Judge Your Personal Finances Like A Company Would!
If you do any investing or follow the stock market at all, you will often hear a company report its earnings every quarter and also every year. Often investors are looking for a couple of indicators including revenue and net income.
I started wondering if I could judge myself the same way. So here is a base effort, to be updated once numbers are final for 2006:
Revenue - My base salary increased 9% from where it was at the beginning of the year. Once I do my tax return, I'll have a better idea of what my other revenue was including: bonuses, capital gains, interest and dividend income. I'll post an update once this is done. I also have to add my fiance's results into this.
Analysis: While 9% is not bad, I felt I could have done better. I imagine my final revenue number will actually be about 11% higher than the previous year. When setting goals this year, I would like to see this number increase by 15% or more next year.
Net Income - I don't know my own net income, but my fiance and I started the year with a combined net worth of $34,514. As of November 30th we are at $102,480. So our net income for the year was $67,966. We don't have any numbers from 2005 to compare to. But as a percentage of net worth, our net worth increased by 197%.
Analysis: I'm extremely pleased with this part of our financial picture. This was a big year for us. I think if a real company reported net income numbers like this, they would be rewarded by getting a bump in their stock price.