Wow, it’s been a great year! Reviewing our goals for the third quarter was motivating. We’ve still got three months left in 2019, but are confident it will be our best year.
The market could crash in the last quarter. It wouldn’t surprise me at all. It doesn’t matter much though.
That’s because we set our goals based on the actions we take. Judge your process and the actions you control – not the results of things you don’t. If you save and invest over time, you will come out ahead. It’s a long game.
Based on those things, it’s easy to see that 2019 will be a successful year for us regardless of how the market performs in the final quarter.
In the first half of the year, we took the significant step of downsizing our home and saw unexpected benefits greater than just financial ones. (The financial ones aren’t bad either!)
We also passed a seven figure net worth. That could slip with a massive downturn, but anything short of a repeat of the great recession or depression and we’ll hang onto it. We’ve just made that much progress with our savings.
Before we dive in to reviewing our goal progress, a few reminder recommendations:
- Set short term financial goals that help you take action toward your long term vision.
- Track your net worth. I recommend getting started with Personal Capital if you don’t have your own system.
I try to follow a consistent format in these posts.
Each header will list the goal. Here are our 2019 Goals if you want the full context.
I’ll rate the goals like this:
ON TRACK + : We’ve either already met the yearly goal or are on track to do so and have added something.
ON TRACK / DONE : Exactly as it sounds. We’ve taken the necessary action to get there by year-end. Or, it’s already done.
NOT YET : Actions that we haven’t yet taken, or need to adjust to reach the goal.
AT RISK : We won’t make it without significant changes
Goal Updates
Goal 1: Max out Pre-tax retirement accounts
ON-TRACK +
We’ve been on track with this one all year thanks to automatic contributions. We’re fortunate enough to have both 403b and 457b accounts, with great index fund options. We automatically deduct 1/12 of our annual allowable limits each month.
The + designation comes from the fact that TFI discovered her eligibility for a 403b catch-up option available to employees who have worked for the same district for 15+ years. That’s an extra $3000 pre-tax investment! Can’t beat that.
The bulk of our investments are in these pre-tax options. Fortunately, the 457b portion is accessible if we choose to FIOR.
Goal 2: Make Roth IRA Contributions – $12000
DONE
We made these contributions back in July after selling our home.
Not a lot more to say here. Our ROTH are both in VTSAX.
Goal 3: Additional Mortage Paydown of $21,500
ELIMINATED
We removed this goal during our quarter 2 update. After selling our home, it’s no long applicable. I leave it here just for completeness.
We are currently renting while we decide on our next steps. We’re enjoying renting in the short term, but plan to eventually own a smaller home base for our retirement. We are considering options ranging from waiting until retirement and decide then, all the way to buying land and building now.
You know I’ll post about it if we make a decision and take action!
Goal 4: Taxable Investments – $28800
ON TRACK +
This goal shifted significantly after we downsized our home and cut our housing costs in half.
To balance our portfolio, we contribute $400 a month to Fidelity’s zero fee international index. Our other investments are in index funds of bonds and US equity, so this is our international holding. We have an automatic contribution set up, so this has been on track since January. Automate automate automate!
We’d originally planned to invest another $5000 in our brokerage account. However, after we sold our house and reviewed our goals, we adjusted the target. Our adjusted goal is now $28,800 total. That’s $4800 through the Fidelity auto contribution and an additional $24000.
We’ve contributed $13000 of the additional $24k. In reviewing the rest of the year, we believe we’re on track to contribute the additional $11,000 before the Christmas expenses hit. It’s a stretch.
Goal 5: Increase % Going to Charity by 1% Each Year
On-Track +
Giving is important to us. Our charity contributions hadn’t risen as quickly as our income. While we’ve always given, we want to build back to giving 10% – including once we retire. Our goal is to add 1% a year until we get there.
We’ve already given the additional 1% this year and still have two more contributions planned for the fourth quarter.
Goal 6: Meal Planning / Prepping
NOT YET
This is the goal we’ve struggled with the most. That includes just rating it! In the first quarter we were on track and had built a decent routine.
Then, we decided to sell the house and fell completely off routine. With a move and summer travel, it wasn’t happening. We rated it “At Risk” during the quarter 2 update.
We are back at it now that the school year is in full swing. Mostly. We still haven’t returned to the early success, but see a path there.
I think we’ll get there, but can’t call it a true habit/routine yet. I’ll keep you posted and hope to have this as on track/done for the final update. I’ll be honest if we don’t get there – this is the goal I’m least confident about.
Goal 7: Credit Card – Select A New Travel Rewards Card
DONE
We completed this with the Chase Sapphire Reserve. It was easy to meet the minimum spend during the move and get the sign-up bonus.
The Reserve comes with a high annual fee ($450) but includes a $300 travel credit and a few other benefits. One of those benefits is $100 toward global entry. Since we knew we’d be applying for global entry in preparation for a future trip, we decided to get this card now. Effectively, this reduces the annual fee to $50 after the travel and global entry credits are applied. It’s a solid card.
Last year, we used the Discover It and have just about completed the full cycle. The cash back doubles the first year, and all of the quarterly 5% categories work well for us.
Therefore, we decided to go for a second round of this card before going for another travel rewards. Our first Discover It was in TFI’s name, and I applied and received a new one. We’ll use it for Christmas and the 5% Amazon cash-back, doubled for the first year.
Reminder: Only use credit cards if you pay the full balance every month.
Other Wins
We continue to enjoy the benefits of downsizing, both financial and lifestyle.
After the frenzy of the move and the second quarter, we intentionally settled down a bit. Sometimes, just making steady progress and enjoying life is a total win. We’ll take it.
Oh, and I successfully transitioned from the old name/site to this one! Thanks for continuing to read.
Net Worth Update
I talked about the numbers of our net worth last quarter because we passed seven figures for the first time. Normally, I don’t publish exact numbers. This is because net worth fluctuates daily (market) and for security reasons.
We continue to make progress. We took a small hit because our rental house required a few major repairs. We still made progress overall.
Our net worth is now just over 64% of our FI goal.
Reflections
I opened by saying this wll be our most successful financial year ever. That is undoubtedly true and it feels great.
It’s amazing how far we’ve come in just a few years. We understand our financial life better, have (mostly) mastered the basics, and any tweaks now are mostly minor optimizations.
We are seeing the benefits of automated consistent investing. We’ve taken several large actions, but are at a place now where we don’t need to do anything extreme. Instead, simply by continuing what we have in place we’ll be financially independent in 3 – 5 years.
Progress – not perfection.
Summary of Goal Progress
| Description | Target | Status | |
| Goal 1 | Max out pre-tax retirement accounts | $76,000 | On Track+ |
| Goal 2 | Roth IRA contributions | $12,000 | DONE |
| Goal 3 | Additional Mortage Paydown (Goal cut) | Mortage | Eliminated |
| Goal 4 | Taxable Investments (Changed) | $24000 | On Track+ |
| Goal 5 | Increase charitable giving by 1% each year | 4% | On Track+ |
| Goal 6 | Implement Meal Planning/Prep | N/A | Not Yet |
| Goal 7 | Travel Rewards Credit Card | N/A | DONE |
Our previous 2019 goal entries:
Goal tracking is so helpful. I recently read Start Finishing, a new book by productivity coach Charlie Gilkey, which recommends no more than 5 large projects — something to think about since you have 7. I also recently read The 12-Week Year by business coaches by Brian Moran and Michael Lennington (there’s a free 3-part video on their site), and they have an interesting model of thinking of goals in terms of 12 weeks at a time to create urgency and keep people from saving the big push till end of year. These new books might be of interest!
Yep, I typically advise 3-5 in my work life. It’s something to think about here – we added two this year because the first three are mostly on autopilot now. For next year, we’ll have to think about how we handle that – removing Goal 1 makes sense, but it’s also the largest part of our financial contribution. I definitely think we’ll add short term measures to our quarterly goal reviews. Thanks for the book recommendations.