How exactly to "review your numbers"? What does it really mean to "know your numbers"?

Описание: Finance Learning Lab: https://financelearninglab.com/
How do you review and know your numbers so there's two different things that you can kind of look at whenever you're talking about like knowing your numbers and a big trap that people fall into is focusing all of their attention on what happened in the past so they'll dive deeply into what happened last month what happened last quarter what happened last year and that is a good place to spend a little bit of time on to kind of gauge a little bit of a sense of what your trends are where things have been going but let me ask you a question do you want your business outcomes to be the same next year as they are now most people say no most people want to grow their business most people want to take their business to another level so looking at what happened before is not necessarily going to be what takes you to that next level what you ultimately should be spending more of your time when you're reviewing your finances is actually imagining yourself it is new year's eve and you're celebrating and you had an amazing year and you're looking back and you're saying I made X number of dollars okay you know whatever that number of dollars is for you and your business and you're looking backwards and you're trying to save for me to hit that number how many months are left in the year and what do I need to do how do I reverse engineer from there and course correct so what you want is whenever you're looking at your numbers from the first part of the year or the last year you want to look at it through the lens of so what what do i need to course correct to get myself here because if you spend too much time looking back here you're more likely to end up the same spot you're not going to hit the trajectory that you want to hit with your business okay so when you're actually looking through those numbers you're looking through them with trends and every single time that you're looking at them you're saying so what and there's really two questions that you want to elaborate on that so what for if it is revenue you're going to be telling yourself so what can i do to increase revenue if it's expenses you want to say so what can I do to be smarter about this and when it comes to being smarter about your expenses you're going to want to think short term and long term okay so a short term thing is to look at you know look at your let's say business cards um and say you know what I can save myself 20 by not spending money on business cards okay you can do that but that might cost you over the long run right so you want to always be toggling back and forth when you're looking at your expenses from the perspective of this so what is so what can i do to minimize these expenses but minimize them without having a negative impact on what your top line revenue is okay so just get yourself in the habit of looking through the results you're getting every single month and is it getting you closer to where you're trying to go but go into it with that frame of mind of where am I trying to get to where am I currently and what do I need to course correct right so you might have a goal set for every single month once you kind of set your end of the year goal you reverse engineered every single month you're going to know okay next month is going to be July what do I want to have happen in July. July rolls around you look and you didn't actually hit that the target. You're going to be saying okay so what so what am I going to do different in august to be able to boost that and you might even look at your expenses and you say where do I actually want to spend more to crank up the speed on some different things okay so how you look at your finances and how you know your numbers is always through the lens of so what what course correction do I need to do to be able to help me hit what my end of year goal is okay get yourself comfortable with it get yourself familiar with it of course the first time you're looking at it it's it's going to feel a little bit awkward it's like anything right the first time you tied your shoes it felt a little bit hard now you could tie your shoes you know practically with your eyes closed right the same thing happens when it comes to reviewing your numbers i would say at a minimum the frequency that you want to be looking at them is monthly but whenever you're in a really high growth industry you probably want to be looking at some of those indicators a lot more frequently than that okay so at a very bare minimum monthly but probably a lot faster or a lot more frequently than that and you'll find that looking at it more frequently when you look at it through the lens of where you want to go is going to help you get to where you want to go faster.

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