Usually this time of year I start looking over our finances for the year, project our income a year ahead and start setting some goals for the year. I don’t do New Year’s Resolutions because I am not great at following through with them but I am good at setting some goals for our finances for the next year and achieving a reasonable number of them. This year however everything is up in the air. I am attempting to go back to work in the next couple of months and I am not sure of what my final salary will be. Since I am a pretty precise planner and a little suspicious of counting on future income that may not exist I am hesitant to put numbers down for some of the goals I have in mind. My job search has been pretty wide and I have time so I am making sure that I find something I will love and is a good fit.
That being said, everyone should review their “numbers” at the end of the year and formulate a rough outline of where you want your finances to head in the next year.
I can’t emphasis this enough. One of the best things I did for our finances was to start looking ahead towards the end of the year (and beyond) and plan out roughly where our money would go for the year. Originally most of our goals were about paying down our debt but now that most of that has been paid off and we have moved into a bigger house needing constant work I focus on planning out our house/garden projects, how much we will put into savings and how we are going to pay off our remaining debt.
Last year when I sat down and looked things over our goals consisted of paying off our car (check), paying off our credit cards (check, sort of), and putting a bunch of money into savings (not so great). We also planned on several smaller house projects and the gigantic one of putting up a fence so that dogs and kids could roam free.
Our gigantic fence project was completely derailed by the cutting down of more trees that were extra expensive and by the water pipe that burst in our front yard in the early fall. We did however redo our pantry, replace our entire chimney cap, update the main bathroom, paint some walls/windowsills that badly needed it, replace light fixtures for ones that use less energy, buy a fridge for the garage, purchase garden supplies to grow our own food and paint our son’s closet. Whew. It looks like a lot when I write that all out! Most of our projects were very small and done on the cheap over a weekend or two. We had two of the 5 trees taken down that needed to be removed for safety. We chose the two worst ones and I am really glad we took care of it. One of them was very close to falling and would have hit our house directly in the center causing a large amount of damage. The three remaining trees are so close together that they have to be taken out all at once since their branches are intertwined.
Our expenses for next year will change dramatically when I get a job and with school costs for all three kids (independent of the job). I am still not quite sure what the final numbers will be. Needless to say, I am a little more hesitant to set firm goals this year with so many changes looming.
I am a firm believer in setting some goals you know you can achieve by following your plan, some goals that are just enough out of reach that you have to consciously work at them and some goals that are a challenge and require regular sacrifice and ingenuity to achieve.
For next year our tentative goals are:
1. Pay off the remaining balance on our student loan.
This goal is one of our easy ones, as long as we stick to the plan! I set up our payments at the beginning of 2017 so that our student loan will be paid off by December of 2018 so as long as we continue our automatic payments we should achieve this one! My stretch goal is to pay off our student loan by the end of April with our tax return but it isn’t set in stone yet.
2. Pay off our credit cards.
We met our goal of paying off our credit cards and keeping them paid every month for most of 2017 but we ended up choosing to put the water pipe on our credit card since it came up unexpectedly and we had already used our yearly home improvement funds for other projects. Yes, we could have used our emergency fund for it but with so many uncertainties coming up at the start of the year we decided to take on the debt. We should meet this goal for sure by mid-year or sooner if we apply ourselves and put all of my excess salary towards it.
3. Bulk up our emergency fund.
Sadly our emergency fund is a little lighter than we would like at the end 2017. We had a lot of large expenses and focused on paying down debt versus saving so we did not put as much in there as I would have liked. Our goal is to save up at least one more month’s worth of money in our general emergency fund next year. Ideally we would save up two months worth but with everything else that would be our stretch goal for sure!
4. Invest as much as possible!
Yes, this is a very vague goal! There are so many what ifs that I have no idea how much we will be able to put into our newly opened Vanguard account. I have it set up to put a small amount in there every month but I am hoping for more!
5. Continue to work on the house.
Yay, another vague goal! We do have plans to cut down the remaining three trees that need cutting in the back and building some sort of woodshed for all of the wood we will be cutting. We also need to replace our hot water heater, fix the master bathroom faucet (already have most of the parts), and add/replace fans to the bathrooms and laundry room. Everything else will have to depend on if we have enough in the budget for it and time to get it done. We need to finish painting window trim (should already have the paint), do touch up paint on a couple of random areas, paint our daughter’s closet, and continue to replace outlets as we have time. All of those projects are small and can be done as needed. There is also the possibility of repainting the living room but that will be very time consuming and expensive and it might take us at least one more year to get around to it. The trees, fans and hot water heater are our priority for next year for sure!
I have way more ideas and what if goals in my head but for now these five goals will have to do! I am excited for next year. We met a lot of our goals last year and have been working hard at reducing our spending, being mindful of what we buy and trying reduce our food waste. I will be growing another garden in 2018 and my mother-in-law gave me a bunch of seeds for Christmas so I won’t have to buy many this year.
What are your goals for next year?