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2010 Financial Goals Evaluation

As I like to stay accountable for my finances, I set financial goals every year.  Last years goals were fairly aggressive and although I’m happy with the way things worked out, there was some room for improvement.  Out of the six goals, three were achieved, one made good progress, and two just didn’t happen.  Lets take a look.

Pay off Mortgage – With about $25,000 remaining on my mortgage balance, it’s well within striking distance to being paid off.  It will be quite the personal achievement to have the mortgage paid off in less than 3 years.  Providing things go as planned, we want to be mortgage free in 2010!

I knew this goal was achievable, but I wasn’t sure it was going to happen due to the low interest rate environment and the urge to keep cheap debt.  However, near the end of the year, we decided to take some of that savings just sitting around earning very little interest, and become mortgage free.

Maximize TFSA’s – I was pretty slack with the TFSA’s in 2009, but I plan to change that in 2010.  I plan to make good use of the $15,000 remaining in contribution room.  My goal is to fully fund 2 TFSA accounts in 2010.  As of this post, I only have 1 TFSA which was recently opened with Questrade.

This goal was also achieved.   We saved cash throughout the year which gave us the opportunity to max out our TFSA contribution room ($20k).  The only issue was that a significant portion of the TFSA sat as cash and short term bonds.  Perhaps a goal for the new year is invest some of that cash!

Optimize RRSP’s – With higher reported income for 2009, there should be plenty of RRSP contribution room available for 2010.  However, with 2010 T4 income being questionable, I may only contribute enough to optimize taxation.  However, I may simply max out my contribution but carry forward the RRSP deduction should 2010 prove to be a low income T4 year.

This goal also worked out well for us.  With a relatively high RRSP contribution limit for 2010, it gave us some flexibility in getting some money out of the corporation.  What we did was calculate the maximum amount we could withdraw from the corporation in the form of a dividend so that no personal tax was payable after accounting for the RRSP contribution.  We did this for both shareholders via dividend sprinkling.

Generate More Passive Income – After selling my rental properties, passive income has taken a major hit.  The only remaining source of passive income is via Canadian dividend stocks in my leveraged portfolio.  If stocks become attractively priced in 2010, I will become more aggressive in purchasing dividend equities.

While we did increase our dividend portfolio a bit, it wasn’t as much as we expected.  Come to think of it, this goal was pretty vague as it wasn’t a quantifiable/measurable outcome, so it’s difficult to measure its success.

Consolidate Accounts – I have way too many accounts at various institutions.  For example, I have 3 non-registered trading accounts with 3 different institutions.  In 2010, my goal is to consolidate some of these accounts and simplify our finances.

This one remained on the “todo” list all year and I didn’t get around to making it happen.  One account that I plan on closing is the Interactive Brokers account.  Not that it’s a bad platform, the opposite really.  But IB is meant for traders, and although I use the pseudonym “FrugalTrader”, I do little short term trading to be worth keeping this account open.

Blog Goals – Grow readership to 15,000 subscribers. As this site has become a large part of my life, I plan to put even more energy towards growing the readership. 15k subscribers is quite the jump from 8k at the beginning of 2009, but a nice round number to work towards.

This goal proved to be a little more challenging than anticipated but we made a good run at it.  We started the year with 8,000 subscribers and by the end of 2010 we had approximately 12,500.  Even though we didn’t quite reach the 15k mark, the subscriber base did increase by over 50% which I’m pleased with.

How did you do with your financial goals for 2010?

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FT About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.

{ 15 comments… add one }
  • canucktuary January 10, 2011, 12:23 pm

    Here were my goals:
    1. Stay on budget for wedding & honeymoon expenses;
    Result: Under budget on wedding by $2,500, over budget on honeymoon by $1,500. Net – under budget by $1,000
    2. Contribute an extra $10,000 towards mortgage. (This will likely be in the later half of the year after fully recovering from purchasing a new home);
    Result: Just short of this! $9,400 in Q3 & Q4
    3. Start contributing to TFSA again in Q3. (I fell off the horse on this one in 2009);
    Result: Maxed out TFSA in Q2 – 1 quarter ahead of schedule!
    4. Create a will;
    Result: Met with lawyer on Dec 28 to draft the will…cut this one a bit close! Paperwork should be signed in the next month.
    5. Motivated by FT and Kathryn, I have started tracking my net worth. My goal is to increase my net worth by 30% in 2010.
    Result: Proud to say that net worth grew 31.22% in 2010!

  • Lily Leung January 10, 2011, 2:06 pm

    Hi Frugal Trader,

    Congratulations on hitting your goals, and huge congrats on being mortgage free. That’s an amazing achievement.

    I had noticed you significantly increased your subscribers too – what did you do differently than before to achieve this?

    – Lily

  • nobleea January 10, 2011, 2:59 pm

    I could have sworn I put up some goals last year, but I can’t find them. They went something like this:

    Sell Condo – check, completed in August. didn’t get the price I wanted, but who does. greatly reduced liabilities and feel much more comfortable

    Refinance mortgage to a lower rate – started, just finishing the paper work this week. went from P-0.4 to P-0.8 with free banking. also got it readvanceable so that the smith manoeuvre is possible.

    Open TFSAs – did not happen. Will happen this year for sure.

    Net worth – I think we had a net worth goal, but i don’t remember the %. In any event, we went up 20% for the year, so that’s nice. Looking to go up 35% this year.

  • 20 and Engaged January 10, 2011, 7:46 pm

    Our main 2010 financial goals were to get full time jobs and move out, both were completed! This year we’re looking to have a wedding for under $7k, eliminate our credit card debt, and reestablish our emergency fund. Mine also includes making passive income via my online business.

  • Echo January 10, 2011, 8:54 pm

    Congrats FT, 3 out of 6 isn’t too bad considering you made some stretch goals. Paying off the mortgage is huge and I look forward to seeing how you plan on redirecting that money now.

  • krantcents January 10, 2011, 10:38 pm

    As far as financial goals, I find the more you automate the more likely you are to succeed. Automatic payments, payroll deduction or checking account debits work! Regarding the subscription numbers, I would love to have your problem! My approach is doing a check list of things daily to build traffic. Subscriptions should follow.

  • Jungle January 10, 2011, 11:49 pm

    I guess we only really had one goal, it was net worth related. It was reached.

  • FT FrugalTrader January 11, 2011, 2:20 pm

    @Echo, I want to see that plan as well. :)

    @Lily – subscriber growth has been pretty steady over the years. I think the key is to keep writing for your readers, and to keep promoting.

  • Anthony @ ETF Trading Strategies January 11, 2011, 7:49 pm

    Nice work on the goals. One thing that has always worked for me is identifying goals and providing specific and measurable targets for each one. The next step is to automate the process as much as possible (ie. increasing automatic savings each month, increasing mortgage payments, etc).

    Goals that can’t be executed on an automatic basis can be broken down into quarterly or monthly tasks, with a simple calendar reminder that is repeated through the year (ie. Monthly reminder to update/review portfolio allocations).

    Set it and forget it, it takes care of itself if you break your goals down into mesurable steps that can be automated or easily repeated.

  • Hangul January 11, 2011, 11:21 pm

    Congrats Frugal Trader!!!

    I didn’t had any written goals.They were in my head.
    1) Make as much lump sum mortgage payments as possible
    I ended up putting in $25K towards lump sum payment. I currently have $259K left on my mortgage.My house is worth around 400K

    2) Open an RESP account
    I opened RESP account for my 6 year old daughter with cash contribution of $5K

    3) Better manage investment property
    I did sort of OK with the rental income. We had tenant turnover and had to take a hit with repairs which took a bite out of my rental income.I have so far made $5K on $44K investment in last one and half year.which I believe is 11% ROI. I can surely do better

    4) Better manage my Investment account at brokerage firm
    I had around 30K sitting in my cash reserves under my investment portfolio. I was cautious after 2008 crash. I invested 20K in stocks around Oct 2010. I made $2000 in last 3 months. I still have another 10K left which I need to invest wisely

    5) Diversify the assets
    I also ended up buying a house and a piece of land in South Asia from my cash savings. Cost $100000.

    6) Maximize RRSP contribution
    I maximized my RRSP which was around $16K

    Plan for 2011
    1) Make aggressive lump sum mortgage payment. If I can put in $25k that would be good.
    2) Repair bathroom in house & other repairs. This will set me back by $5K
    3) Make another $5K contribution towards RESP
    4) Maximize RRSP (10K) and investment into stock market
    5) Watch returns on Investment Property. This is going to be challenge. I will be monitoring the rental income till Summer 2011.if total returns reach $10K. I will keep the property otherwise I will sell it off.

    Bottom line: My expected income is $90K. I will have to save $45k to reach my 2011 goals after taking out taxes and expenses (including mortgage). This is surely not going to be easy. But I feel confident.

    I have started by brown bagging the lunch.

  • youngandthrifty January 11, 2011, 11:28 pm

    You did fantastic! I am seriously amazed at how you paid off your mortgage in three years.
    Mortgage free= bliss!

    I had way too many accounts too. I closed my BMO RRSP account and moved it over to Questrade. I still have a non-registered BMO investorline account but it’s just sitting there and I dont’ trade with it.

    How come you guys sold your rental property? Are you planning to acquire another one? (With the minimum 20% down for investment property now, buying investment properties definitely isn’t as attractive).

  • youngandthrifty January 11, 2011, 11:29 pm

    Also amazing that you have 12K in subscribers! I have barely 1/6 of the subscribers you have :)

  • FT FrugalTrader January 12, 2011, 10:28 am

    Thanks for the kind feedback guys!

    @youngandthrifty – You’ll find that once you get past a certain point in the number of subscribers, it just keeps snowballing. Regarding the rental property, I’m going to have a series of posts about that coming up soon!

  • Emily January 12, 2011, 2:04 pm

    I started reading this blog mid year and had many goals, none however written down. I had started doing my monthy networth statements and had reported being neg -$5200 as of Sept 10. By Dec 10, I was at -$2300 so my main goal was to hit the positive in short order.

    Over the holidays our engine went unexpectedly in our car $4000 and then shortly thereafter recieved another unexpected bill of $800. Thankfully as I had paid off the visa and had some in savings we were going to survive however these circumstances have really jolted my priorities and willingness to “plan.” I will get back on track and start again however, perhaps an article on this would be appropriate at some point as I know Im not the only one who has had this ‘series of unfortunate events.’

    Current Goals for 2011:

    Save the exact dollar amount for this holiday season’s misgivings to avoid in the future $4800

    Save up $1000 to open first online brokerage account

    Look into moving current RRSPs to a low fee account

    Pay off all consumer debt $9500

  • Jane Sanders January 12, 2011, 10:49 pm

    Congratulations on paying off your mortgage! That’s a huge accomplishment, especially in only 3 years. It seems like you did well on your other goals as well. I actually think it’s a good thing that you didn’t it every single one. It means you’re aiming high enough to challenge yourself.

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