What it means:

Excel shows the “#NUM!” error when a formula or function contains numeric values that aren’t valid. It is very rare, and unlikely you will see this error.

Typical causes:

This may happen if you enter a number using certain symbols. For example, if you entered $1,000 in currency format in a formula, Excel could this that this is text or a formula rather than a number and be confused, because dollar signs are used as absolute reference indicators and commas as argument separators in formulas.

How To Fix It:

To avoid the #NUM! error, always enter values as unformatted numbers, like 1000. Excel will then apply number formats automatically afterwards.

The other case is where certain specific types of formula can’t find an answer. An example is IRR (for internal rate of return) that will return #NUM! if it can’t find a value that works. This tells you that an IRR can’t be calculated for the current set of input assumptions (e.g. cash flow is always positive or always negative), rather than the model is broken.