With the dawn of 2016 upon us, I thought I’d share my financial goals for myself over the next year. In short, my goals are: 56%, $34,000 and 5 books.
This is the percent of my post tax income that I would like to put towards investments in 2016. Just investments. The amount will include maxing out my 401K, IRA and HSA, as well as some additional (variable) investments into a private brokerage account. The first three are automated and I do not think about, but that last one is where I will need divine intervention. If I can get $6500 into that brokerage account by this time next year, I will be thrilled.
This number (56%) does not include all of my savings as it excludes my contributions to my “Oh $h*t Fund”, which is what I lovingly call my emergency savings, and my contributions to my transitional/short term savings, which is where I save for things like clothes, new tires, car maintenance, random expenses, etc. Those collectively will account for ~8% of my income and can be found in the table below. I opted to leave them out of the 56% because they are fleeting. This is money I am explicitly setting aside to spend and, as such, I keep entirely liquid.
When it’s all said and done, I should be able to sock away ~$34,000 this year, which would be wonderful considering that this, in addition to my current net worth, would mean I’m 10% to my retirement fund goal of $750,000.
I read my fair share of FI blogs and fiction books already, but I’d like to move towards reading finance books. I have the following on my list currently:
- The Millionaire Next Door
- Rich Dad, Poor Dad
- Get What’s Yours: The Secrets to Maxing Out Your Social Security
- I Will Teach You to Be Rich
- Early Retirement Extreme
I’d also like to do some research and reading into developing other streams of income. The nature of my job is demanding and restrictive in the ways of non-compete agreements, but I do have some down time that I’d like to commit to other ventures and I’d like to explore what I can do with that time.
April and September* = 3 paycheck months.
I will reassess my plan once more this summer for a few of reasons:
- I hope to get a raise/bonus in June (this is why I split up the 56% and $34K goals into two separate goals, as those numbers may change mid-year)
- I hope to have my ‘Oh $h*t Fund’ goal met by May freeing up $200 a month to drop into investments
- I hope to get moved onto another project at work that would not require a car, which would then allow me to sell my car, freeing up another ~$450 a month
That’s quite the rosy picture, ain’t it? the truth is I’m terrible with goals and foresee myself messing up somewhere. But all in all, I’m feeling quite happy with the picture I’m seeing. The goals are difficult, but not insurmountable, and part of this process is teaching myself to stick to goals and tame impulses. I just have to keep reminding myself that any effort I make is better than nothing.