Mid-Year 2014 Financial Goals Check-In and Progress Update

Happy first few official days of Fall 2014 everyone! I hope you’ve been enjoying the milder temperatures, some pumpkin and Octoberfest beers, and have been able to get outside every once in a while!

The past few months have been very much action-packed, hence the reason I am about 2 months late getting this “mid year” financial goal check-in post up!

I finished up my PhD in Chemical Engineering on August 25th (also involved losing my health insurance coverage, but that is a whole separate post in itself), got married on September 20th, have been knee-deep in the post-PhD job hunting/interviewing process, and am currently on my honeymoon in Belize until October 2nd. The picture to the right is one of the wife and I on our wedding day.

Back in January of this year, I set my financial goals for 2014. Since the year is now more than half finished, I figured it would be a good time to sit down and take a few minutes to review how I’ve been doing thus far in reaching or NOT reaching (in some cases) the various targets I set for myself. 

Overall, I would rate the 1st 3/4 of the 2014 year as being top-notch from a personal perspective, but a great deal of mixed feelings from a financial and professional perspective.

The financial markets have done pretty well, the wife and I executed our wedding on September 20th perfectly, I was able to finish my PhD in exactly 4 years, and I was able to max out my Roth IRA contributions for the 2014 year already.

On the other hand, even though I started the job hunting process last September, it has taken longer than I expected this time around to solidify. Couple this with us being very busy preparing for the wedding in September, we are currently living on my cash savings until I secure a job. Additionally, both the wife and I are having to pay for our own health insurance – mine being through healthcare.gov marketplace, and hers being a COBRA extension from her job she discontinued at the end of August, which in total between the two of us is around $850 per month. All of this, plus paying lawyers around $2000 (at least initially, we may get some of this trust account/deposit money back) for our pre-nuptial agreement, has caused me to be in a more “reactionary” personal finance mode versus what I am used to in saving a substantial portion of my income. In addition, since I am not currently receiving a paycheck, I have had to temporarily pause all non-essential savings and charity donation initiatives.

So, here goes, a progress update (in bold below) on how I’ve been doing so far in 2014 reaching my financial goals. Enjoy, and I look forward to reading any comments you all have!

Short Term (Less Than 1 Year) Goals

• Continue building, optimizing, and balancing a Three-Legged Stool for Retirement.
  • On Track. 
    • Currently, I am at a 34%, 37%, 28% split of my assets between tax-deferred (regular IRA / 401k), taxable, and tax-free (Roth IRA / 401k) account types. The goal is to try to keep each category’s allocation close to 33%.
• 1) Contribute maximum allowed for 2013 Roth Individual 401k.
  • Complete.
• 2) Contribute $5500 (or ~$458 per month) to my Roth IRA with Vanguard this year (maximum allowed)
  • Complete.
• 3) After maxing out Roth IRA for 2014, contribute equivalent amount ($5,500) in taxable Vanguard mutual fund account.
  • Not On Track / On Hold.
    • With me currently being “unemployed” and all of the financial changes mentioned above surrounding the wedding and honeymoon, I have placed this goal on hold until things stabilize and I find a job.
• 4) If have additional funds available after completing #3 above, contribute >=20% of blogging income to Individual Roth 401(k) with Vanguard.
  • Not On Track / On Hold.
    • This is on hold for reasons similar to #3 above.
• Reach short-term net worth target for this year.
  • Achieved/complete.
• Maintain target 6-9 months of expenses in cash reserve emergency fund in Dollar Savings Direct account.
  • On Track.
• Put together Purpose-Focused Financial Plan together with wife, including long-term and short-term financial goals. Also read up on marriage/couples/family finance books as well.
  • On Track, looking to finalize in 4Q2014.
• Organize new joint / individual financial accounts for wife and I. Integrate our two finances together.
  • On Track. 
    • So far, we have successfully set up and are using a joint checking account and joint savings account with Ally Bank. The way our pre-nuptial agreement is configured is that when we get back to a position to save money again, we will contribute money to each of our retirement accounts.
    • Another part of integrating our two finances is that I am tracking every penny/dollar we are spending for the next few months to get a complete picture of all of our recurring financial commitments and patterns.
• Evaluate whether or not to rollover some of tax deferred retirement accounts to Roth status since tax bracket low.
  • On Hold since excess cash for taxes is not available right now for this type of rollover. 
• Rebalance mutual fund portfolio to meet asset allocation target %’s (70% equity, 30% fixed income overall).
  • On Track. 
• Keep maintaining zero-based budget that I have set up to strategically manage my personal finances.
  
  • On Hold. 
    • Since we are not currently receiving any income, there is not much of a need for zero-based budgeting since we are in “get by” mode.
    • Once we start receiving income again, we will resume the use of this budget system to help us achieve our short and long term savings goals while still keeping the bills paid.
    • One intriguing piece of this budget system we are working on now is creating our joint zero-based budget now that I am married.
• Towards end of 2014/after get married, evaluate if need to obtain life, disability, and long-term care insurance.
  • On Track. 
• Have draft of my will + wife’s will (which she needs to draft) reviewed by a lawyer. Also try to use same lawyer to create wedding contract for our wedding in September 2014.
  • On Track. 
    • We are in the stages of finalizing our wedding contract. Once that is signed and finalized, we will use one of our 2 lawyers for drafting wills, but that would likely take place after I land a job.
• Create and keep updated a Google Document listing out all of wife and I’s account types/locations in event either of us is injured.
  • On Track. 
    • We currently updated this with my wife’s asset accounts as well.
• Continue to save $50 per month for trip to Grand Canyon or Niagara Falls as part of freedom life values account.
  • On Track for most of year, but currently On Hold since am currently unemployed. 
• Invest $500 in Microloans with Microplace.com to support Latin American micro entrepreneurship. This equates to $42 to invest per month.
  • On Track for most of year, but currently On Hold since am currently unemployed.
  • Since Microplace.com stopped accepting new investments in January of 2014, I have had to find other alternatives for this goal. Two good ones I have found are Kiva.org and now Vested.org. Vested.org is currently my preferred provider since they offer return of principal as well as some level of interest rate of return. Kiva.org only provides return of principal. Both seem to be dependable so far!
• Invest $25 each month ($300 total for year) in Lending Club A Safety Grade Person-2-Person loans.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• Donate $1,500 to Multiple Sclerosis Foundation in 2014 (5% of take-home pay in my graduate school research assistantship job).
  • Complete.
• Fund raise $5000 for MS 150 bike event in June 2014.
  • Complete. raised $5,571 (approximately). 
• Save 3% of take home pay each month (after taxes) for Dream Account.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• $30 per month save for doing running races / bike rides as part of health life values account.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• $20 per month save for buying fresh vegetables as part of health life values account.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• Save ~20% of (blogging income minus amount of income deferred to Individual 401k with Vanguard plus untaxed graduate fellowship income from my research job) in a DollarSavingsDirect.com online savings account in preparation for 2014 taxes and to pay quarterly estimated taxes.
  • On Track. 
    • So far this year, my quarterly tax payments have been above 20% of my blogging income, so I have mostly just been focusing on paying those.
• $30 per month save for trips to visit friends/family in other states as part of friends/family and freedom life values account.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• $10 per month save for purchasing food for backpacking trips in the Blue Ridge Mountains once a month as part of health life values account.
  • On Track for most of year, but currently On Hold since am currently unemployed.
• Execute any business tax deductions I can for 2013 taxes.
  • Complete. 
• Send out 1099-MISC for staff writers for 2013-2014 taxes.
  • Complete. 
  • This was an interesting process since not all of the staff writers were a) living in the United States and b) received over the $600 threshold limit for needing a 1099-MISC.
• Use 1% home value home maintenance fund to fix various small things that are broken around my condo after 3.5 years of use. These things include a closet door off the hinges, the light-switch in the bathroom not working all the time, the bathroom towel rack holder coming unscrewed, and some pipes under the sink that need to be re-caulked. This will especially be important if we sell our condo this year in the event of a move. Once I get these things repaired, I will then need to replenish the depleted funds in the home maintenance account.
  • On Track. 
  • We had the bathroom light fixed, the hot water heater replaced, and the pipe under the kitchen sink fixed. However, there are still some other minor items that require attention if we are to sell the condo.
• Execute 4 estimated tax payments for blogging + graduate research fellowship income on the following dates – 1) April 15, 2014, 2) June 16, 2014, 3) Sept. 15, 2014, and 4) Jan. 15, 2015.
  • On Track. 
• Maintain a total of $1600 for health expenses for dogs we adopted (for annual health checkup, Frontline/Interceptor, and miscellaneous health emergencies/treatments needed.
  • On Track. 
  • In some sad news, we received word that our greyhound, Coaty, had to be put to sleep while we have been on our honeymoon due to bone cancer causing his humerus to shatter.
• Help friends become debt-free.
  • On Track. 
• Continue investing in long-term content growth of blog.
  • On Track. 
• Determine if it is more efficient to file taxes jointly or separately once wife and I get married in September 2014. Also optimize (minimize) tax bracket by balancing tax-free and tax-deductible/deferred retirement savings.
  • On Track. 
  • Since the 2014 tax earning year is not yet over, this will be something to evaluate in December. However, my initial calculations reveal that it will be more tax efficient for us to file jointly.
• Save >50% of after-tax / take-home income.
  • Was On Track until finished graduate school. 
• Save $1 per day in Making Future Child a Millionaire Account, invested in the Vanguard Total World Stock Market ETF.
  • On Track. 
  • Currently this account’s value is $243! Nice.
• Save $10 per day as a sneaky trick to stash away even more money.
  • Completed. 
  • This worked really nicely to save up some extra cash for the current unemployment period I am going through. The total that I was able to save in this way was $2400 between January and end of August.

Mid-Term (3-5 years out) Goals:

• Continue contributing maximum allowed to Roth IRA and Individual Roth/Traditional 401k each year using dollar cost averaging.
• Reach intermediate net worth target (~2X my current net worth).
• Own a rental property by 2018.

Long-Term (greater than 5 years out) Goals:

• Obtain a net worth of $1,000,000.
• Own a home free of mortgage payments.
• Own a vacation home in the mountains or a ski resort.
• Accumulate enough funds not have to work, but will probably anyways because I would get bored. 

How about you all? How have you been doing on the goals you laid out for yourself in 2014? What technique have you found is most effective in holding yourself accountable for your goals you set?  

Share your experiences by commenting below!