I started preparing my 2015 financial spreadsheet today and was surfing around online for ideas of other things I can/should be tracking in my spreadsheet. I found a list of 7 items to review at year end. I will list the items, and then add my (obviously) valuable two cents as well as comments on how I did in 2014.
1. 30 Minute Family Report Card
- Did you meet your financial goals? I'll give myself an A- on this one. I'll do a a more detailed list of my 2014 goals and how I did tomorrow, along with my 2015 goals. I will summarize here that I don't give myself an A because I didn't donate as much to charity as I set out to in 2014. I guess it's still 2014 if I want to make one last contribution....
- Did you pay off the debts that you hoped to? Debt reduction wasn't a goal for me this year...I'm now worried that means I'm doing something wrong! In fact, I increased my debt this year by buying another home. Shit. I guess on that basis I get an D (I'm going up from an F since it wasn't one of my goals, and I don't really have debt besides mortgages and planned debt...see item 2 below--man doesn't that sound like a cop out "planned debt"...Suze Orman would slap me silly and do the scary yell thing if she read that).
- Did you keep within your budget? I'll go with a B here. I met the financial goals I set for myself, but I definitely spend money on frivolous things that I don't need and could absolutely save and donate more. I keep a budget and more or less stay within the vicinity on average, but I could definitely do better.
2. Get on a Debt Diet
- List all your debts from the smallest to the largest
- 3 mortgages totaling $362K (are you wondering what those lenders were thinking giving me all that money...me too!)
- Interest free credit card to front load my home remodeling expenses and pay off before the interest free time period runs out around...this is a moving target but around $4K right now
- Day to day cc that I regularly pay off every month
- Focus all resources on paying off the smallest, then move to the biggest. This sounds like a good plan for getting results quickly when you have lots of credit cards, student loans, car payments, etc. Tackling the remodeling credit card sounds way more doable than the mortgages. Eeek!
3. Sell Positions for a Tax Loss
- Consider selling any money-losing positions or investments. This is why I have Monica. I don't want to keep track of that or make those judgement calls. Thanks Monica!
4. Remember that Happy Retirees Spend 5 Hours or More on Financial Planning
- Research shows those who spend at least 5 hours a year planning for retirement are the happiest retirees. I wish the happy factor increased with each hour you spent over 5. My budget spreadsheet consumes at least 5 hours a year, and I love every second of it.
5. Contribute the Maximum Amount to Your 401(k)
- By this he means the maximum to earn the company match; I almost had a heart attack when I read that one! The max you can contribute through your 401(k) each year is $17,500, so when I read that I was thinking it's a little late to get that done by year end...and even hard to do with a full 365 days. That would be saving $1,458/month just in your 401(k). I'm not saying it shouldn't and can't be done, but holy Hannah, I'm not doing that and I venture to guess most others aren't either. The author of the article went on to explain he means contributing enough to meet to meet the requirement to get a match from your employer. Most employers offer a match of 3-6%, which is a far cry from coming to $17,500 unless you are making at least over $300K a year. I do enough to get my company match--free money, baby!
6. Take Your Minimum Distribution
- You must start withdrawing a minimum amount started at age 70.5. I glossed over this one as I'm not even halfway to getting to think about retirement. Does anyone else envision retirement being like Scrooge McDuck swimming around in a vault of golden coins and Beyonce concerts at 4pm?
7. Use the Money in Your Flex Spending Account
- FSA is a pre-tax way you can fund healthcare expenses; it is a use it or lose it item. I personally don't need one of these right now as I don't have children to suck up every penny I make and am lucky enough to be not sick enough to need much beyond preventive care. You'll have to find another blog if you want to more about FSAs.
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