Goals are cool guys. It’s like, they help you aim towards something and stuff. I’ve been setting goals since 2017 and have found them a useful guidepost. They’re a good motivator too especially when I do quarterly reviews and see that I’m behind. Initially I started with some personal goals but I’ve split those apart and am only focusing on 2019 financial goals here.
I generally try to set these at the tail end of the year so I’m a bit late in 2019. However, I figured waiting till I reviewed my 2018 goals was a good idea so I could have a good barometer for setting next year’s goals. I did the review a few weeks ago so now it’s time to set my 2019 financial goals!
Related : The 2018 Annual Goal Review
If you’re a new visitor then the main thing to know is that my goals are based on a medal system. I set the bronze goal at a reasonable level then the goals get harder for silver and gold. We got some Olympics type stuff going on here! If I set these goals correctly, I’ll mostly achieve bronze medals with only a few silver and gold. Gold is meant to be pretty damn hard to get.
At the end of the year, I can feel good about all the medals I get and reward myself with nothing!
- Bronze – Invest more new capital than in 2018
- Silver – Invest 15% more new capital than in 2018
- Gold – Invest 30% more new capital than in 2018
I invested just north of 31k last year which was good enough for bronze. I’m ditching dollar amount goals this year and instead am focusing on improving the amount invested.
I’m relatively sure I can hit bronze since I’m losing my wedding expenses this year. However, silver and gold may be tough since I’ll likely have other expenses. I already have a root canal scheduled for next week and a crown after probably which will cost a pretty penny!
- Bronze – Collect $12,750 in dividends
- Silver – Collect $13,750 in dividends
- Gold – Collect $14,750 in dividends
I hit gold rather easily here last year so I’m making the medals much tougher this year. I finished with $10.7k in dividends in 2018 with a 28.6% growth rate.
The bronze medal here represents a 19.1% growth rate. I think my growth rate this year will be much lower. For one, I won’t benefit as much from rising rates for my money market and bond accounts. Another reason will be that I don’t expect as much in terms of dividend increases as the tax reduction impact is largely baked into dividends now.
Silver represents a 28.5% growth rate so in line with last year. Gold represents a 37.8% growth rate and would require a ton of new capital and dividend bumps.
Savings Rate Goals
- Bronze – Gross income savings rate of 33%+
- Silver – Gross income savings rate of 36%+
- Gold – Gross income savings rate of 40.5%+
I finished last year with a 30.3% gross income savings rate. It might seem weird that I’m bumping my bronze rate well above that but there’s a few reasons for that.
One is that I got married in 2018 and went on a honeymoon. The wedding expenses shifted this rate by 10% on their own meaning I would have finished above 40% if we didn’t spend a decent amount on our wedding. Now, we saved in other areas expecting that but I still think my gross savings rate will automatically improve simply because I won’t be getting married again!
Another is that my income went up towards the latter part of 2018 due to a new job. That means 2019 will be the first full year with the higher income which will lead to a higher natural savings rate. I also paid off my car loan in 2018 so car expenses should be down.
I don’t want to bump this too much since I know stuff will come up(root canal!) but I think I can get a higher rate than last year and the goals reflect that. Note that 2019 might be the year we buy a house so that might throw all these assumptions into disarray.
- Bronze – Savings rate of 43%
- Silver – Savings rate of 48%
- Gold – Savings rate of 53%
I finished last year with a 39.8% savings rate. This savings rate moves in line with the gross income savings rate. The reasons are the same.
For those wondering what the difference is between the two. The gross income savings rate is a pure savings/gross income calculation and includes taxes. This savings rate is a pure savings/(savings+expenses) calculation and excludes the impact of taxes.
I like to track both since tax liability in retirement is difficult to estimate. Since my expenses are low, it’s likely my tax liability in retirement will be much lower than it is now so the savings rate may be more relevant.
- Bronze – Savings rate of 50%+ in 6 months
- Silver – Savings rate of 50%+ in 8 months
- Gold – Savings rate of 50%+ in 12 months
I hit 50%+ in 6 months last year. A lot of that was months where we purposely cut back our spending due to upcoming wedding expenses. However, I think I can continue that and even improve upon it in 2019.
I didn’t find that we were struggling with boredom in those 50%+ savings rate months. We’re lucky to be happy with things that are free or cheap. Our biggest costs are fancy meals as most of our other activities are free like hiking. It also helps that we’re in the northeast and the winter months are for hibernation.
There’s also months where 50%+ is not too much of a struggle like ones where I get my bonus or get paid three times instead of the usual two. That usually means at least 2 or 3 months are guaranteed 50%+ due to my low natural spending. The others I’ll have to work for a little bit.
- Bronze – Reduce one bill in 2019
- Silver – Reduce two bills in 2019
- Gold – Reduce three bills in 2019
This is a simple goal that I didn’t pursue well in 2018. Often times, you can call service providers and negotiate a lower price.
For example, in 2017, I called Comcast and was able to reduce my monthly internet costs by $20. They’ve since crept my price up again so I have to make the call again in 2019.
Another example is finding new ways to pay for things. I am an Apple Music subscriber and found out that an annual prescription exists that can save me $20 per year($99 per year instead of $9.99 per month). On top of that, I can buy a $100 Apple gift card for $84 during Christmas at Costco saving me more money!
- Bronze – Reduce utility costs
- Silver – Reduce utility costs by 10%
- Gold – Reduce utility costs by 20%
I’m the type of person to set my heat or cooling to 72 and forget it. I like it warm even at night.
However, lately I’ve been finding more comfort in lowering the temperature a bit and putting on a robe. That’s especially true at night. We recently picked up a merino wool blanket that has helped with warmth at night as well reducing the need for high temperatures over night.
For this category, I’ll consider electricity and gas to be utility costs. Water is included in my rent.
- Bronze – Increase income(2019 vs. 2018) by 7%
- Silver – Increase income by 10%
- Gold – Increase income by 13%
I received a raise around September that boosted my forward income by a bit more than 10%. That means I was able to grow my income 7.6% last year.
This will be the first full year with that raise and a potential for a bigger bonus. That means my goals are going up a bit. These are driven by the fact that my 2019 income should go up against 2018 simply because I have a full year of my new salary. These are not forward income goals.
- Bronze – Make a profit on the blog and donate it to a charity
- Silver – Make $100 on the blog and donate it to a charity
- Gold – Make $200 on the blog and donate it to a charity
This is a fun goal as the blog currently makes no money! The goal of this blog is not to be a profit driver for me but I clearly won’t be against it. The reality is that the blog is for accountability and written as a creative outlet. I’d also naturally like to increase my income and increase my charitable giving as a result. That’s why the mission statement of this blog is to donate at least 50% of the profits(likely 100%) to charity.
Right now, the blog is not profitable as costs outweigh any income coming in for the blog. It’s unlikely that it will become profitable in the new year but we’ll see! I do plan to be more active this year and who knows what will happen.
My main income is via ads and affiliate links. My main expenses are hosting fees and some products I use to make the blog better. The expenses aren’t high but the income is much lower right now!
I had nine goals for 2018 and continue that trend with nine 2019 financial goals.
2018 was an expensive year so it stands to reason that 2019 goals would raise the bar for each medal by a good amount.
It’ll be interesting to see what happens in 2019. There’s potential for a home purchase which would throw a big wrench into the proceedings. However, if that doesn’t happen then my results should improve over last year unless something bad crops up.
I already have a root canal scheduled for next week. That’s bad for my financials but worse for my anxiety!
I do enjoy the process of setting and tracking these goals and think they’re a good way to keep myself accountable.
The best part is that most of the goals(outside of income goals) are things I can probably control. I can adjust my spending if I see I’m falling short and that’s cool because often so many things in life are outside our control. Of course, there are things that can crop up that can affect my ability to meet these goals but hopefully those things are rare any given year.
These goals aren’t vague but clear targets that I can judge my progress on quarterly. I’ve also added a nice little blog goal this year. I can’t control that one but if I succeed, I can start donating money to charity which is in the mission statement of this blog!
Overall, 2018 was a fantastic year on a personal level. It didn’t end up being too bad on a financial level either as I did pretty well on my goals.
I doubt 2019 can match it on a personal level. After all, you only get married and go on a honeymoon once but I’m definitely aiming higher on my financial goals this year and I plan to be successful on that front.
Seeing the great results since I started goals in 2017 has motivated me to do better each year and these 2019 goals are a reflection of that. Golds will be HARD this year but hopefully I can hit a few.
Hopefully you had a good year in 2018 and my goals can motivate you to try for something more in 2019. Thanks for reading and here’s to a great new year!