Typically, I have a few days at the end of the year to get my next years goals together, and this year, I got a bit of our late start because we were visting relatives in Western New York. That took a while to get caught up from, and because I got married last year, I also had to see what H thought that we should do with our finances. While she has good ideas, she does have a bit of an aversion to writing them down on paper. It took me a while to convince her that we should write them down on paper instead of just both of us having the goals in our heads (that were remarkably similar, mind you) and nothing written down. Its kind of like driving where you know there’s a road but you cant really see it – you can detour easily.
Last year was just so-so in terms of financial goals, and this go-round im excited to have an accountability partner with me to help keep me on track. As I’ve been realizing, my finances havent really gotten that much better over the past 2 years. Thankfully, they didnt get worse either. Due to the way things shook out last year, this year I’ve included specific steps to get to our defined goals. Something that we will need to do every week/month/quarter to make sure that we are on track and not scrambling at the end of the year to get over the hurdle.
- Our first goal is to create an emergency fund. You may think that we are crazy for not having one already, but we had a bunch of savings for other things that we could have used had there been an emergency. We hope to get this up to 2 months living expenses by the end of the year. To do this, we are going to set up a new savings account (possibly with a different bank from our current savings bank, ING Direct) and contribute to it monthly. Unfortunately, I havent determined the amount that we need per month quite yet – there’s a lot of noise in the data because of the constat trips to lowes for house stuff.
- Our second goal is to pay off the truck. I had hoped to have this done by the end of 2012, but there was just too much other stuff going on with the house to get this done. The end of the year will mark year 3 of the loan, which is still pretty good, but lots of it was because of the hail damage sustained last summer. Once this is paid off, we can also lower the insurance on it, as I no longer need to be covered for things like hail storms, as my truck cant possibly get any worse. To accomplish this goal, we are going to be making double truck payments every month until the note is paid off.
- Our third goal is to increase deposits to our various savings accounts by $250 overall per month. We have a few different accounts for house stuff, appliances and vacations, and each account is currently getting a certain amount of money per month. This year, we are planning on increasing the amount of each of these accounts, to total $250 a month between each of them. To do this, we will simply change our automatic deposit amounts on our savings accounts, and let the goal-o-matic machine work its magic.
- Our forth goal is to have more than $1,000 of cash left over at the end of every month. Right now, our numbers show that we are spending between 35-45% of what we earn on basics (food, mortgage, utilities, etc) and leaving the rest as free cash flow. For much of 2012, that spare cash flow was soaked up by house repairs (and still is, to some extent). We have wound down many of the house projects with the exception of the bathroom, so we are hoping to free up quite a bit of cash as we head into Q1 & Q2 of 2013. The projects will probably start again to some degree in the summer, but hopefully wont be anything like they were last summer. To do this, we are going to watch our spending and make sure we hit a certain number of no spend days per week.
Those are our goals for the year 2013. What do you think? What goals have you created for the new year, and how do you plan on sticking to them this year?