2012 is here and it’s time to look at our financial goals for the year.
In order of how I have things tracked on our balance sheet:
- A modest increase in our home value – I would be happy if our home value increased by 1% over the current value. Last year was the first year in many that we actually had an uptick in the noted value, so it would be nice to see that continue.
- A modest decrease in the value of our automobiles – I’ve budgeted a 13% decrease in the value of our automobiles (and RV) We have a 2007 Buick Rainier, a 2006 Pontiac G6 and a 2004 Jayco Feather camper. I use Kelley Blue Book for the car values and I’ve decided to do a straight-line depreciation for the camper.
- A 25-30% growth in our investment account – I am bullish on some of the stocks I own. If even one or two can break out, this could lead to out performance of the market, which would be nice since our holdings under performed the market in 2011.
- A 15% increase in our cash holdings – We took a hit in our cash savings when we bought the camper. This increase would bring us back to where we were, and increase our earmarked allocation for some of the savings goals we have (like a new roof in 2013-14)
- A 15-20% increase in our retirement balance – Regular contributions plus a nonimal gain the stock market would allow us to reach this goal. If the market has a down or flat year, we could potentially miss this goal.
- A 5-6% decrease in our mortgage balance. Regular payments would allow us to make this goal. Now that we have re-financed into a 3.375% 15-year loan, we are comfortable with making the minimum payments for now, choosing to put extra into cash, investment, or retirement funding.
- A 11-12% decrease in our student loan balance – Again, minimum payments will allow us to meet this goal. With a locked in rate of under 2.5%, and a monthly payment under $100, we are OK with not paying extra on this for now.
- An overall net worth increase of 22%. All of these things together would add up to a 22% increase in net worth value for the year. We only achieved 10% in 2011, which is pretty good, but below the growth I want to see.
Hopefully market, job, and other conditions go our way to allow us to reach our goals in 2012. Exceeding them would be even better!
What are your goals for the new year financially?
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A couple of your goals are out of your hands, isn’t that frustrating? You can do everything right and not hit your targets….
In all honesty, I realize that many are out of my hands. You have no control over the things that affect the global economy or individual companies, which in turn affect your stock holdings. Between retirement accounts and investment accounts, that represents a big chunk of my net worth. You have to just hope for the best.
Dean makes a good point for some of those- what are you going to do if KBB ravages your auto values? ON the other hand, your home isnt completely out of your hands – you can upgrade a bathroom or something, and that couldhelp you get the value increase you are looking for.
I base the car value estimates on historical trends. After a while, you get a pretty good idea of how much a car value will decrease over time, so I’m generally comfortable with that.
We’re not planning on doing any major remodels for at least another 3-5 years, but the increases we’d be eying in the mean time would be from continued stabilization of the real estate market. Again, you never really know.
I’m interested in your investment account goals. How many stocks/bond do you invest in to anticipate this type of return?
Best of luck in reaching these!
It’s a stretch goal but we have some stocks that have taken heavy hits because of things going on in Europe. We’re remaining optimistic that things over there will stabilize without a catastrophic impact on the economy, at which point things would look favorably for us.
I’m also hoping my home appreciates….especially the rental house. It’d be great to have that home in the black so I can decide when the best time is to unload it. Want to buy a house in Detroit?
In the city of Detroit, no thanks, not until they get out of their current crisis via bankruptcy or whatever they end up doing. We’re in the suburbs in a city that’s managed through the storm quite well.
These look like ambitious goals. It is true that some goals are out of your hand, but you have control over a large portion of them. As detailed as you are about finances, I am confident you can do it!
Thanks for the vote of confidence! I hope to report positive results in a year!
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