2019 Goals and Resolutions

In our last post we reviewed our 2018 results. Today we’ll explore our 2019 goals.

Fostering a Child, Our Non Financial 2019 Goal

We will start with the big non-financial 2019 goal. We plan to make an addition to our family by fostering a Child. More information will be posted later in January as we complete the final steps of opening our home to a new child.

Subtle Tweaks in 2019 Goals, Measure but Stay the Course

If you go back to our 2018 post you’ll see something similar here.  We are making minor tweaks to our metrics for 2019, not systemic changes.  This is because our world does not explicitly change due to the changing of the calendar.    As such most of the factors for success we already have in place will carry through into 2019.  If it’s not broke, don’t fix it.

Income Expectations in 2019

Like in our 2018 post, as of the time of this 2019 goal setting I do not have a complete picture of our expected income.  My W-2 income received a moderate increase for year-end, which is already baked in.  However, a non-insignificant portion of our income is from my wife’s self-employment.  How significant?  In 2018 my wife’s business income covered more than 65 percent of our expenses.

Again Business Revenues are Only Guaranteed Through Q1

To review for those just joining us, my wife left the workforce to care for our children in 2016.  Six months later her former employer brought her back as a consultant working on various deliverables.  Those deliverables are generally 1-3 month projects taking around 10 hours a week of her time.  That being said, the decision to utilize my wife for those 1-3 months is literally made within a few weeks of starting that period.  So at present we only know for sure she will have work in Q1 of 2019.

Her business only has that one customer.  Should we diversify?  Probably.  Honestly, though my wife doesn’t want a full-time job, she wants to enjoy time with our kids.  Her employment is a form of self-fulfillment combined with some nice to have income.   Her current customer provides her just the right amount of business to meet that goal.    Any more, and her quality of life would suffer.  So for now she is not looking for more clients. 

Some Expense Reduction in 2019

The downside of this is should her customer hit a downturn, her income will decline.  This does make it hard to plan our financial situation, especially when combined with my income having a large incentive aspect tied to the economy.    Yet another reason it’s important for us to live well below our means.    Given that situation plus the current variability of the market, holding expenses static or decreasing them becomes even more critical. 

To this end we suspect our mortgage will pay off sometime in mid-2019, decreasing monthly expenses dramatically.  I estimate this will decrease our expenses by 25% a month starting mid-year.  Otherwise, I expect overall costs to remain constant year to year.    Note, we have 2 one-off expenses I will mention later that we expect to absorb much of the reduction in costs.  That being said these expenses are discretionary and may be delayed if the economy goes sideways.

Saving Goals 2019

Based on the above I am going to set our 2019 savings goals in line with 2018.  This is a bit of a leap of faith given the risks to large portions of our income from the economy.  That being said I have managed to continue to increase our base income. 

Also, we have begun to develop other sources of income like this blog.   While not enough to eliminate the risk, these steps do mitigate some of them.  Also in the absence of any clear signs of a real pull-back in the economy, not just the stock market, we can only plan to the current scenario.    So that’s what we are going to do.  If we repeat 2018, we should save 1.8x expenses in 2019.

Mortgage Payoff in Mid 2019 Goal

As noted above I plan to have the mortgage paid off by mid-2019. This will be paid out of the income we consider savings rate.  A note, as with 2018 asset allocation does play a minor role in this metric.   If the stock market continued to pull back significantly our allocation might need to be redirected into the market instead of our mortgage.  For now, if we assume the market gains 0 across the year our payments to our goal will maintain our desired allocation.  At present, our mortgage would pay off in 2020 if we never made another extra payment.  As such this is not a particularly stretch goal.    I promised myself a few years ago we would pay off our mortgage before the next recession.  Mark it here, knowing my luck the recession starts the day after I pay it off.

Major Expense in 2019

Mid-year 2018 we talked about wanting to become locationally independent.  Particularly I noted we wanted to purchase a travel trailer and work remotely during the summers.  This plan is still in the works but it may take until the summer of 2020 to actually implement.  Some of this delay is financial.  I do not want to make a purchase of a tow vehicle or a trailer until after our house is paid off.    I’d like to use the income retained from our mortgage to pay for the trailer.  I am currently debating selling the Corvette, a post for another time, to fund the tow vehicle.  

  That being said some of this is also out of our control.  The travel trailer we would like to purchase is hard to acquire second hand.  We are looking at a fiberglass travel trailer.  In general, these sell a few years used for more than they go for new due to the wait time for manufacturing.    Given we have patience, I plan on entering an order for the travel trailer starting in late fall for hopeful completion in the early summer of 2020.  We plan to purchase the tow vehicle around the same time we place the order.

Continue to Purchase Instruments with Expected Return of 4%

I am jacking up this requirement somewhat from 3% to 4%.  A bit of a reminder, this does not mean I expect the stock market to return 4% nor am I measuring my market return.  No this is about limiting my purchase of bonds and other assets to items expected to return on average beyond my 4% target.  So for example, I would not buy a bond returning 3% any longer, limiting my purchase to 4% bonds or above.  Of course, I wouldn’t be opposed to a market return above 4% either.

Credit Card Hacking 2019 Goal

This one is always a target, travel hack to $0 in travel costs.  We routinely miss it, having missed in 2017 by 2500 and 2018 by 2800.  But honestly, the sheer existence of this goal drives me to some big churning numbers.  How large?  Well in 2018 travel hacked approximately $4,300.  Without the goal I suspect our travel bill would be much higher.   

Besides the positive above we also have a reign on some of our travel.   One of the downsides of fostering is travel.  If we want to travel we either need permission to take the child with us or need to put the child in respite.  Respite is essentially having someone else watch the child while we travel. 

Honestly, the whole respite thing just doesn’t seem like the best thing for a foster child.  As such we are going out of our way to reduce any travel interruptions in the near term.  We will still plan to do 3 trips in the year, but I suspect those trips may lean more domestic, be shorter in duration, and expect them to land more in the second half of the year.   All things considered, I feel comfortable setting the goal for credit card travel hacking to 0 for yet another year.  Perhaps this year we’ll finally achieve our goal.

Donate at Minimum the Equivalent of 5% to Charity

Finally, on the financial side our charity 5% goal continues.    Every year we set this goal given how important it is to our values and place in society.    Nothing changes in 2019 except 5% will increase in raw number if the market holds due to our income increasing.  We are up to the challenge.

What about the Blog?

Well in 2019 we plan on continuing to remain revenue neutral.  This will be a bigger challenge than in years past since we will be attending Fincon in 2019.  Fincon is the Finance Content Conference which all the big name bloggers attend.  We decided since it will be 2 hours down the road in Washington DC in 2019 our attendance was required.  Even so, the impact of a ticket to the event and a hotel room to our blogging budget will place us way in the red based on our current revenue.  The hope is to make some adjustments in 2019 to allow for a few more affiliate links to cover this modest cost.    You still should expect these to be minimal, but given I did exactly 2 in 2018 there is a big gap between a few more links and annoying blog just trying to sell you stuff.  I promise we will stay well below that line.

Page Views 2019 Goal

 I noted in our review of 2018 that I have become a bit disenfranchised with the push to add page views.    We tend to grow about 20% a year, despite my goals being more in line with 50%.   I’ve also decided I kind of like where the blog is in terms of operation today, so I don’t expect I will make major changes in 2019.   As such in order to avoid actually getting discouraged for 2019 I’m going to set the goal as 20% based on past performance.  So instead of 8000-10000 we would expect 9600- 12000 views a month by mid-year.     We’ll see how it goes.

Anyway, that’s what I have for 2019.  What are your financial goals for 2019?