Every year I try to hit different financial goals. If you go look at my last post you will see that I didn’t do the best with my financial goals for 2017. I accomplished a couple of them depending on how you measure them, but I would like to do a better job in trying to get our financial house in order. So here are my financial goals for 2018.
First, pay down 10% of my debt. My debt currently stands at $209k. It originally started with $264k and depending on how you calculate it might be more like $286k. I have paid off in 3 years about $77k and that is actually more if you include the personal loan into the mix. The point is that I didn’t hit my goal in 2017 and I need to get back on the debt repayment train. So 10% for me would be about $26500. If I can pay off that amount that would be great. Basically, that would mean paying off the car in 2017. Because I will automatically pay about $13k in principle down on my mortgage based upon my payments. I will only pay off about $2500 in my student loans, which means that most of the rest will come off of the car. In fact, it would be great if I could pay off the car in 2018.
Second, contribute 20% of our income to savings. By this goal I mean actually contribute to our savings plan. In other words, debt repayment is NOT included in those savings. In some respects, this is a little tricky to predict exactly how much we will save. Part of the reason is that Mrs. ROB is a college professor who teaches part-time at multiple campuses. Therefore, each semester we are kind of at the mercy of each campus on what courses they will give her. I also do teach additional classes and extra things at my university to make money. In fact, it is like I have a 2nd job there so I am not sure the exact dollar figure, but in order to hit this goal we will need to definitely increase our retirement savings from where they are.
Third, save 15% of Mrs. ROB’s income for retirement. I blame myself, in part for this, because I handle most of our finances, but we haven’t done a very good job of really revving up Mrs. ROB’s retirement savings. Even though we started an IRA for her we could’ve been putting a lot more money toward retirement for her over the past five years. In fact, I calculated it out and if we had done so she would have (with the growth of the stock market) well over $50k in her retirement accounts if not more. That needs to change so I am going to try to allocate a monthly amount in our budget that we will dedicate to putting in her IRA and possibly other retirement accounts so that we can really get her savings going. Putting more money into Mrs. ROB’s retirement savings will give her more security, diversify our savings, and allow us to keep more money from the government for taxes.
Fourth, don’t go into more credit card debt. For the most part I pay off my credit card balance every month. However, the last couple of months we have carried over some balances on occasions. We had some unexpected expenses with the mold in our bathroom and some additional medical expenses that came up in the 4th quarter of this year. Instead of dipping into our emergency savings (stupid yes I know) I put those items on a credit card and vowed to pay them off. Well, I have almost got them done (should be done this month) but I don’t like that money sitting on my credit card, even though I got cash back with those large purchases. The truth is we use our credit cards TOO much. It is too convenient and because of that probably increases our spending. I would like to start using CASH a lot more to reduce this aspect of spending. I have all of my bills automatically put on the card (except our loans and mortgage) so that will continue, but food, gas, and other things we should start using cash more.
Finally, add more money to our emergency fund. I currently have about 3 months of expenses regarding the 4 walls for an emergency in my account. I would like to kick that up to another month. I think part of that is getting a month ahead on our bills. Because we get paid, for the most part, biweekly, I hope to put some of my paychecks aside so I can have a month ahead fund. So if we do run into other expenses I could just go toward that money and not play monetary mental gymnastics with myself about how I should pay for things.
So those are my goals for 2018. It is a weird mixture of paying down debt and savings. In 2017 I made a conscious effort to focus more on the savings side of things and I think I should continue to do so in 2018. In other words, if I have to choose between paying off debt or putting more money into retirement savings then I think I am going to go with retirement savings. I get a better return on that money in the long run.
What do you think? What are your goals for 2018?
Let me say that all of these goals might be sort of thrown out the window if some of the changes we anticipate might happen in 2017. That will be both good and bad. I hope to write a bit more about that in the next month or so.