Thursday, December 23, 2010

Financial Goals for 2011

In my most recent post, I shared that I'd been organizing my finances (reconciling savings plans, debt reduction plans and budgets). Naturally, the next thing for me to do was to think about what my goals are for the upcoming year and what I need to do to make sure these goals are achieved. Below, you will find my goals and the steps I intend to take to make them a reality:
  • Zero credit card balance: My goal is to end every credit card billing cycle without a balance. This is one way to ensure that I don't spend above my income. I can make regular purchases, such as gasoline and groceries, with my credit card. In fact, I've been considering a rewards card to earn points for ___________ (<<that means I don't know, yet >). This year, I paid $68.21 in interest charges.  That's enough money for gas (and then some), a nice dinner with my boyfriend, an outfit, or a small contribution to my savings plan (after all, it all adds up!).
  • Max out my Roth IRA: You already know that I've been kind of obsessed about paying off my car note. As such, I don't have much money left over to max out my IRA. With a projected payoff date of April 28, 2011, I have May 2011 through April 15, 2012 to contribute $5,000 to my individual retirement account. What do I have to do to make this happen? Contribute $454.55 each month to the account. With two "extra" paychecks in 2011, I may have the flexibility to reduce the monthly amount, but this requires that I'm diligent about redirecting a sufficient amount of those checks to the IRA. Knowing me, I'd like to set a few bucks aside for fun =)
  • Pay off my car note: Originally, I planned to pay off my car note by June 2012, that is, until I ran the numbers on my beau's proposition of significantly increasing the principal payment amount. Currently, I am on track to achieve this goal by the end of April 2011, especially if my assumptions about my anticipated tax refund are correct. If they are less than I estimate, I may have to postpone the due date for this goal (which, undoubtedly will effect the savings goals). Let's keep our fingers crossed and hope I am at least right :)
  • Generate at least $250/ month in extra revenue: Before I took the job that I currently hold, I had a steady goal of generating $3,000 in net income each month. With my deductions for my defined contribution plan, I am short of this goal by $222 each month. For the past few years, I've been toying around with a business idea that promotes personal finance. My goal for next year is to get serious about a web design and marketing plan so I can realize some income. $250/month of income to be exact. To be clear, I'm not looking to pocket all income; undoubtedly, I will reinvest into the business, but having the income will definitely provide some peace of mind.
  • Accumlate $10,000 in non-retirement savings accounts by 05/31/2012: These funds would be available for immediate access and as part of my emergency savings. Why $10,000? Frankly, it's an arbitrary amount, but it's definitely a "stretch goal." There are a number of factors at play. Let's start with the not so good possibilities: what if I don't pay off my car by the end of April? What if I don't generate enough additional income? Well, my $10K goal within 12 months will be postponed (by the way, I'd redirect my "car payment" money to this goal). For me to achieve this goal, I need to set aside $833.34/month.  
If you recall, I have $1255 available as discretionary money each month. I'm comfortable spending $200 of this amount for fun stuff. So $1055 - $454.55 (Roth)-$833.34($10K goal)= $-232.89. A girl MUST increase her income to make these goals come true. Even if I sacrificed fun stuff every month (i.e. the previously mentioned $200/month), I'd still be a few bucks short! 

At any rate, these are my financial goals for 2011. What are your financial goals for 2011, if any? How do you intend to achieve them?

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