The #1 thing that causes the most stress in our lives is money.
So how can you manage it and stay sane?
By acting like a “CFO” for your life.
Let’s go.
What is a CFO?
A CFO is a Chief Financial Officer (CFO).
They are responsible for managing the financial actions of a company.
Their main duties typically include:
1. Financial Planning and Analysis: Developing budgets, forecasts, and financial reports to guide the company’s financial strategy.
2. Reporting: Preparing and presenting financial statements and reports to the executive team and the board of directors.
3. Risk Management: Identifying financial risks and implementing strategies to mitigate them.
4. Cash Flow Management: Monitoring cash flow and ensuring the company has the necessary funds to meet its obligations.
5. Investment/Capital Allocation Oversight: Evaluating investment opportunities and managing the company’s capital portfolio aka where to play that hard-earned cash to generate the highest returns.
6. Compliance: Ensuring that the company adheres to financial regulations and standards.
7. Team Leadership: Leading the finance and accounting teams, overseeing their performance, and ensuring effective processes are in place.
8. Strategic Decision-Making: Collaborating with other executives to shape the overall strategy of the organization from a financial perspective.
There are just a few of the main duties of a CFO.
How to apply “CFO” thinking to your life
In my +15 years of finance and strategy experience along with being both a Founder and a Fractional CFO to companies, I have learned that managing money is one of the most important skillsets one can have.
And it’s even more true in our personal lives.
Just like a CFO does in their day-to-day role, ask lots and lots of questions.
- What are our key financial metrics and how do they compare to our projections? (aka your goals and how are you tracking towards them)
- Are we on track to meet our revenue and profit targets for the quarter? (aka am I meeting my goals? Why or why not?)
- What are the major drivers of our current financial performance? (aka what specifically is allowing me to either a) hit my goals or b) miss them?)
- How accurate have our forecasts been historically, and what adjustments can we make moving forward? (aka am I reasonably hitting my goals or do I need to re-adjust?)
By asking questions, you’ll be thoughtful in how you approach money.
And thereby more likely to hit and achieve your goals.
Conclusion
Think like a CFO when it comes to your money.
You’ll more than likely start hitting your financial goals because you’ll be more thoughtful and decisive.
You’ll know the what’s, the why’s, the how’s, and the where’s of your money.
Ultimately, you’ll have a better handle of your money.
Which you worked so dang hard for. 🙂
