Jan
25
2007 Financial New Year Resolutions
January 25, 2007 | 2 Comments
Last Year I started doing financial resolutions. Some other financial bloggers have them and I decided to follow suit even if I haven’t done normal New Year’s Resolutions in a long, long time.
For 2007 I plan to:
- Change Jobs – My 10+ year career has been very satisfactory. But after 10 years on the same company it is about time I try new things. I have to accomplish one of three things:
- Go into consulting – start my own business, providing the services I know how to provide and trying to grow the business into one in which I can have other consultants doing the extra work hat I can secure.
- Big company, lots of money – get more money, plain and simple. Make loads of cash to feed my investments.
- Startup – about the same money and a load of options. A place where I can feel the thrill of a very small company that I can make grow, and where I can quickly climb the corporate ladder due to my vast experience and hard work.
- Cash Only (Almost) – My brother experimented this year with a “Fun Account”, and I may want to incorporate some of it in my own life. The concept is simple; all discretionary expenses come out of a Debit Account where each month you deposit your discretionary money. Carry-overs from previous months are used for big expenses – travel, computers, etc. And when there is no money, there is no more spending – stay at home reflecting about your spending habits! I am doing the same this year. No more use of credit card! I do not care if they do not give me points/miles! If I want to work for myself some day, I need to learn how to live with plain, cold, hard cash. (Note: it is not extremely difficult, as I always had the cash in a savings account to pay the card in a sudden loss of job, but this time it is out of principle). Credit card will still remain there, as I need to use it for internet purchases, very few subscriptions, and other things in which I do not want to expose a lightly secured debit card – but as always pay full balance every month, if not sooner. For everything else, use the Master Card logo debit card.
- Dividend Income – Increase my yearly dividend and interest income by $2,000 a year. This means that on top of what I currently earn in dividends and interest (little more than $6,500 a year) I need to add $2,000 more to a total of $7,500/year. I am setting one of the 2008 financial resolutions to be $2,500 more up to $10,000/year in dividend income. This may sound like small money, but it is not a small feat. I do have a moderate growth portfolio mostly invested in stocks – a lot of them in retirement accounts which I do not count for the dividends amount. Balancing considerable growth with steady income is a challenge and an art I want to master. It is gaining perpetual income, vs. my current model that may require eating up into assets if I decide to retire today. The more dividends I earn, the easier is to try new and risky business ventures in my life.
- Emergency Fund – 6 months – I did 3 moths of emergency savings this year. I want six now – at $4,000 monthly expenses this means $21,000 ($24,000 – $3,000 in dividends) that I have to secure – double of what I have saved for that purpose. If I want to engage in risky business ventures in my life I better prepare myself for the hardships my actions may bring.
- Will, Living Will, Durable Power of Attorney, Health Proxy – This is one item I didn’t completed last year. Shame on me. It is a very simple set of documents, as all of the decisions have been taken already. It is all a matter of executing, and executing is all that counts – for thinking or even working a problem is worthless if it is not finished.
There you go, those are the resolutions. Will keep you posted about my progress through the year. What are your 2007 financial resolutions?
Related Posts:
Comments
2 Comments so far
Subscribe
Save Save Invest Invest- and I Avoid Credit cards
Big company, lots of money – get more money, plain and simple. Make loads of cash to feed my investments. ”
I like that one. Im which you on that!
[...] As a response to my 2007 Financial Resolutions posting someone asked what dividend generating stocks I use. I do have a mixture of growth stocks and cash cow stocks. Some of the growth stocks generate a small amount of dividends (and I still count those towards my yearly dividend goals), but that is not the point of this article: cash cow stocks are. [...]