Review of 2009 Financial Goals / New Goals for 2010

I track our net worth, and the components that comprise our overall net worth, on an Excel spreadsheet.  At the end of each year, I put in ‘goals’ for each category for how I would like the upcoming year to play out.

Since December is the last month, and I’ve already done our net worth analysis for the month, I can look back at the last twelve months and see how we did.

Away we go!

ASSETS

HOUSE
2009 Goal:   -5.1%

2009 Actual:   -11.6%

2010 Goal:   0.0%

Comments:   Based on the performance of the housing market, I had estimated that the value of our home would continue to fall.  I had hoped it would ‘only’ fall around 5%, but unfortunately, it fell quite a bit more than that.  The encouraging thing is that the rate of decline has slowed over the past few months, so I’m hoping that things level off.  Therefore, I will be happy if the value of our home stays the same over the next twelve months, and have set that as my target for 2010.

CARS
2009 Goal:   +25.4%
2009 Actual:   +43.4%

2010 Goal:   -8.2%

Comments:   I had planned on purchasing a car, which we knew would be necessary once we had Baby Beagle.  Therefore, I was counting on the value of our cars to go up for the year since we would be replacing our least valuable car with a more expensive car.  This took place.  I don’t anticipate any change in what we own in 2010, so I simply anticipate regular depreciation.

INVESTMENTS
2009 Goal:   +14.6%
2009 Actual:   +33.9%
2010 Goal:   +4.7%
Comments:   I had hoped for somewhat of a rebound in the stock market, and this was answered….and then some.  While the overall value of our investments are disappointing compared to what we paid for them, we saw a recovery of a good portion of our 2008 losses.  I think that the upward trend of the stock market will slow down or even reverse slightly in 2010, so I’m setting a conservative goal for this category.

CASH

2009 Goal:   +17.8%
2009 Actual:   -3.3%

2010 Goal:   +11.6%
Comments:   I didn’t have any real reason for forecasting an increase here except for possibly being too optimistic.  I knew that we’d be purchasing a car which would reduce our cash holdings.  This happened, and explains a slight decrease for the year.  We are not currently planning any major expenditures for 2010, so I’m hoping to boost our cash savings by a modest 11%.

RETIREMENT
2009 Goal:   +53.0%
2009 Actual:   +77.1%

2010 Goal:   +18.8%
Comments:   I was more aggressive in forecasting our retirement savings (compared to the Investments category), but there were several reasons.  First, is that I am making regular contributions.  Second, I had anticipated that my employer would continue matching those contributions.  Third, because retirement is so far away, the investment classifications are overall more aggressive.  All of these played into a substantial gain for the year.  This would have been more, but my employer cut their matching contributions in early summer.  I’m forecasting an 18% gain, which would basically happen if there was a modest gain in the market and we continue our rate of contributions.  Should our employer start kicking in again, this could be higher.

DEBT

MORTGAGE
2009 Goal:   -1.5%
2009 Actual:   -1.4%
2010 Goal:   -1.7%
Comments:   This is probably the most boring category, as we simply make the minimum payments on our 30-year fixed rate mortgage.  Eventually, within a couple of years, I’d like to start paying this down more aggressively, but for now, the numbers are pretty self-explanatory.

CAR LOANS

2009 Goal:   $0
2009 Actual:   $0
2010 Goal:   $0

Comments:   I didn’t do percentages here because you can’t divide by zero.  We didn’t have any car loan debt coming into the year, and it was my goal to not add any new debt in this category.  Mission accomplished, as we paid cash for our upgraded car.  Since we’re not planning on making any changes to our car ownership this year, our goal for 2010 is simply to keep the $0 balance here.

CREDIT CARDS

2009 Goal:   $0

2009 Actual:   $0

2010 Goal:   $0

Comments:   Actually, the same goes here as in the car loan category.  While we do use our credit cards, we pay off our balances every month, and this is reflected here.  Our goal for 2010 (and forever) is to keep this at $0.

STUDENT LOANS

2009 Goal:   -29.3%
2009 Actual:   -25.4%

2010 Goal:   -26.0%
Comments:   Any extra payment we have towards debt goes towards two student loans that we have.  We are paying the higher interest one off first, and were able to lop off 43% of that balance.  The minimum payments on the second, lower interest loan, allowed us to pay off 8% of that balance.  Overall, we came pretty close to meeting the target.  While we won’t be able to put as much towards them in the upcoming year (since we’re a single income family now), the percentage paid off is actually targeted to be about the same as last year.  This is because the beginning balance is lower. 

OVERALL

NET WORTH

2009 Goal:   +39.4%
2009 Actual:   +40.6%
2010 Goal:   +20.7%
Comments:   Even though the value of our house was a major drag, the stock market recovery offset this so that we were still able to meet our goal.  I’ve been tracking net worth since 2001, so this is the eighth full year I have to compare, and the 40% increase is the biggest percentage increase I’ve noted since I started tracking.  While this is nice, it’s still dampened by the fact that the 40% increase follows a 42% decrease that took place in 2008, showing that our personal recovery is still a long, long ways off.

However, the fact that we recovered so much was a bright spot.  The other bright spot is that, although the overall number is way down from all-time highs, the main reason for that is the value of our property.  I actually keep track of our net worth excluding real estate, and that number is at an all-time high!  This shows that our strategy of investing in retirement while paying down debt is working for us, and that while the real estate market is slowing us down, we’re still headed in the right direction.

Since we slightly beat our overall target goal for 2009, I’m extremely pleased.  Of course, now the focus is meeting (and beating) our goals for 2010, so as I said earlier….

Away we go!!!

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1 thought on “Review of 2009 Financial Goals / New Goals for 2010

  1. I fully agree with your comment, "This shows that our strategy of investing in retirement while paying down debt is working for us." You had a busy and wonderful 2009. Wishing you a prosperous and joyous 2010!

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