This could be the most common piece of financial advice that people are resistant to, which is that you need to know your numbers, or have them organized and easy to access, or hire a professional to take care of that for you.
But why? Well, knowing your numbers will help you to gain an awareness of where you are today, and provide information and guidance for the action steps you need to take to reach your goals. It’s a part of the process of this journey you’re on to live your best life, and the numbers are simply data that will help inform your strategic decision making.
So then why are so many people resistant to this? Well, it’s emotional. You don’t want to feel the shame and failure that you think your financial numbers represent. You get overwhelmed, frustrated, and end up giving up. You figure you’ll get to it one day but never end up making it a priority.
I mean, the list goes on and on, but it’s mostly rooted in fear. No shame in that by the way, that’s just a part of being human, we all have money fears, and confronting them is part of the process.
For example, I’ve avoided looking at my business revenue and expenses because it didn’t show me the numbers I wanted to see, and because of that, I was a failure, and the worst business women ever. I know, I know, I’m a little dramatic, but you get it right?! You’ve been here?! In a situation where you’ve avoided the numbers because that’s what feels safe, and the alternative of looking at the numbers, is SCARY.
I’ll tell you girl, once you rip off that bandaid and peak under the hood, you’re going to be glad you did. Sure, those emotions will come up, and need to be worked through and healed, BUTTT the benefits are too great to not do this.
Imagine being able to know your numbers and feel good about them. Feel confident about your finances, like you’re in control. Learn the skills you need to not only know your numbers, but understand them. See the numbers for what they truly are – just numbers, just data. Your numbers do not define you. They are a tool that you can use to support you on your journey to living your best and most authentic life.
So what financial numbers should you know?
Assets – these are the things that you OWN. How much cash you have, investments, the value of your home and other property you may own, retirement accounts.
Debts – this is money that you OWE. Think credit cards, student loans, mortgages, car loans, business loans. It’s always good to know your monthly payment and your interest rate as well.
Income – how much money you MAKE. Things like business income, profit, salary, bonus, commissions, rental income.
Expenses – how much money you SPEND. Your bills, fun money, business expenses, just living.
Savings – how much are you putting away for goals? You may be saving into a savings account, retirement accounts, investments, travel fund.
Insurances – what benefits will you or your family receive if you sadly were sick or passed away? Sickness and death can create financial distress for your family. Insurance will protect your family in these worst case scenarios.
You got this, girl! The best way to grow on your financial journey is to continue to show up and commit to the practice of taking care of your financial health and wellness. This is just one way to take action in a positive way and get grounded in where you are right now.
As always, I am here to serve. Schedule a free 30 minute money chat with me and we can start to apply these learnings to your unique financial situation.