Financial Goal Setting for the 2013 New Year

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401k's, estimated taxes, financial goals, Individual 401k, New Years, Roth IRA, self-employed retirement accounts, taxes, Vanguard

Happy New Year Everyone! It is that time again. That’s right – time to set my financial goals for 2013. It’s hard to believe that 2013 is already upon us. Just two more years, and we’ll be to the year that they traveled to in the movie, Back to the Future II (one of my personal favorites!).

I do this once every year as part of my goal to create what author David Bach calls a Purpose Focused Financial Plan. The goal of this system is to employ money in your life in a way that matches your life values and dreams. It is a very cool idea!

You can read more about my journey to create this system at the following links – Creating a Purposed Focused Financial Plan and My Personal Finance Journey’s Investment Strategy.

As is the case with many things in life, a good portion of financial goals are long-term commitments requiring attention in each passing year. As such, you might see many similar goals that I was trying to or did achieve in 2012 listed for 2013. I am perfectly fine with having some of the same goals year-to-year, provided that I believe in the causes they represent (which I ponder each year, and all of the ones listed below definitely do meet that criteria!). Nevertheless, I’ve tried to call attention to completely new financial goals for 2013 by highlighting them in bold red text for easier reading. 

So, here goes, the unveiling of Jacob’s 2013 financial goals. Enjoy, and I look forward to reading any comments you all have!  

Short Term (Less Than 1 Year) Goals
  • Contribute $5500 (or ~$458 per month) to my Roth IRA with Vanguard this year (maximum allowed, which increased $500 in 2013 compared to the $5000 maximum allowed in 2012!).
  • Reach short-term net worth target for this year (1.42X my current net worth).
  • Maintain target 6-9 months of expenses in cash reserve emergency fund in Dollar Savings Direct account.
  • Rebalance mutual fund portfolio to meet asset allocation target %’s (70% equity, 30% fixed income overall).
    • Put together a will and have it reviewed by a lawyer.
    • Continue to save money for trip to Grand Canyon or to see Niagara Falls.
    • Invest $500 in Microloans with to support Latin American micro entrepreneurship. This equates to $41.67 to invest per month.
    • Donate $1,150 to Multiple Sclerosis Foundation in 2013 (5% of take-home pay in my graduate school research assistantship job).
    • Fund raise $7500 for MS 150 bike event in June 2013.
    • Save 3% of take home pay each month (after taxes) for Dream Account.
    • $30 per month save for doing running races as part of health life values account.
    • $20 per month save for buying fresh vegetables as part of health life values account.
    • Save ~33% of (blogging income (if any) – amount of income deferred to Individual 401k with Vanguard + untaxed graduate fellowship income from my research job) in a high yield online savings account in preparation for 2013 taxes.
    • Apply for new graduate research fellowships since the one I have from the NSF will run out in 2014 (and need to apply for new ones about a year ahead of time).
    • $30 per month save for trips to visit friends/family in other states.
    • $10 per month save for purchasing food for backpacking trips in the Blue Ridge Mountains once a month.
    • Contribute at least 20% of blogging income to Individual 401(k) with Vanguard.
    • Execute any business tax deductions I can for 2012 taxes.
      • Use 1% home value home maintenance fund to fix various small things that are broken around my condo after 2.5 years of use. These things include a closet door off the hinges, the light-switch in the bathroom not working all the time, and some pipes under the sink that need to be re-caulked. Once I get these things repaired, I will then need to replenish the depleted funds in the home maintenance account. 
        • Execute 4 estimated tax payments for blogging + graduate research fellowship income on the following dates – 1) April 15, 2013, 2) June 17, 2013, 3) Sept. 16, 2013, and 4) Jan. 15, 2014.
          • Save $111 per month until have a total of $1600 for health expenses for dogs we adopted (for annual health checkup, Frontline/Interceptor, and miscellaneous health emergencies/treatments needed. I will have the $1600 total after March 2013.
          • Help friends become debt-free.
          • Continue investing in long-term content growth of blog. 

              Mid-Term (3-5 years out) Goals:
              • Continue contributing $5500 to Roth IRA and Individual 401k each year using dollar cost averaging.
              • Reach intermediate net worth target (2.8X my current net worth).
              • Own a rental property by 2018.

              Long-Term (greater than 5 years out) Goals:
              • Obtain a net worth of $1,000,000.
              • Own a home free of mortgage payments.
              • Own a vacation home in the mountains or a ski resort.
              • Accumulate enough funds not have to work, but will probably anyways because I would get bored. 

              How about you all? What goals have you laid out for yourself in 2013? What technique do you find is most effective in holding yourself accountable for your goals you set?  

              Share your experiences by commenting below!

                ***Photo courtesy of


                1. John S @ Frugal Rules says:

                  Looks like some great goals! Our main goal is to get back to retirement saving. We had to put on hold putting new money into IRA's as we expanded our business last year and are getting to a place where we can start again. Hopefully we should be able to put away a significant amount into a SEP. I can't believe we're getting close to Back to the Future II btw, I loved that series!
                  My recent post Are You in Charge of Your Financial Future?

                  • Saving for retirement is definitely always a good thing John! Were you putting money in to your blogging business or your day-job?
                    My recent post You Don't Know What You Don't Know – A First-Hand Account of the State of Personal Finance Education

                2. moneybeagle says:

                  Those are fantastic goals and I love that you have helping others as an actual goal for yourselves. Not many people would consider that as a goal. Very awesome on your part. Good luck meeting all your goals!
                  My recent post Do You Prefer Instant Or Delayed Gratification?

                3. Pauline @ Reach Financial Independence says:

                  Good luck with your goals! Having so many would overwhelm me. I set a few annual goals, then split them in small monthly goals. And try to automate all the savings one to just forget about them. I like your goal about helping people to get out of debt. I'm considering teaching a financial education class in my village, people don't plan or budget and make pretty poor financial choices.
                  My recent post 13 money resolutions for 2013: #8 be happy!

                  • I love the feeling of helping real people in finance classes/seminars. There's so much lacking in the financial education in today's society that every little bit helps!
                    My recent post You Don't Know What You Don't Know – A First-Hand Account of the State of Personal Finance Education

                4. My 2013 goals are much simpler, and there are only 2 of them:

                  Save 50% of my post-tax income
                  Create $10,000 in new side income

                  I like how specific your goals are. How are you going to keep track? And how often will you review?
                  My recent post Learning To Spend Money

                  • Good questions Daniel! I set up automatic weekly, monthly, or daily reminders on my Outlook calendar to keep me on track with doing certain things.
                    My recent post You Don't Know What You Don't Know – A First-Hand Account of the State of Personal Finance Education

                5. Hi I like your various goals, very impressive! I split mine up too and have automatic things taken out of my checking account. You have very admirable and charitable goals.

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