Welp, the first quarter of 2023 is now in the books, and it’s time for the (first) day of reckoning this year — how did we do on our financial goals during these first three months?
I will say this — while we haven’t made the progress we would have hoped for yet this year (largely because we’re still waiting on a long-anticipated raise for my husband from his work), we’ve still made good progress on our main goal for the year thanks to a decent tax return.
As for the rest of the goals (and the rest of the year’s progress or lack thereof), it will basically all come down to two things: 1) hopefully getting that raise at last, and 2) seeing how we do our third year of flower farming. Beyond those two things, we have meticulously planned and budgeted and tried to figure out the entire year to the best of our ability in order to avoid taking on further debt, so most progress on the goals below will have to come from an increase in income at this point.
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. More recently, I’ve started using Empower (formerly 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 Empower account, we can both earn a $20 Amazon credit 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 Spreadsheets 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. I’ve also done posts about our monthly and yearly budgeting strategies in this new series.
2023 Financial Goals
Pay Off Credit Card Debt
By far our biggest goal and #1 priority this year is to pay off our credit card debt before it starts accruing interest in August. We purposely signed up for this particular cash back credit card because 1) it had a decent cash back rewards program on any and all purchases, especially in the introductory period, and 2) it gave us 18 months at 0% interest to pay off new energy efficient windows for our house, which is the whole reason we got the card in the first place.
We basically have four months to get this number as close to zero as we can so that we won’t owe a cent towards interest, but as I said, whether or not that happens will depend almost entirely on getting an increase in income this year.
Almost all progress made on this goal this quarter was from our tax return, with just a small amount coming from paying the minimum payments.
- Starting Amount of Debt: $8,692
- Current Amount of Debt After Q1: $4,750
- Amount Paid Off in Q1: $3,942
- Percentage of Debt Paid Off Thus Far: 45.35%
Build Emergency Fund Back to $5,000
Not much to report here. It makes me a bit nervous to have such a “baby” emergency fund (definitely much less than the 3-6 months of expenses that’s recommended), but it’s at least enough that we’re holding off on it a bit until the credit card is paid.
- Goal Amount: $5,000
- Starting Amount Saved: $2,175
- Current Amount Saved After Q1: $2,280
- Amount Added in Q1: $105
- Percentage of Goal Reached: 45.6%
Pay off Hospital Bills after Baby’s Birth
Considering that we’re expecting the baby next month and the hospital bill to come a couple months after that, it’s crunch time for this. We’ve decided to temporarily pause all retirement contributions for the next several months in order to get the money we need to cash flow this.
- Goal Amount: $2,200
- Starting Amount Saved: $0
- Current Amount Saved After Q1: $0
Buy a Quarter Cow in Cash
We would need this money by the fall, but as our focus is on other goals at the moment, there’s nothing to report here. What I’m kinda hoping will happen is that we’ll make enough from flower farming around the same time as an opportunity like this would come up that I can just cash flow the money from that.
- Goal Amount: $400-500
- Starting Amount Saved: $0
- Current Amount Saved After Q1: $0
Have at Least $300 in Each Sinking Fund
Dealing with two bigger house costs already this year (some plumbing issues and a new dishwasher) has only stressed the importance to me of actually building up the sinking funds we’ve already created bank accounts for. In the past, I’ve been wishy-washy about building these up unless I know of a specific expense coming up soon (such as a specific vacation or known car repair), but I now see I just need to buckle down and be regularly saving money in all the categories, regardless of whether or not something specific is coming on the horizon.
True, it makes the most sense to build up the categories that we know for sure we’ll be needing first (and I’ll keep doing that), but I need to not neglect the other categories in the meantime.
Our current sinking fund categories are: Car, House Maintenance/Projects, Travel, and Medical (which was covered above, but which I’ll count separately again down here because I’ll want to also have at least $300 in the fund AFTER we’ve paid off all the hospital bills from the baby).
Even though we don’t currently show any funds in any of the categories, we actually HAVE had money in some of them already this year, but they were put there to cover very specific things (such as money in the travel fund for the trip we took to St. George in January) and have already been used for those purposes. So I guess the real goal is to have $300 in each of these categories that ISN’T earmarked specifically for anything in particular — that we just have in there in case something unexpected comes up.
- Goal Amount in Each: $300
- Current Car: $0
- Current House Maintenance: $0
- Current Travel: $0
- Current Medical (beyond expected hospital bills): $0
Contribute Any Amount to My Roth
Now that we’ve had to pause ANY retirement contributions until some of the goals above are taken care of, this is looking less and less likely to happen this year. However, if we’re able to knock out most of the other goals this year (or even just the first three goals, which are our top priorities), we’ll be in a great position in 2024 to hit the ground running with retirement contributions again.
- Current Amount Contributed to Torrie’s Roth in 2023: $0
While it still feels like we have such a long way to go this year (and we do), I will say this — being in an unexpectedly tight financial situation at the moment has only served as a powerful reminder to both my husband and me that we need to be smarter about how we handle money in the more flush times so that we don’t put ourselves back into this position when times are more lean.
Looking back (using good ol’ 20/20 hindsight), I can see now that we would have been better off stashing away more in our emergency and sinking funds rather than using the stimulus checks and child tax credits of old to mostly go towards paying off our mortgage early and opening up (and adding to) a brokerage account. Those were still reasonably smart money moves to make, but they weren’t the BEST money moves for us to make at that time. I’m at least glad we chose to do something like that rather than just blow all the money on stuff we didn’t need, but we should have been more prudent about building up easily accessible savings rather than expecting that the financial situation we were experiencing in 2021 would continue long-term.
I know things will work out though, and the past several months have been a good chance for me to build up my frugality muscles, make do without, budget more wisely, and be grateful that even though things have been tight, we still have always had enough to cover all the bills and have money for what we truly need. We’ve also been able to see God’s hand multiple times in the details of our lives the past few months, as *just* the exact amount of money we were short has come to us at *just* the right time–literally down to the dollar–on quite a few occasions.
And so we press on. Quarter Two, let’s see how you shake out!
How are your financial goals going lately? Has 2023 brought any surprises your way yet?