Knowing your numbers means you can answer four questions in under a minute: what came in last month, what went out, what you paid yourself, and what’s set aside for tax. Look at them every month, not at tax time. Start with three reports: profit and loss, balance sheet and cash flow.
The polite advice is “get a bookkeeper.” Lovely. Now you have a bookkeeper and a monthly PDF, filed unread in a folder called Finance, right next to the folder called Finance OLD.
Smart founders don’t avoid their numbers because they can’t count. They avoid them because the numbers might say something rude. One accounting firm founder who has spent more than a decade inside other people’s books put it simply: “fear comes from a lack of understanding.”
It isn’t only the new or the small. She has seen businesses that are, in her words, “great. Successful businesses, but their books are a mess.” Her reaction to one of them: “how are you this million dollar company and you don’t have any books.”
And the money stress is common. In the Federal Reserve’s 2025 Report on Employer Firms, 56% of small businesses named paying operating expenses as a financial challenge and 51% named uneven cash flow. Half the room is quietly sweating about cash. The other half isn’t looking.
Book a monthly money date
Same day every month. Coffee, door shut, phone face down. The number one mistake she sees: “People ignore their numbers. They wait until tax time to put their numbers together.” By then it’s too late to change much. A monthly look turns April’s horror film into a series of small, boring decisions. Boring is the goal.
Learn three reports, not thirty
- Profit and loss (income statement). What came in and what went out over a period. It tells you if the business made money.
- Balance sheet. What you own and what you owe at one moment. The SBA calls it “the foundation of managing your finances” and says it tracks your assets, liabilities and equity.
- Cash flow. When money actually lands and leaves. This is how a business can be profitable on paper and broke on Thursday.
Ask your bookkeeper to walk you through all three once. Then ask the dumb questions. They aren’t dumb, and you’re paying for the answers.
Pay profit, tax and yourself first
The traditional equation is income minus expenses equals profit. The Profit First method she uses flips it: “you take income minus your profit, and then whatever’s left is what gets spent on expenses.” Her clients run five bank accounts: income, operating expenses, taxes, profit and owner’s pay. Every week, a set percentage moves from income into each one. Tax bills stop being surprises. Your salary stops being whatever’s left on the 30th.
Interrogate every expense
Pull last month’s statement and ask each line the question she asks her clients: “Do each of them have a purpose and an explanation?” The meditation app you opened once in January does not have an explanation. Neither do the three project management tools your team doesn’t use.
Watch one number, not all of them
Pick the number that tells you the most about your business. Cash in the bank, profit margin, revenue per client, whatever it is. Check it weekly. Everything else can wait for the money date.
Hear it from someone who’s done it
Megan Schwan, founder of the virtual accounting firm Sidekick and a certified Profit First professional, has watched clients go from scared of their numbers to leaning into them. “Every decision goes back to your numbers, whether you know it or not,” she says. “So the more you can understand them, the more you can lean into them, the more you’re gonna understand what’s happening.” Jump to 32:10 for the part about money fear and where it comes from, or listen to the full episode.
Questions women ask about their numbers
How do I stop being scared of my business finances?
Look at them more often, not less. Book the monthly money date, ask your bookkeeper to explain one report at a time, and the numbers become a routine instead of an ambush.
I make decent money but never know where it goes. What do I do?
Separate it. One account for everything is how money disappears. Split income into set accounts for tax, profit, your pay and running costs, then review the operating account line by line once a month.
What financial reports should every business owner understand?
The profit and loss, the balance sheet and the cash flow statement. Profit and loss tells you if you made money. The balance sheet tells you what you own and owe. Cash flow tells you whether you can pay everyone on Friday.
Next step: listen to the full episode for the subscription audit and the three money mistakes she sees most.