Thursday, January 1, 2009

Analyzing my goals and finances for 2008

While my December 2008 net worth increased compared to November 2008, my first full year of net worth calculations demonstrated I was down 6.2% for 2008. I will not belabor the point that the stock market drop for 2008, ~38% overall, meant my investments took a major hit. Instead, I will do my year-end review of my goals and see where I stand there.

1. To reach a net worth of six figures ($100,000).
I looked to be on track to reach this goal until June 2008 where there was some downward market changes. However, I nearly recovered my May 2008 position in August 2008 before the market truly plummeted. In fact, I have ended the year with a net worth less than $80,000. I plan to keep this goal for next year and hope the market performs better and I save even more money to make this happen. Hitting the six-digit figure would be a great psychological boost for me.

2. To have $15,000 in liquid savings for emergency expenses.
I fell short of this goal by $1,300. I did not think I was too ambitious, but I had a major car expense in April that was large factor in holding up this goal. I also had several veterinary bills that caused me to dip into savings several times this year. Smaller, less necessary expenses did not forward my bottom line either. However, I ended the year with $3,760 more in my savings accounts (including Certificates of Deposit) compared to December 2007. This is an accomplishment well worth the time (and money) invested in it.

3. To have $500 in my "found money" account.
I have ended 2008 with $261 in this account, failing my goal. However, if all the deposits were totaled for the year, I would have nearly reached the $500 goal. When creating this goal, I wanted to see how small amounts of money (odd numbers from bonus paychecks, money from items sold on ebay and craigslist, and rebate checks) would add up over the year. These contributions alone netted almost $250. I paid for a Wills and Trust class and my chest freezer from this account. I will continue to add odds and ends of money into this account in hopes that I will save enough to buy a new (or nearly new) MacBook Pro in the future. I may modify this goal, but need to think about it more.

4. To fully fund Roth IRA for 2008 at $5,000.
My current contributions stand at $3,900, more than twice what I had at the end of 2007. However, I am still $1,100 short. To be honest, I plan on contributing my tax refunds to this account, which should get me to my goal. If I fall short, I will use some money from savings to bring me up to the full contribution. I will keep this goal on my mind (if not listed on my blog) and will joyously celebrate when this is fully funded.

5. To generate $2,000 from an alternative income source.
May I just pretend this goal does not exist? I really did not work hard on this and my final tally of less than $400 shows it. To be honest, I just pulled a number out of the air, but I also wanted to push myself with an ambitious goal. My lack of accomplishment reflects my indecisiveness on how to generate this income and that my sole idea (selling stuff on craigslist) got lost in the sudden increase of postings on craigslist this year. Having an alternative income stream (or two or more) makes me less dependent on my job and increases my ability to fund all my savings goals. I need to reflect on how to better reach this goal in 2009 and will do so in January.

Overall, I did well for my first year of goal setting. No, I did not reach any of my goals, but my financial position is better than it was last year. While my net worth does not reflect that, I am happy the liquid savings is greater than the year before and I will be able to fully fund my Roth IRA for the second year in a row (even if I need more than 12 months to do it). My hope is that in 2009, I will meet or exceed at least two of the goals I set.

How did you fare for 2008?


  1. SInce J. and I were on one income most of the year I didn't have many financial goals. We were able to continue to save despite me carrying two car payments, rent, and part of a house payment (from the house we own and rent out in another state), I was also able to fully fund my IRA. Unfortunately to get out of a second car payment we took a large hit on our savings and J. decided to purchase a used motorcycle. We paid with cash so that hurt us a lot to. Next year we will fully fund both IRAs and max out our company matching contributions in our 401ks. Now that J. has a job we should be able to put a significant amount of money away in 2009. Hopefully our investments will do better so the money isn't lost.

  2. @badhuman,

    While you did sacrifice some cash to prevent gaining debt, I think it is great that you and your partner can live on one income, save and pay down debt. Fully funding retirement accounts sounds like a great goal to reach.

    Here is hoping that 2009 will be better for everyone's bottom line!