Even though the year is half way over, I think it is important to establish my goals for the remainder of 2104. There are two financial marks I desire to reach and two different personal marks. In addition I want to discuss long term goals.
2014 Goals
Goal # 1 – Maintain at least a 50% savings rate for 2014
I think that I am at a good start in this area, although I did have a lively debate with Dividend Mantra over what should be considered an expense. I would prefer to hit 60% in this category, but I have a huge expense that will be occurring either this month or the next. I contemplated capitalizing this expense, but I don’t think it will increase my home value dollar for dollar necessarily. It may, but I don’t plan on selling my home either.
Goal # 2 – Reach $45,000 Net Worth by year end
Originally I was going to go for $50,000, but as I said I have a large upcoming expense, that I will post about when it is all said and done.
Goal # 3 – Get Below 180 pounds
At the beginning of the year, I didn’t think I would get that low. At this point, I really should crush this. Should I adjust it lower? Not sure, I did start the year at 215 and I am at 186 now, but it fluctuates too. So if I can maintain under 180 by the last month of the year, I will be happy.
Goal # 4 – Fix Crap Around the House
This is a major one for accountability and it will be my biggest challenge learning wise. I don’t know why I don’t have a solid understanding of working around cars or a house. Both my dad and father in law are very capable handymen, so I really don’t have an excuse as I have people I can turn to. Anyways, I figure if I post the 3 main things I need to get fixed here before winter comes, I will look like an idiot for not getting these done. There are other projects I would like to work on as well, but these are the most urgent (and I have already purchased the supplies to do two of them at the time of posting).
Chimney That needs to be repainted.
This one might be the hardest for me, need to replace the brick mold, threshold, and door jams on the garage back door as the bottom has rotted.
Need to pressure wash and stain the deck
Now if I don’t get some after pictures up before winter I hope someone bugs me about them!
Long Term Goals
These are more of guidelines of when I hope to reach certain major milestones, but I think that winning the small battles (yearly goals) will result in these long term goals being accomplished.
Pay Off All Debt by Age 40
I have actually slowed this down, I was on track to get this nailed out by sometime in 2021 (or 34 years old), but my retirement strategy will be utilizing the ROTH IRA and I need to start contributing to those so that it will be possible. Right now, I have my direct deposit setup to bi-weekly fund my mortgage paying account. This means I make an entire extra principle payment each year (or two 1/2’s, because I don’t sit on the money), and also each month will be $190 over the minimum payment. With nothing else, the loan will be paid off in October of 2026. But I anticipate it being a bit earlier for a few reasons. One is that I throw my chase credit card rewards earned to the principle of the loan. Two is that if my escrow increases during these 12 years, those two extra direct deposits will be larger and pay down the balance quicker. If for some reason the escrow decreases in a year, I can keep the same payment and pay it off quicker that way as well.
Complete a ROTH IRA Pipeline
This is the major reason I am spacing out my loan payoff timeline. I need to work on contributing to the wife’s and my ROTH accounts to have a contribution balance available to withdraw. Now if I am retiring before I have 5 years of contributions made to cover my expenses (yay!) I can make up for this short fall in taxable accounts or side income to get me through the first 5 years. After this my conversions from 5 years ago will be my available balance to withdraw in the present year. I think I may play it on the safe side and convert more than I expect to need initially. This will give me some flexibility moving forward to control how much and when I make withdrawals, plus a buffer if inflation is high in those first few years.
Reach Financial Independence by Age 46
This isn’t as hardcore as a lot of personal financial bloggers out there. But I will probably have a few lifestyle changes during this journey which will probably make it difficult to exceed 40% savings rates in the future. I personally think I will hit this mark somewhere between age 46 and 50, but I want to be an optimist and shoot for the lower end of my range. We will see where life takes me on this path, maybe it will be faster, maybe it will be slower.
Those are very good goals! I think you’ll have to raise the benchmark at year end! I should look at mines again and see where I’m at. Keep up the good work!
Cheers!
While I would enjoy to raise the benchmark I have a large impending expense as I mentioned. Also, possibly next year I expect there to be some lifestyle changes, which I alluded to in my income/expense post where I mentioned my health insurance costs may be changing (possibly this fall with open enrollment).
This is a great list of goals!
Between our house and our two rentals, there is always (ALWAYS) something to fix. I feel ya on that front!
Good luck with everything!
Rentals.. I like the concept, but not something I would consider until I increase my skill set and my wallet. Working at my last job I could see how some people lived just off of managing their own rentals. Having access to that information made me interested and it may be something I consider in the distant future.
Thanks for stopping by!
Good luck on these goals you’ve set. I think it’s good that you are being well rounded with paying debt but also contributing to retirement investments at the same time. Reassessing your target date accordingly, certainly makes sense!
Yea I think being well rounded is the key. I certainly do not like debt, but I have a reasonable balanced plan to tackle it along with building my savings for early retirement. With limitations to ROTH contributions I can’t just go head strong on debt then switch to ROTH contributions, so I think being diversified in debt repayment and savings is the best approach.
And yes, the long term goals are more of guidelines and will be reassessed very thoroughly as I actually get close to the targets. Expenses can change over a decade longer in my life just with inflation and not to mention lifestyle (some things may decrease as I get more frugal, others can increase once kids arrive).