Aggressive Financial Plans For The New Year

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This New Year, my plans are different than in previous years.  I’m going with aggressive financial plans for the New Year!  This is really a part of a five year plan.

Hong Kong Chinese New Year Fireworks

Aggressive Financial Plans

  1. In 5 years, double my net worth.  This plan might not sound that aggressive, but I’ve done a fair job of accumulating net worth already.  So when you are starting out, it’s a much easier goal to accomplish than when you already have 10+ years of growing your net worth under your belt already.  So how am I going to do this task?  By increasing my Savings Delta!  It’s worked thus far, so why not push it a bit harder!
  2. Possible going into debt?!?  Sounds counterintuitive huh, or does it.  It’s pretty obvious that borrowing rates are incredible low right now, and house prices are still pretty reasonable.  So why not?  The worst that could happen is that I would own another house, but with one house totally paid off, it’s not much of a stretch buying another one.
  3. Expand and create new financial experiments.  I’m planning on continuing my lunch experiment, but actually it hasn’t ever stopped.  I’m just going to write about it more often.  I also have plenty of new financial experiments that I’ll be writing about too.  I think these ideas are what will expedite my wealth accumulation process.
  4. Control financial creep.  I’ll admit, in small ways, financial creep has gotten out of hand for me.  While I’m not buying a Lexus (yet), but I go out to eat way too much!
  5. New technology strong sites?  I know I have the technological abilities to create some interesting and beneficial sites and can do things that haven’t been thought of.  I’m hoping this year I just do it.  Barring health issues, I don’t see why I can’t…  time is ticking…
  6. Innovative Ideas?  I know that I’ve been sloppy.  I think of ideas but don’t follow them through because of time constraints (and health).  This year I would like to explore how far I can go.

 Aggressive Financial Plans Counterpoint

While I’m planning on being pretty aggressive financially next year, I’m not going to sacrifice my lifestyle in a too restricted way.  Life is short and if I go too restrictive with my finances and life, I lose the entire purpose of having money.  I have to remember that money is not the end goal, living well each year is…

 

Here’s to a Great New Year!

Don

New Year And A New Direction Blogging?

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I’ve been thinking in ways that I’ve never thought before, life has changed for me and lately I’m in a constant state of flux.

Last year, I wanted to accomplish certain goals and change my lifestyle all around.  I was only partially successful!

I was successfully in accomplishing measurable goals like weight loss and financial goals.

I was unsuccessful in change my lifestyle in a meaningful, productive or challenging way.

I’ve discovered that when I establish a plan, historically something always blocks me in my progress.  This year I was full steam ahead and making great progress when BAM, I got vertigo like symptoms that I’m still fighting to a certain extent.  I’m bending around the health problem, but it’s still taking a toll on my plans!

Another way that I’ve changed is that I no longer see just one or two ways, but instead I see an issue from multiple directions and angles.  I believe I’ve always seen a few multiple viewpoints, but now I see even more and from different sociology-economical viewpoints.  I’m not sure if I like it, but I also have come to believe that no one answer is right, but also that there are solutions that are statistically prone to a higher probability of success.

On the investing plain, I’ve discovered that often times, I won’t be able to predict what is a hit or miss.  Take texting for example, when it first came out I thought that it didn’t make sense, but now I find myself even using the medium.  How that for a kick in the pants!

Another thing is Facebook.  While I understood the appeal, I thought some things were better left in the past, but to my surprise others don’t seem to think the same as I.  I do think that it’s funny that a lot of people get arrested because they post their pictures or videos of crimes they committed on their Facebook account.  While I have a personal account, I don’t use it much because I value my privacy.  It’s a choice, no right or wrong way about it.

While I like writing about financial tips and tricks I’ve discovered and about my journey to financial independence, lately I thoughts are all over the place and it’s making it hard for me to concentrate on the niche that I enjoy so much.  Hopefully in 2013, my mind will settle and my health will return!

If I remain healthy, I’m hope to be able to bring more value to online environment by creating useful online applications (we’ll see).

Congratulations everybody for surviving 12/21/2012, in some ways it was the end of the “old” world.  Here is to the new world!  Make you mark!

Best,

Don

Year End Investment Portfolio Analysis

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So after writing the article called “Mutual Funds versus Stocks Why I Choose Stocks“, I wondered if my personal “regular account” gains from the past would trump my 401k gains.  I was especially curious about as long of a record period as I could calculate.  So ironically (or is it because I’m focused on this right now), I click on reports in my brokerage account, and low and behold, they have a calculation for the past 4 years.  So since they have such an excellent feature, I decided to perform a quick and dirty Year End Investment Portfolio Analysis!

So let’s start with my regular brokerage accounts first!  I have over 5 accounts (2 of which are my kids) and unfortunately I couldn’t eliminate my kid’s accounts.  They almost certainly pulled my average down a bit since I haven’t done quite as well in their accounts as mine (I have no idea why, but most likely because I set them in stocks and ignore their account a lot of the time).  Their accounts didn’t do horrible, but I’m sure it did pull my account average down a few percentage points.

It’s noteworthy to mention that if I was to include my ESPP money hack, I believe that my actually percentage would be up another 1/2 to 1 percent.

So here is my number for the past 4 years, 19.04% (annualized).  Not bad huh, especially since I believe the number would actually be closer to 20%

Brokerage Account Return for the Past 4 Years

Last 4 years

In my 401k, my return for this period was 11.6%, not horrible but less than the S&P 500’s return which was around 16% per year (or close to this number).

So I was pleased with my 19% (really more like 20%) number (and if you take out my kids account from the equation, the return would have been higher)…  I think my Year End Investment Portfolio Analysis verifies that I’m doing okay investing in stocks versus mutual funds!

If I were to just let the account balances ride out with no new contributions to the principal to either my 401k or regular brokerage accounts, it would take a bit more than 10 years for my regular brokerage account balances to pass my 401k balance.  So I was a little too optimistic on my regular brokerage account passing my 401k balance, but it’s still fun to have the my stocks (regular accounts) compete against my mutual funds (my 401k balance).

Here’s to a great new year!

Don

 

 

 

End of World Financial Plan Sort Of

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Well, according to some, tomorrow will be a big day from a world destruction standpoint.  I figure what better way to start the kickoff than to write an “End of the World” Financial Plan.

First let me say I’m not buying water!  Instead I’m buying Kool Aid!  Yep, why not get some caloric value out of the substance that I’m drinking.  Besides, I’d be a hero to my kids.

Kool Aid Bottles

Next, instead of buying nutritional food, I’m buying crates of ramen noodles!  You see ramen noodles are the frugal doom-dayer’s choice.  I mean does it really matter what the food you eat as long as it works, why not go doomdayer frugal?  Of course, I’ll buy some cheap vitamins too, erh actually I already have them so scratch that.  Perhaps kool aid flavored ramen noodles might taste a bit odd, but we’ll make do.  Oh, in case your curious, I have a camping burner that I’m going to use as the heating source to cook the ramen noodles.  We’ll sure miss our microwave.

Superglue, yep superglue is on my list!  It’s amazing what that stuff can bond together.  Besides, I read on the internet that zombies hate the smell of superglue!  And of course duct tape!  I actually seen a show were someone made a sailboat from duct tape.  And it worked and keep them afloat for at least 1 day!

Okay, enough negativity, what happens if the world doesn’t end?

Well, first I’m going to act as if it did from a spending perspective (except for future vacations).

So instead of drinking lattes and the cursed McDonalds Egg Nog milk shakes (yeah, I’ve been drinking way to many of those), I’m going to drink water or flavored water as I have in the past (um, not Kool Aid though, hopefully)!  Based on previous experience, I should be able to drink a glass at a cost of around 5 cents per glass versus the over $2.60 price for a small.

Next I’m going to try and increase my side income by 50% next year, and hopefully my overall income by an equal 50%.  I’m going to do this by working harder at the side income of things, and as for the employed income, I’m planning on picking up some side “employed” work!

Everything depends on my health.  It’s been a bit off since summer this year, but hopefully next year it will be a thing of the past!

Okay, I’m leaving now, but I just want to say that I really have no fear of the end of the world tomorrow.  If it were to happen, being afraid of it will do me no good.  Oh, and there is no way I’m drinking Kool Aid… that was totally a joke!

Bests,

Don