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!


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.

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.

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.


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%.

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.


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.


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.


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.


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. 



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!!!

When An Extended Warranty Works

A couple of years ago, I purchased a treadmill for us to use for exercise purposes.  It’s been on and off again use for me, though I was just starting to get back into a regular routine last week when….


The shudder was the machine coming to a near halt while I was running at 6 miles per hour.  The thud was me jumping off and landing on the floor, and the cursing was of course my reaction to both of the events above.

Upon further testing, I could tell that the machine would run only when there wasn’t any weight on the belt.  As soon as I put any pressure on the belt, it stopped.

Lucky for me, when I made the purchase, I made the decision to purchase an extended warranty.  Normally, I don’t purchase extended warranties.  I think the only time I ever did otherwise that I can remember was when I purchased a 32″ TV back in 1997.  The price that I paid for that item was pretty high for a recent college grad, and I wanted to make sure I was protected.  Note: That TV has been the main TV in my household ever since and still works just fine.

But, back to the treadmill.  I had decided to purchase a three year warranty for the treadmill back when we got it.  Why?  Two reasons:

1) Pretty soon after I got the treadmill, I noticed a couple of problems with it and decided to have it serviced under the standard warranty that was included (which was 90 days).  It wasn’t anything major, basically there were some screws that were coming loose that I couldn’t tighten, and there was some rattling that I didn’t like.  Both were easily fixed, but the fact that I needed service initially raised the odds that I would need future repairs.
2) I actually purchased a lower end unit.  I didn’t spend a lot of money on the treadmill.  I think our total was between $400 – $500.  While that’s a lot in relative terms, it’s actually on the low end for treadmills.  For a mid range unit, expect to pay $700 to $1000, and higher end units can go for $1500 or more.  So, I knew I was getting a barebones model, and figured the old adage ‘you get what you pay for’ might come into play.  I guess I looked at it that I could spend $100 or so for the warranty or $500 extra for a better treadmill.  Not sure how dedicated I would actually be to exercising, I went with the cheaper unit.

After I ran into the problem, I called into the warranty company. I panicked wondering if they would even still be in business, but they answered the phone right away and were able to pull up my warranty with no problems.  So far so good.

I explained what had happened, and based on the symptomns, they thought it could be one of a few different things.  The way the company works is that they send out the parts to my house via UPS, and contract it to a local repair shop, who I arrange a visit with once the parts have arrived.

The parts arrived late last week.   Because of my grandma’s funeral, I didn’t get in contact with the local repair shop until Tuesday.  We set up an appointment for Thursday night (last night).  The repair man came out, took one look at the treadmill and declared it a total loss.

Apparently, the bracket that the motor is attached to needs to be attached to the frame so that the motor is parallel to the frame.  Mine was attached incorrectly, and was thus at a slight angle.  When this happens, the technician explained, it eventually throws pretty much everything off at some point.  It can run for a short or long time, but eventually the incorrect alignment will cause the unit to stop working correctly. He did say that they could do some adjustments that would get it working, but they don’t do that because they would only be temporary, and could also create a fire hazard down the road.  Yikes.  I certainly didn’t want that.  So, he took some pictures and was on his way without doing anything.

I spoke with the warranty company this morning, and while they hadn’t received the report from the technician yet, they did say that once they received his report and verified that they would replace it, I would be receiving information on how to proceed.  They had the price down that I paid for the unit, and mentioned that depending on the circumstances, I might have the option of getting an equivilient unit, applying the price towards a more expensive unit and paying the difference, or in some cases, receiving a refund of what I had paid.

They won’t send out the info until they receive the reports, so I don’t know which options will be available to me or what would be the best, but so far, everybody seem to be on the up and up as far as honoring the warranty.  I have heard horror stories of getting the runaround with warranty companies, but I haven’t gotten the vibe yet that might lead me to be concerned about this (and I have a pretty good sense for it).

Hopefully it all works out.

Stay tuned.