The Holiday Season is in full swing. You know what that means? 2014 is quickly coming to an end! As I’m thinking about my plans for the remaining weeks of 2014, I can’t help but start thinking about what 2015 holds.
There is still a lot of uncertainty on whether or not I’ll be able to make my 2014 goals. I think my goal of growing my net worth by $10,000 in 2014 really was a great goal. However, as the year played out, I started to have issues with my mini-goals. In figuring out how I could possibly grow my net worth by $10,000 in one year, I came up with a plan to pay down $5,000 in debt, and grow my 401(k) by $5,000. Why would I have a problem with those goals? Well, about halfway through the year I started to realize that those goals didn’t really require me to do anything. All I needed to do in order to reach those goals was continue making my regular debt payments, and continue contributing to my company’s 401(k) plan. Sticking to the plan is a good thing. But I kind of feel like, at this point in my financial journey, I need goals that will challenge me a bit more. Goals that will push me out of my comfort zone. The whole point of setting goals is to work towards change. My goals didn’t require me to take any action throughout the year, and so, after a while, they started to become a little, dare I say, boring!
It seems a little weird to write that last years goals weren’t challenging enough, and at the same time say that I may not make my goals. Had I stuck to the plan, I would have easily made my goals. But part way into the year, I decided to stop contributing to my company’s 401(k) plan, in favor of paying ahead on debt. And, while I didn’t pay off as much debt as I would have liked, the after-tax amount of my 401(k) contribution almost equals out to the amount I paid ahead on my debt. And, in hindsight, basing half of my growth goal on the value of my 401(k) was a risky plan. I have control over how much I contribute, but I don’t have control over what the market does. Sure, a good year could result in a lot of growth. But what if it had been a bad year?
While I want my goals to be challenging, I also want them to inspire positive changes. Sure, I could live on beans and rice, never go anywhere, and save all kinds of money. But I’d be miserable (Literally; My sensitive tummy would not agree with that kind of diet!). I want goals that encourage me to prioritize and balance my spending, while also emphasizing the earning part of personal finance. I want goals that drive me to reach for better things.
So, with all of that in mind, what goals have I come up with for 2015?
1) Grow my net worth by $10,000. I still think this was a great goal, so I’d really like to keep this one for 2015. What I’m not going to do this year is specify exactly which categories I need to see that growth in. I kind of prefer the idea of having goals that are independent of each other. I found myself feeling a little torn in 2014 when my net worth was growing, but not in the “right way”. Of course, my goals are all financially based, so making any of the other goals will help in making this goal. But I’m also leaving myself room to re-prioritize throughout the year. Who knows what 2015 might hold?
2) List the house. Something has to be done with the house, and the sooner, the better. I’d love to phrase this one as “Sell the house in 2015”. However, I’m a little worried about the housing market. So, I’m saying “list”, with the idea that if we can’t sell the house, we can reconsider renting. I guess I’m leaving some flexibility in this goal as well. The important thing is that something happens, so my house quits being such a financial drain!
3) Pay off my student loan. I have one remaining student loan, which will start 2015 with a balance of less than $4,900. It’s from my undergrad days. I graduated in 2000. It’s way past time for this thing to be gone!
4) Invest $3,000 in a retirement account. Notice the term “invest” here. I’m not saying that when 2015 comes to an end that the account will be valued at $3,000; It could be more or less, depending on how the market plays out. The point is, by the end of the year I will have contributed $3,000 to it. I’m also not specifying what type of account; 401(k), IRA, Roth IRA, or any combination of the 3 is fine. That way I have some flexibility, in case of a job change, or brokerage change, or whatever. The point is, at 36 years old, I need to be investing. $3,000 is a kind of paltry amount. But, hey, it’s a start!
5) Earn $500 in “Side Income”. Right now, I’m not really sure how I’ll earn the extra money. Maybe I’ll find a side hustle? Maybe I’ll sell some things? I don’t know. The point is, I need to start diversifying my income. I’m keeping the amount intentionally low, so I won’t get discouraged. The important thing is to break the ice in 2015!
So, those are my goals for 2015. I’m hoping it’s a good mix of challenging, yet achievable. I want to get myself out of my comfort zone, but I also don’t want to make my goals so difficult that I feel like I can’t reach them. I’m hoping that 2015 will be a year of big changes, but I’m not really sure what those changes will look like yet. Right now I need goals that are specific and measurable, yet aren’t so constrictive that I can’t be flexible with my plans. That way I can embrace whatever changes lay ahead!
What are your goals for 2015? Are there things you would have done differently with your 2014 goals? What do you think of the goals I’ve set for 2015?
– Cindy W.