How watching PnL’s can help with debt management

Do you know how to successfully and easily read your PnL? Moreover, do you fully understand what that document is or what to use it for? Or are you like many of us who aren’t sure how to apply the information!? Well, if that’s you, you’ve come to the right place – DAT is here to help!! Analyzing your PnL’s can help debt management. Let us explain:

Managing your debt is key!

We are proud to say that most of our clients are becoming PnL masters and using the data to pay down (if not pay off) their debt! They’re creating the life they want to live with the financial freedom to do so!

Is it really that easy? YES! Watching your numbers and knowing where your money is not only going, but also coming FROM, is crucial. Besides, it makes a massive difference in the success of your debt management and practice profitability. Consistent financial monitoring is the key to achieving long-term stability and success.

Here are a few tips on how to start using your PnL’s to help manage your debt:

• Schedule yourself 1 hour per month dedicated to looking at your PnL, bank accounts, debt and any other accounts that may need attention like investments, 401k, etc. – let’s call this your Monthly Financial Review!
  • Pro Tip!! Schedule this for after the 15th of the month, it typically takes a couple of weeks for your accounting team to be done reviewing your accounts
• Communicate with your bookkeeper to ensure he/she knows you’d like to have a clean PnL delivered by the 15th of each month
• Learn to use QuickBooks or another accounting software to help you track expenses easily!
• Come to your monthly financial review meeting ready to GSD!!
  • PnL in hand
  • Logins ready for all online accounts you’ll be reviewing
  • Water/ coffee/ tea, whatever you’ll need! And maybe a little snack too!
• Review your numbers for trends!
  • What’s looking GREAT?
  • What needs some work?
  • Does the spending look like what you expected? If not, what’s different?
  • Is your profitability where you want it? If not, where do you see that adjustments can be made?
  • Is there anything that needs to be addressed or implemented in the next 30 days to create a change in your profitability?

Listen Doctors, this is a fun and quick overview of something that can take a bit to get REALLY great at! First, use your resources. Then, reach out to the people who can help you learn it and decipher it, or even someone who can give that 3rd party perspective on the situation. Finally, learn to HAVE FUN with the numbers.

If you are looking for more tips and tricks, make sure to listen to our podcast!

As always, we are here for you! If you have questions or need some guidance, please reach out to us at [email protected]