Happy new year, everyone! We made it to 2021!!! Because I’m in the middle of working on my new 101 in 1001 list, I’m not setting any traditional New Year’s resolutions this year, but in honor of the beauty of a brand-new year and fresh start, I figured I’d bring some goal inspo to you today!
In 2019, I started a new series based around our big financial goals, which included buying and paying off our minivan in full in under a year, saving $10,000 in our emergency fund, and more. I loved the focus and the accountability that those quarterly reports gave me (and it sounds like many of you loved them, too!), so I have decided to continue the series, except this time with 7 new goals.
These goals are taken almost exactly from my latest 101 in 1001 list, but having to report regularly on our progress will make sure that they continue to stay top of mind.
While we have overall good financial habits in place that keep us from veering too far off course from our general life goals with money, I have found that for me, I really need challenging goals to keep me excited and looking for ways to stretch our money as far as it can go. I purposely set the goals below to be more on the “stretch” side, and I’m excited to see how many we’ll be able to accomplish before my 101 in 1001 deadline of July 2022!
Below I’ve included the (true) initial figures and amounts from the beginning of the challenge, which started in October of 2020, as well as the current values of the accounts (if they are different). I debated just waiting to show you any progress until the first quarterly report in March, but this way I’ll be even more motivated to make sure we stay focused so I’ll have some (more) good numbers to report to you then!
Note on How We Track Our Financial Progress
For basic budgeting and household account maintenance, I use Mint, which I’ve used and loved for years. Recently, I’ve started using Personal Capital as well, which has many of the same features as Mint, but I like using it instead of Mint for tracking our debt reduction and investments, as I find their tools are a bit better for that. Both are free. (And if you sign up for a free Personal Capital account, we can both earn $20 if you go through my referral link!)
For a clearer snapshot of our financial picture over time, I started tracking our net worth via Google Spreadsheet in August 2018. It’s been a total game changer, and I highly recommend you read the post I did on the why and how of that process here.
On to the goals!
Our 7 Big Financial Goals
Open up a brokerage account + invest $2,500
While both Matt and I have traditional retirement accounts, we have been fascinated by the idea of being able to have Matt retire from the traditional workforce (if he chooses) before the typical retirement age. In order to do this, we’ll need to have the normal retirement funds in place to cover all our expected life expenses from about age 60 on, and any years we want to have Matt retire before that will need to be funded through other means. While there are a few different ways to accomplish this (including real estate, which we might eventually get more into), we’ve decided to go with opening a brokerage account soon while we have time on our side.
Our plan was to open up a brokerage account through Fidelity, specifically one of their Total Market Index Funds (FSKAX). Most other brokerages require a minimum investment amount (usually from $1K-$5K) to start, but this particular fund doesn’t have a minimum requirement. To make this goal measurable, however, we’re shooting to open up an account with $500 and then have invested at least $2,500 by the end of the challenge.
As of now, we have opened up the account with Fidelity and invested our first $500.
- Goal Amount: $2,500
- Current Amount Put Toward Goal: $500
- Percent of Goal Reached: 20%
Buy and pay off a new vehicle to replace the Buick
About six years ago, we purchased my grandma’s old ’96 Buick from her estate after she passed away, and it’s the car my husband has been driving to and from work ever since. While the mileage on it is relatively low for its age, it’s had some transmission issues from the beginning, and as time goes on, the “quirks” and problems just keep coming.
While we plan to keep on driving it until it basically is unsafe or doesn’t function anymore, we anticipate that that could be sooner rather than later. Therefore, we’ve set up a sinking fund to put aside money to buy a reliable, more gas efficient car for Matt to use for work (and for me to use when I’m making a trip sans kids, as we’ll be looking for a model that gets better mileage than our minivan).
While we need to narrow down our options on which vehicle we want to ultimately purchase, we know that we’ll be buying a used vehicle and that we’re going to be looking for something that will last us a good long while, which means we will likely have to finance some of the purchase, especially if the Buick gives out sooner rather than later. If we do end up having to take on a car loan, the plan is to have the whole thing paid off ASAP, just like we did with our minivan (which we were able to pay off in under a year).
- Initial Amount Saved: $500
- Goal Amount: we’ll probably go for something in the $8K-$10K range
- Current Amount Saved: $700
Get each kids’ savings account to $500
We don’t plan to save up a ton for our kids’ future college expenses (because scholarships, grants, and working during school worked just fine for us), but we do want to have some funds set aside for their futures, especially if any of them end up choosing to serve a mission for our church. Missionaries from our church, The Church of Jesus Christ of Latter-Day Saints, fund their own mission expenses, and both Matt and I are so grateful for the help we received from our parents when both of us decided to serve missions when we were 19 (Matt) and 22 (me).
Should any of our children choose to serve, we want to be able to help them with those expenses. If they don’t want to serve a mission, we will use the money saved to go towards their higher education expenses.
The goal is to get each of these funds to at least $500 by the end of the challenge, at which point I hope we’re in a place to be able to continue contributing $25 a month or more to each fund. As they start nearing the end of high school, we’ll likely greatly increase contributions, but we at least want to get a head start now as much as we can.
- Initial Amount (Kid #1): $172
- Current Amount: $222
- Percentage of Goal Reached: 44.4%
- Initial Amount (Kid #2): $153
- Current Amount: $203
- Percentage of Goal Reached: 40.6%
- Initial Amount (Kid #3): $114
- Current Amount: $204 (we just put a bunch of his birthday money from grandparents in there, which is why his is currently beating out his brother’s!)
- Percentage of Goal Reached: 40.8%
Make an extra mortgage payment (not necessarily all at once)
Because I’m so debt averse, I’m SUPER tempted to start trying to pay off our mortgage as quickly as possible. However, since it financially makes a ton more sense to focus on fleshing out our retirement funds at this stage in the game, I’m forcing myself to hold back.
Each month, we pay a little extra to the mortgage, and with each raise, we’ll gradually increase the amount each month. A typical mortgage payment for us is $1,415 a month (which technically includes our Escrow amount as well), so the goal is to have paid at least that much extra on the principal by the end of the challenge.
- Initial Extra Amount Paid: $0 (we hadn’t even closed on our house at the beginning of the challenge!)
- Current Extra Amount Paid: $134
- Percentage of Goal Reached: 9.5%
Start contributing to my IRA again
After I graduated from college, I worked for four years as a full-time middle school teacher. During all four years, I contributed 10% of my pay to retirement to get the full 10% match from the state. However, after quitting my teaching job in 2016, I haven’t contributed anything further to my own retirement accounts. A couple years ago, both Matt and I rolled over our old retirement accounts from previous employers to new accounts through a new financial advisor, which means I’m all set up to easily start contributions again…we just have to make room in the budget and do it.
I haven’t set up a specific amount on this yet, but we’ll likely be starting very small at first—just $50-100 a month. The key is to just start contributing SOMETHING again, no matter how little.
- Initial Monthly Amount: $0
- Current Monthly Amount: $0 (no progress made)
Max out Matt’s Roth one year
Although Matt had been contributing a decent amount to his employer-offered 401k before we got married (at one of his former jobs), his current employer does not offer any retirement benefits, and we were not in a position for a long time to even contribute.
However, a couple years ago we converted his old 401k to a Roth IRA (even though it made us lose quite a bit of money upfront) and started contributing to it again, even though it wasn’t much. We’re currently contributing just $150 a month to this, but we have plans to increase it soon.
By the end of this challenge, we want to have at least one full year of having invested the full annual amount allowed into this ($6,000, or $500 per month).
- Initial Monthly Amount: $150 ($1,800 a year)
- Current Monthly Amount: $150 (no progress made)
Save up $2,000 for home improvements
While we’ve already made quite a few improvements already to our new home (to the tune of about $5,000 so far…WOWZERS), we haven’t touched our upstairs bathroom (which could use quite a bit of work), and we would really like to add a bathroom to our basement at some point if at all possible, since it’s where the kids sleep and since it’s super inconvenient to not have a bathroom close by.
Since we’ve been tackling so much of the work on our home ourselves (or with the help of friends and family), we’ve saved a TON of money on the updates we’ve done so far. We plan to continue DIYing as much of the bathroom projects as possible, so we think that $2,000 could go pretty far.
We don’t quite know yet which bathroom will be the priority at this point (renovating the existing one or adding a new one), but it will be good to have the funds in place either way.
In the past, I’ve usually funded many of our house projects through the proceeds I get from selling things we no longer want or need on Facebook Marketplace or our local classifieds, which I plan on continuing.
- Initial Amount: $20
- Current Amount: $20 (no change)
Do you have any big financial goals for 2021?