It’s that time of year again. When we make promises to ourselves to be better. It’s time to make some New Years Resolutions. I believe far more people fail their New Years Resolutions than succeed. The idea seems so good and so easy going into January, but once February rolls around, everyone loses steam. However, I still think it’s far more important to try and fail, than to give up from the start. So here we go, these are my goals for 2014.
At the end of 2013, we’ve had to face some major extra costs. We decided to get a used ’98 Jeep Grand Cherokee so we would have 2 cars for the Winter months. This set us back a few thousand dollars between getting it, registering it, and getting some small repairs. It’s still too soon to say if this purchase is going to be something we regret later, but the quality of life increase of having 2 vehicles will pay off pretty soon when my office moves to a new location (no more walking home for lunch).
So, the first thing that will need to happen in 2014, is we will need to get our finances back in order. In January, we plan on minimizing our food bill at the cost of temporary health. My wife and I try to eat pretty healthy, which means a lot of meat and veggies. We tend to break the rules on Saturday to maintain sanity, which usually consists of eating out and sometimes drinking with friends. Since we are currently healthier than we are financially stable, we’ll be eating as cheaply as possible, and cutting out the expensive weekend restaurant visits for at least the next month. After january, we should be financially stabilized and able to resume our healthy eating habits. Additionally, if we can get out of the habit of spending a lot on the weekends, we’ll be able to save more in the future as well.
I’ll try to share any good low budget recipes we find along the way. Hopefully, we can find ways to still make healthy food.
That first goal is important, because the second goal for 2014 is aggressive saving. We are aiming to invest at least $20,000 into our taxable account by the end of 2014. Our stretch goal here is 40% of our income (just under $26,000), but that may be out of reach as there are 2 weddings and 1 bachelor party (where I am the Best Man) that are happening this year.
You may be asking why we are investing in a taxable account. There are a few reasons. First, we are planning on buying a house within the next 2-3 years, which means we will need a decent load of cash for the down payment. Second, our long term goal is to retire early, and that is impossible if our savings are inaccessible until age 60+. Finally, liquidity is the essence of freedom. One reason, many investors hate real estate is that it’s so much work to turn your asset into cash. If we needed to access money in a Roth or traditional IRA, there would be hoops to jump through, and fees to pay on top of the taxes. Our economy is not in a state where a person can assume they won’t need to access their savings for 30+ years.
The final goal for 2014, is to achieve an average monthly dividend income of $50 per month going forward. Obviously our average monthly dividend income is going to be quite low while accumulating assets, so this is more of a goal for results we’ll see in 2015. I just want to be clear up front so I don’t get to December next year and have to say we failed this just because the goal was poorly worded.
How about you, what are your goals for 2014, Let me know in the comments!