Month: December 2018

I recently posted an accounting of how I fared with my 2018 Resolutions / Goals.  With the calendar about to turn over to the new year, I wanted to publicly post my Goals for 2019.  I have decided to call these my goals rather than resolutions.  Resolutions sound more about changes you wish to make for the upcoming year while Goals, to me, sounds more like lasting life changes.  It may be word games, but it is something I wanted to point out.

Another thing I have decided to do for this coming year, is to have my family participate as well.  I won’t publicly display their goals here, but the game plan is to have each person in the family come up with a list of personal growth goals for the year, write them down and then we can revisit those periodically to see how we are each doing and hold each other accountable.  

So, onto my 2019 Goals.  

In 2018, I mentioned a few items where I failed to reach my goal.  I will start with those items in 2019.  My weight is a big one, as it is for many people at this time of year.  I lost some of the discipline that allowed me to lose a significant amount of weight.  I saw my diet slowly but steadily go away from a lower carb, healthier list of foods.  I allowed my sweet tooth to reintroduce itself and this is something I plan on addressing in the coming year.  I am currently nearing 250 pounds, so my goal is to get this back in check.  I plan on doing this in a tiered approach to help me track this and hopefully hold myself accountable.  My goal is to get my weight under 240 by February 1^st.  Then continue along this path and lose an additional 5 pounds by March 1^st.  At that point, would like to hold my weight in that range (below 235) for the rest of the year.  I plan to weigh myself and document it on the first of each month.

The other goal that I failed to reach in 2018 was improving my taxable investment account to over $50K.  On December 5^th, I documented that I had only reached $38k in that account in 2018.  In the three weeks since that post, the account has dropped an additional $4k to $34k.  We are currently in a bearish market so that decline is despite continuing my bi-weekly contributions automatically.  I intend to continue my bi-weekly contributions, currently $525 every other Friday.  This will account for an additional $13,650.  I hope to increase the automatic contributions as well as I continue to find small, incremental savings each month.  But simply taking the additional contributions that are currently planned, that should bring the account to over $47K.  My goal for 2019 will be to find those small, incremental monthly savings as well as finding additional “one-time” contributions throughout the year.  Keeping those goals in mind, but still accounting for market conditions being outside of my control, I would like the end balance to reach at least $55k by the end of the year. 

One new goal for this year is to focus on reducing one of my remaining debt instruments.  This is my Home Equity Line of Credit.  I currently have a balance on this of a little over $37K.  My goal for 2019 is to increase my monthly payments whenever I can comfortably do so and bring that balance below $30,000 by the end of the year.  

The remainder of my goals are similar to last year’s successful goals, so they don’t necessarily warrant discussion.  Below is the full list.1. Keep Weight under 235 (see above for incremental goals)

1. Keep Weight under 235 (see above for incremental goals)

2. Max my 401K contributions

3. Fully Fund Wife’s ROTH IRA (Stretch Goal:  Fully Fund my ROTH IRA as well)

4. Read at least 24 Books & Listen to at least 24 audio books

5. Re-read “The Millionaire Fastlane” by MJ DeMarco & “Set for Life” by Scott Trench

6. Get Vanguard Taxable Investment Account over $55k

7. Pay Credit Cards in full each month

8. Get HELOC Balance under $30K

9. Continue to Blog weekly

10. Earn additional $100 per month in income through various side hustles

So, there you have it.  Those are my goals for the coming year.  If I follow goal #9 and continue to blog through the year, I will report on my progress near the end of 2019.  Feel free to list some of your goals in the comments and perhaps we can work to hold each other accountable.  Thanks for everyone that has read this blog, I truly appreciate all (both, haha) of you!  Happy 2019!!

It is that time of year again.  The holidays.  Whether you celebrate Hanukah, Christmas or any other holiday at this time of year, one thing is the same…. Your budget is at risk.  Growing up, Christmas gifts were measured by height in that you stacked all the boxes and see just how high they were that year.  We got many, many, many gifts.  Earlier this week, I heard a question on a radio show asking what the best gift was that you have ever received as a child.  Sadly, with all those gifts, no one item even stuck out in my memory.  I had several memories of gifts that missed the mark as these have become the stuff of legend in my family but as for that one big game-changing gift, I drew blanks.  

My wife and I have done a very good job of managing our kids’ expectations regarding gift giving.  We get a small handful of gifts but almost each one is something meaningful and hopefully memorable.  

Funny story… one year my parents visited on Christmas.  When the kids FINALLY went to bed on Christmas eve, we stealthily grabbed all the presents from their hiding spots and placed them under the tree.  My parents went to their car where they had hidden the gifts that they bought for our family.  When we looked at the different wrappings, we noticed that the grandparents out-gifted Mom, Dad and Santa combined by a crazy margin.  To avoid any questions, we quickly replaced several gift tags to say that several of the gifts from the grandparents were now from Santa Claus.  My first reaction was guilt, wondering if perhaps we didn’t get the children enough.  I often have that same feeling when I hear stories of what their friends received.  I quickly let those feelings pass and realized that my children have never wanted for anything.  The excitement opening each and every gift has been genuine, and I never got the sense that they were jealous of what others received.  

So, back to the present…. This year more than most, I have finances on my mind.  Partially due to this blog but more so due to the changes I have made in the past year or so.  As the season approached, I did a few things to minimize the sizable impact to our December budget.  I started to order a few gifts awhile ago in order to spread the spending just a bit.  We knew the large gifts that we wanted to get for each kid, so we planned ahead and budgeted for those larger expenditures.  All of that combined to give me a pretty good feeling about the budget this year.  

Well, I totally miscalculated.  It appears that the gifts are not the only budget buster.  As we approach the holiday, we have gone to countless holiday parties, lunches, friend get-togethers, etc.  Each of those has its own costs attached to it.  Whether that is a cash bar, meeting at a restaurant or grabbing those “little” gifts for the people you are meeting.  All-in-all, I am at least conscious of this and doing my best to lessen the impact but overall, these are expenses that I will definitely need to plan better for in the future.  Some things I plan on doing to counter this are: Having a drink or two at home before going out to minimize the bar tab, having a snack at home before going out to minimize the food tab, and planning experiences that we would already do with other families instead of getting together at a restaurant.    

What are your thoughts on how to minimize expenses at this time of year?  Do you think my ideas make sense or am I simply being a scrooge?  Let’s discuss it in the comments section.  

Also, I would like to wish each and every one of you a HAPPY HOLIDAY and want to say thank you for reading.  

Last month I did a rough calculation of my savings rate.  It came to a little over 40%.  This has not been something that I have religiously calculated but realize that it is something that I should follow more closely.  As such, I am going to experiment with updating it publicly on a monthly basis on this forum.  I figure this will help to hold me accountable.

The reason this comes to mind at this moment is that I have recently had a sense that my numbers were skewing in the wrong direction.  I have felt this simply by viewing my credit card spending.  I have made strong progress this year by diverting a decent chunk of money each month to a savings account in addition to my automated money moves into my taxable investment account.  I have noticed that in the past few months I have not been in a position to divert this additional money since my credit card spending has dramatically increased so I have used that money to pay my credit cards off in full each month.

In analyzing the reasons for this increased spending, the obvious culprit appeared to be that we wer nearing the Christmas holiday and we have done some shopping.  Rather than simply embrace this assumption, I decided to do some quick analysis of spending.  Over the past year or two, I have closely analyzed my spending, and this was the main tenet in my recent financial successes.  However, I have gotten away from this analysis in recent months.

I decided to chart my numbers for the past three months—September, October and November—since September was the month that I had previously analyzed for the post What is Your Number?

Here is that analysis:

Category:	Sept 2018	Oct 2018	Nov 2018
Total Monthly Gross Pay:	100%	100%	100%
Taxes Withheld:	22.59%	17.25%	20.69%
Other Withholdings:	5.05%	5.00%	5.53%
401K Withholdings:	12.00%	11.99%	1.06%
Diverted to Investment Account:	6.75%	6.75%	4.92%
Diverted to Savings Account:	22.52%	22.52%	0%

There are a few obvious items that stand out for the recent month.  First is that my 401K contribution is dramatically down from previous months.  This is due to me maxing out that account for the 2018 year.  In my post I Maxed My 401K, I explained that the goal would be to continue to capture the monthly amount that had previously been diverted to 401K into a savings vehicle.  Sadly, I have not done that thus far.  Additionally, we can see that the 22+% I had been able to divert to savings in previous months has disappeared.  This was due to the credit card payments.

So, this analysis proved the feeling that something was amiss this month.  This led me to attack the credit card statements.  As mentioned above, I assumed holiday shopping would be the obvious culprit.  While there was certainly quite a bit of holiday shopping evident on the credit card statements, the main culprit was FOOD.  There were several entries for grocery stores and even more for restaurants.  Our grocery spending is properly planned and budgeted so these frequent entries were strange to see.  These purchases averaged $30-$40 so these were obviously not weekly grocery trips.  These were convenience purchases.  This is something that my family will need to address and make sure we are more deliberate with our grocery spending.  The largest item on the credit card statement were restaurants.  I lump all eating out into this category so this would include fast food restaurants, date-night sit down restaurants and nights out at a bar in this grouping.  The fast food restaurants are fairly easy to explain.  I have gotten away from the diet I have followed over the past year or so and as such, I have gotten lazy and allowed myself to eat at fast food restaurants.  I have often justified this with the usual “I deserve a treat” type rationale.  This type of thinking has certainly hit my waistline negatively but this analysis has shown me that it has also hit my pocketbook as well.  Perhaps this awakening will give me the push I need to regain the discipline to eat healthier.  I listed the sit down restaurants as “date-night” items because in this case, that is what they were.  There was one entry for a dinner with my whole family and a few for nights out just me and my wife.  These entries were in fact treats and saying I deserve them is not an excuse in this case.  They presented quality time for my family to be together and I will gladly spend that money, even if it means working a little harder to cut back in other areas.  Last and certainly not least, is my casual dining/drinking spending.  This category has skyrocketed in recent months.  This is the area that I will need to focus on the most if I am going to control my spending, not to mention that this also leads to weight gain as well.  I have a regular weekly “guys night” which tends to be somewhat pricey.  But as I mentioned, this is regular so I can budget for this.  I can certainly work to make this a little less pricey but I wouldn’t want to cut it out altogether.  The other, less frequent items are where I really need to buckle down.  My plan for these is to try to plan ahead and use cash when I am in those situations.  This will force that spending to be much more deliberate and obvious.  Even on the occasions when I spend a little more than is comfortable, I will immediately feel the pinch and use that to readjust and alter my focus.  

I think that I will work on publishing a monthly account of my savings as I did here.  If you think this is a worthwhile exercise, feel free to play along and post your savings rate in the comments each month.

We are quickly coming up on that time of year when we turn the calendars over from one year to the next.  For some reason, we usually use this time of year to turn over a new leaf as well.  Last year at this time was a culmination of sorts for me of getting more disciplined.  I had just completed a year where I began to focus on my health and lost almost 50 pounds.  Combine that with my newly found financial discipline and I decided to actually make some real New Years Resolutions.  I decided to put some goals that were realistic and others that I would consider “stretch goals.”  Another thing I decided to do was write these goals down and keep them in a place that I would encounter often.  I decided to put this list on a piece of paper that I kept in the folder where I kept my monthly expense documents.

In the beginning of the year, I was doing a strong job of reviewing all of my finances month to month.  I would categorize and analyze each and every expense.  Keeping my resolution list in the folder where those documents lived seemed like a great way to keep them in the forefront of my mind.  Unfortunately, some of the discipline that I was so proud of seemed to leave me mid-year and I have gotten away from that ruthless monthly analysis.  The downstream impact of this has been that I have not looked at my resolution list in quite some time either.  Today, the list popped into my head and before I dug it out and reviewed it, I decided to do so publicly via this blog since one of the primary reasons for starting this blog was to keep my self accountable to my goals.

Here is my list of Resolutions for 2018:

1. 1. Keep weight under 235 pounds (FAILED)
2. 2. Re-Read “Your Money or Your Life” and “A Simple Path to Wealth” (COMPLETE)
3. 3. Read at least 15 books (later amended to say Read at least 15 books and Listen to at least 15 Audiobooks) (COMPLETE)
4. 4. Increase personal investment account to $50,000 (FAILED)
5. 5. Max out 401K (COMPLETE)
6. 6. Max out Roth IRA (TBD)
7. 7. Max out Wife’s Roth IRA (COMPLETE)
8. 8. Start blogging regularly (COMPLETE)
9. 9. Pay off Auto Loan (COMPLETE)
10. 10. Pay Credit Card balances in full each month (COMPLETE- with exception of one month)

Considering that I haven’t looked at this list in a while and have not paid much attention to it, I was dreading this accounting.  However, I think overall, I did a pretty good job of achieving my goals.

As for the failures, well, I came close.  My weight was kept pretty steady under 230 pounds most of the year.  However, in the summer, we went on a cruise and the temptations were just too great.  Since coming back from the cruise, I have had a rough time finding my motivation and have allowed my weight to creep slight above my goal.  I will be certain to include a weight goal in my resolution list for next year and push myself to get back to my daily routine.  The additional failure listed was my personal investment account.  At the end of the year, my total was approximately $28,000.  My goal included the regular scheduled movement of money which would account for an additional $13,000 and then a bump from there to account for any additional money I would be able to squeeze out of our monthly expenses and divert to this account.  This did not quite work out as my spending has increased somewhat over the second half of the year.  Again, I would blame this on my relaxing of discipline.  Couple that with turbulent markets the past few months and the account currently sits at approximately $38,000.  This is well short of my goal.

In summary, I hit a large percentage of my goals for the year, but I cannot help but be disappointed in the misses.  Especially since I can blame my own behaviors on both failures.  I will use this as motivation to double down in the coming year and ensure that I renew the vigor with which I attack these goals.  Stay tuned for a future post around the new year where I will lay out my Resolutions/goals for the coming year.