilities.  We do not  carry  key  person  life  insurance  with
         respect  to any  employee  or  contractor,  and we have  no  employment
         agreements.

                                       14
<PAGE>

         If  Balanced  Living's  managers  spend  too much  time in their  other
         pursuits, or if they use related companies to profit from dealings with
         Balanced Living, the investors may lose their investment .

         Many of the  services and goods  acquired by Balanced  Living have been
         and will likely come from sources connected in some way with members of
         our management  team.  Some members of the  management  team have other
         interests which could give rise to conflicts with respect to the amount
         of time devoted to Balanced Living. We presently have no way of knowing
         if any  conflicts of time and interests  will be resolved  favorably to
         Balanced Living.

         Investors' money may be lost if Balanced Living's products and services
         are not accepted by women in the market place.

         Balanced  Living's  business  plan is based upon the  experience of the
         Balanced  Woman  Seminars  given  to  date  and  the  observed   market
         acceptance of related products and services.  We can not determine with
         any accuracy the exact market  share,  if any,  that we will be able to
         achieve for Balanced Living's products and services.  Balanced Living's
         business will be subject to all the risks associated with the packaging
         and  introduction  of new seminars and product  lines for sale into the
         competitive self- improvement seminar market for women.

         An investment in Balanced Living may be lost if our  proprietary  works
         and concepts are stolen or infringed.

         Balanced  Living  relies  primarily on copyright  laws and employee and
         third  party  nondisclosure  agreements  to  protect  its  intellectual
         property.  We have  completed  the  registration  and  copyright of our
         trademarks,  word mark,  service mark,  and the copyright of all of the
         materials  used in the  seminars.  Rose  Blackham has  transferred  all
         rights to any  pre-existing  concepts and materials to Balanced Living.
         Unauthorized  copying of its  products  and  services  could  damage us
         significantly.  Although we are not aware that any of our  products and
         services are materially infringing the rights of others, it is possible
         they are. If so, we could have to modify our products and services,  at
         substantial possible cost. Balanced Living might be subject to lawsuits
         if it is  alleged  that it is  infringing  on the  property  rights  of
         others.  To combat  intellectual  property  risks,  we have secured the
         assistance  of an  intellectual  rights  attorney  and are taking every
         measure  possible  to protect  and  copyright  all of our  intellectual
         property and proprietary products and seminar materials.

         An economic  slowdown or change in consumer spending habits could cause
         you to lose your investment in Balanced Living.

         Balanced Living  provides  products and services that are not essential
         to the support of life. In the event of significant  economic downturns
         in the United  States or the World  caused by any or all of a number of
         potential  causes,  the demand for our  seminars  and  products  may be
         significantly reduced and we may not be able to generate enough revenue
         to maintain operations.

                                       15
<PAGE>

PART II   OTHER INFORMATION

ITEM 1    Legal Proceedings

None

ITEM 2    Changes in Securities

None

ITEM 3    Defaults on Senior Securities

None

ITEM 4    Submission of Matters to a Vote of Security Holders

None

ITEM 5    Other Information

None

ITEM 6    Exhibits and Reports on Form 8-K

a) Exhibits

None

b) Reports on Form 8-K

None

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

BALANCED LIVING, INC.

/s/ Jeannene Barhalm                                             May 12, 2000
-------------------------                                       ---------------
      President                                                      Date

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