One thing I’ve learned the hard way is the importance of setting financial goals. They say ‘the unaimed arrow never misses‘ and I’ve definitely found that to be true. During the times in my life when I’ve not had a goal, I’ve not made any measurable progress.
I suspect many of you have had similar periods in your life where you fell into a rut and were just going through the motions.
That’s a terribly unfulfilling way to live, so these days I’m constantly striving to reach different goals. This year is no different. I’ve set four main financial goals for 2018 they’re going to be tough to achieve, but that’s sort of the point.
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My 2018 Financial Goals
I’m striving to reach FIRE: Financial Independence and Retired Early. On it’s own FIRE is just a dream; to make that dream a reality requires a strategy, and mine is going to take about 10 years to materialize.
To keep me on track I’m using a workback schedule which is nothing more than a very detailed to-do list that begins with a goal and works backwards to where you are currently at, identifying everything that needs to be done along the way.
Each of my 2018 financial goals are nothing more than a financial stepping stone that I need to hit in order to reach FIRE. It’s all like a big puzzle that I’m putting together. In no particular order, here are my money goals for 2018.
TAKE ADVANTAGE OF TAX ADVANTAGES
- Goal: Max out my 401K and Roth IRA accounts.
- Plan: Figure out how much I need to save from each paycheck, then adjust my contributions to make it happen.
Maxing out these tax advantaged accounts won’t do much to help me in 2018. In fact, it’s going to make hitting my other 2018 goals much harder since I’ve only got so much money to work with. But because this goal is just a stepping stone in a larger overall plan, it’s critical that I reach it to stay on track to reach FIRE in 10 years or less.
20th WEDDING ANNIVERSARY
- Goal: Pay cash for all anniversary expenses.
- Plan: Save a portion from each paycheck, increasing that amount if/when I get a raise at work. Reduce expenses if necessary, applying that money to the anniversary fund.
Later this year I’ll be celebrating my TWENTIETH wedding anniversary. That’s a pretty big deal if I do say so myself and my celebration plans are going to be expensive. It would be so easy to throw everything onto my credit card and then pay that off over time, but taking on debt is NOT part of my plan to Get Rich Quick’ish. I refuse to go into debt so paying cash for all of this is going to require some careful planning.
Our anniversary isn’t until late November, so we’ve got most of the year to save, shop around for deals, and maybe even do some travel hacking.
PAY OFF CAR LOAN
- Goal: Eliminate my car loan.
- Plan: Pay of a large chunk of the loan using my annual corporate bonus. Finish the loan off by increasing the amount necessary to pay this off by end of year.
I owe more on my 2017 SUV than I’m comfortable with and I want to completely wipe out that debt this year. Making just the minimum payment would take over three years to do – that’s out of the question.
Eliminating this debt has the additional benefit of freeing several hundred dollars per month which can be used to max out my retirement accounts and save for my anniversary.
GENERATE A SIDE HUSTLE INCOME
- Goal: Generate $1,000 per month from my side hustles
- Plan: Increase blog traffic monthly by writing consistently, improving SEO and focusing on Pinterest. Around mid-year take an affiliate marketing course to learn how to convert traffic into income.
By the end of 2018 I want to be generating $1,000 per month in side hustle income. Any money earned from side hustles this year will be used to reach my other three goals.
Currently I’ve got two side hustles, one that you know about (this blog) plus one other (not blog related). Neither are big money makers right now, but it’s feasible to reach $1,000 per month by the end of the year with a little hard work.
On their own, each of these goals are fine but when you pull back and look at the bigger picture you see that they are simply stepping stones and mile markers on my journey to reach a much larger goal. Each one is critical for me to stay on track and reach my ultimate goal of achieving FIRE.
Having that extra layer of importance makes it far more likely that I’ll do everything I can to hit this goals.
Do you have smaller goals that ladder up to a larger goal? Are you still on track to hit your 2018 resolutions? If you haven’t set any goals, yet, it’s NEVER too late to do so. Why not take some time to work on your goals so that you can make financial progress in 2018.