2009 Financial Goals Evaluation
At the beginning of every year, I typically set financial goals for myself. The goals are usually fairly lofty but achievable with the proper discipline and desire.
Although 2009 was a great year for net worth and income growth, there was room for improvement in terms of achieving the financial goals that I set out for myself. In 2009, I was really focused on career and business growth which pushed a lot of important items onto the back burner as you’ll see from my report below.
Goal 1: Open a TFSA with a discount brokerage and maximize the contribution – As of January 1, 2009 (or a bit later), some discount brokerages will offer a tax free trading account. We will open 2 accounts, one for each spouse, maximize the contribution ($10k total), and start the TFSA income fund strategy that I’ve written about before.
Right out of the gate, I messed this one up! As a last minute effort, I managed to open 1 TFSA account (Questrade TFSA) near the end of 2009 after reviewing my financial goals. Why didn’t I open one earlier? My original plan was to open a TFSA trading account and purchasing income trusts to increase my passive income. However, I procrastinated a bit and the markets took off leaving the trusts that I liked a little too expensive. Now that we have an account funded, I will be on the lookout for attractive income opportunities.
Goal 2: Maximize RRSP Contributions – Due to higher income in 2008, my contribution limit will be higher and I plan to maximize my contribution. This will do two things. One, it will put some cash into my RRSP account so that I can buy beaten up equities. Two, it will reduce my taxable income significantly in 2009.
I am happy about this one as I managed to maximize both of our RRSP accounts for 2009 and generate some growth due to the rising markets. For those of you who haven’t contributed yet, here is the RRSP contribution deadline for tax year 2009.
Goal 3: Pay Down Mortgage Principal by $20,000 on Top of Regular Mortgage Payments – Seems like a stretch, but in addition to maximizing both the TFSA and RRSP, I plan on paying down the mortgage principal by an additional $20,000.
During 2009, I made the decision to aggressively pay down the mortgage and I’m happy to report that it is working out better than planned. We started January 2009 with a mortgage balance of $101,200 and as of the end of 2009, the mortgage balance stands at $25,200. The relatively low remaining mortgage balance is well within striking distance of being completely paid off.
Goal 4: Charity Goals – As charitable giving is becoming more important to our family, we plan on giving at least $3,000 this year to registered charities. In addition to the financial contribution, we plan on donating at least 30 hours of our time to a local charity that we support.
This past year was a decent year in terms of giving, but didn’t quite meet the bar that I set out for myself. In terms of monetary donations, we increased our monthly giving to the local children’s hospital, continued our monthly giving to another cause that we support, and we started sponsoring a child through Compassion Canada (thanks to Kathryn for the idea). Total donated in 2009 is around the $2500 mark. Not quite the $3000 that I set out for, but I’m pleased none the less.
Donating time to charities, on the other hand, was a bit more challenging. Even with a hectic schedule, I managed to donate 15 hours this year to a local charity that I support. I hope to do more in future years.
Goal 5: Blog Goals – The quality of the Million Dollar Journey community never ceases to amaze me. I hope to continue the strong readership growth of this blog in reaching 7,000 subscribers by the end of the year.
I’m extremely pleased with how this goal panned out. We started the year with about 4000 subscribers, and thanks to you, we have doubled to over 8000 by the end of 2009. If you are interested in getting daily content updates delivered straight to your email, you can get it here. Alternatively, you can sign up for the MDJ Money Tips Newsletter which is delivered once or twice a month. It’s all offered for free of course.
Goal 6: Dividend Income Goals – One of my higher priority goals is to increase my passive or alternative income. My current Smith Manoeuvre portfolio is paying about $1,000/year in dividends which I plan to increase this year. Combining both my dividend portfolio along with our TFSA’s, I hope to reach $2,500/year in investment income by the end of 2009.
This is one of the goals which was hinged on setting up a proper TFSA portfolio. As I explained above, I didn’t get to invest within the TFSA for 2009, so passive income from investments plateaued in 2009. Although SM portfolio dividends are up to around $1,500 per year which is significantly more than last, it’s still not in the range I want to be. However, I plan to get more focused on passive income in the coming years.
Although the results were positive for the most part, there is room for improvement. Over all though, I am pleased with the way that 2009 turned out financially. For those of you who track your financial goals, how did you do in 2009?