I started my blog late in the year, and didn't post my 2020 financial goals here. But, I make new goals each year and track them. Here is the recap.
(1) Quit my job for full time self-employment
DONE.
To be fair, this was something that I had been planning for two years. So, the work towards this goal was spread out between May 2018 and March 2020. I made the switch the last week of March 2020, and it just happened to coincide with the pandemic lockdowns. This was absolutely heavenly because I could just make my own decisions rather than have to deal with organizational resistance and issues related to the change. I have learned a lot over this year about self-employment. The biggest things to get used to were managing my own retirement savings/contributions, and getting used to inconsistent income.
(2) Save 75% of income
NOPE. But, almost done.
I ended up saving 69.27% of my gross income this year. This is still an astonishing proportion of savings, and I am delighted by it. I chose to measure %-age of gross income since a lot of this is saved pre-tax. Included in the savings are: HSA, SEP-IRA contributions, EF/savings, additions to brokerage account, and mortgage principal paydown. Not included are mortgage interest and escrow (property taxes, insurance, PMI), any of the money put aside for taxes, and any interest/appreciation on savings/investments. I am going to keep the same goal for next year, and see how it goes. If I don't meet the goal next year either, maybe I'll revise it to 70%.
(3) Credit Score over 800
MAYBE.
If I use the FICO reported on my Citi account (reported by Transunion), my score is 845. But, I am picking the FICO reported on my Chase account (reported by Experian) to gauge this. Based on that, I'm at a 792 score right now. Either way, I am up from my score last December when it was a 748. I like to think that refinancing my house required pulling hard credit which prevented it from rising the last 8 points. Two credit cards that I was not using also closed, and this may have had an impact on the score, although I am not sure.
(4) Consistently put extra money towards the mortgage
DONE.
I put extra towards the mortgage each month. I also refinanced the house in July and went from a 4.5% rate to 3.125%. This helped more of my extra payment to go towards the principal. Now I wish I had waited longer since the interest rates continued to go lower. But, it's still a substantial savings. Even with my accelerated payoff plan, the change in interest rate shaved 1.5 years off my payoff date, and $17,800 off the total interest I will pay.
(5) Have six months worth of an EF
DONE.
I did have an EF last year, but it was not a dedicated EF. My tax savings was also doubling as my EF. This is super risky, and I decided to save a separate dedicated EF for peace of mind. Based on an MMM blog post I read, I am considering opening a home equity line of credit to use as an EF if I need more than 2-3 months of expenses. This will enable me to put about $15k more into the market. It's riskier, but $20k sitting in my Ally account isn't really doing very much. What are your thoughts on this?
(6) Max out HSA
DONE.
First time having an HSA. Fully funded for the year.
(7) Max out SEP-IRA
DONE (ish).
I won't know exactly how much more I need to add to max this out until I have year end numbers. My accountant estimates $10k more, and I have this amount saved. I just don't want to add it to my IRA account until she runs final numbers just so I am not running into any issues about contributing over the limit. This is my first year managing my own retirement accounts and contributions. It has been a learning process.
(8) Travel more, and do so frugally
DONE (ish).
I had hoped to travel more since I was anticipating having more time on my hands when I left my job. I had planned to take a cruise, go to NYC for a conference + personal time, take two camping trips, and go to Iceland and England. The pandemic changed all of this. However, my cruise (mid-Feb) and NYC conference (early Mar) both happened before the pandemic shutdowns. In retrospect, I was so lucky to not be quarantined aboard a cruise ship or catching the virus when I was travelling. The first reports of COVID in New York happened while I was there. I ended up not attending any of the conference social gatherings, and at the sessions I sat as far away as possible from others. This was lucky since many attendees reported that they tested positive in the month after. No travel has happened since I returned from NYC. I ended up getting a refund for my airfare to Europe. The two camping reservations I had made were canceled because the state parks here were closed and I was not feeling adventurous enough to go boondocking. The two trips that I did take early in the year were done frugally.
(9) Manage my health
DONE (ish).
I started 2020 by breaking my toe on New Year's Day. So, my very first expense of the year was a trip to Urgent Care and a ridiculously expensive boot that they gave me. Thankfully, that and a new pair of glasses have been my only medical expenses. I ended up losing about 12 lbs this year. Mostly, I think this was due to less stress after leaving my job and consequently less stress-eating. I also started to semi-regularly exercise since I now have more time to exercise. And, I learned how to hula hoop, and this was loads of fun. I had hoped to lose 17 lbs, and achieved most of this, so I am happy. My blood sugar is still being managed without medicine or insulin. My diabetic eye exam this year was normal. I decided not to go to a dentist this year due to the pandemic, but my teeth seem to be in good repair as far as I can tell.
(10) Create a plan for FIRE
DONE.
I have a plan to retire by my 55th birthday. I worked on it all year - this included crunching numbers, planning retirement contributions, learning how to best invest my money, spending a few hours each week reading books, watching YT videos and listening to podcasts that help me prepare for FI. I have been working and tweaking a plan for how I can make this happen, and even with very conservative estimates, I think this is doable by age 55 in the year 2034. If the market continues to rise, or my income rises (I anticipate that I can work a few more hours a week when I am working in person), I can make this happen by 2032. If there is a housing market crash and I am able to get a deal on some rental property, then this can happen by 2031.
2020 Goals Recap
December 27th, 2020 at 05:05 pm
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