Going into the New Year, I think more than a few of us are excited to leave 2020 behind. Between COVID-19, the election, freak storms, and murder hornets, it was a tough year.
To be honest, 2020 treated my wife and I pretty well financially. We were lucky enough to be able to keep our jobs and continue to grow our wealth, unlike millions of others who were impacted by COVID.
Our hearts go out to everyone who struggled to get by in these tough economic times. That knowledge just drives me to share my knowledge with the hope that this blog helps at least one person improve their financial situation.
If you’re struggling and looking for some advice, feel free to reach out to me.
Looking Forward to 2021
I always like to take a little time at the end of the year to reflect on what went well and set goals for the upcoming year. This past year was pretty successful for us but I’m looking forward to continuing to grow next year.
For my full review of 2020, check out this post.
Here are my goals for 2021 and I’ll check in periodically to provide updates on our status.
1. Get to $100k on our mortgage
We are currently at $150k left on our original $300k mortgage. It will be a bit of a stretch if our expenses increase next year, but our goal is to get to $100,000 or less by the end of 2021.
If all goes well, I’d like to completely pay off our house within 3 years. That will require paying at least $50k per year, plus interest.
2. Invest all available cash
It’s hard to put an exact monetary value on how much I’d like to invest this year because there may be some unexpected costs that pop up, like replacing a car. That said, my pledge is to put all our extra cash into an investment that generates at least 6% interest.
This cash will mainly be put into my M1 Finance accounts, which has averaged 9% to 20% over the past year. I also like to put some into Fundrise on a regular basis since it pays out consistent dividends.
3. Take at least two vacations
Since we weren’t able to travel with the COVID-19 restrictions, I’m hoping that we will be able to get out next year with the vaccine. We will save enough money to take at least two week-long vacations to relax and recharge.
The first week will likely be something pretty mellow since COVID isn’t disappearing as quickly as we would like. It will probably be something like a lake house, where we can relax as a family for around $1,000 for the week.
If all goes well, we would like to do a bigger trip next fall to someplace warm like the Bahamas, Aruba, or Mexico. This would be more expensive, probably around $4,000 for at least a week.
4. Expand my investment diversification
As I get some extra cash to invest, I’d like to test out a few other types of investments to further diversify. This could be something like investing in fine wine, art, whiskey, or gold.
With all of these, I will do enough research to feel comfortable with the type of investment, risk level, and liquidity. These may not all fit into my overall strategy, but I do want to investigate them further.
5. Start a real estate fund
One of my long term goals is to own a lake house that we can enjoy as a family and also rent out for extra income. To do this, we will need at least a 20% down payment for properties that could be $200,000 to $300,000.
While it will take a few years to build this up, I would like to start seriously saving for a vacation house. As part of this, I’ll put the money into an investment that is relatively low-risk and liquid enough to pull out in 3 to 5 years.
6. Plan for the unexpected
Even though we have a pretty good emergency fund and cash savings, I do want to make sure we can replenish those funds if we use them.
There is a good chance we may need at least one new car in the next year or two that will require a down payment. If we decide to start a family, we will need money for the baby. Things could happen to the house that requires extra cash.
Our overall strategy will be to save enough cash to comfortably cover the majority of unexpected expenses and be able to replenish our savings, when used up.
7. Create more income streams
Besides saving and investing, my other main goal is to increase my level of income over the next year. This will require a few different tactics.
The first being to try to get a raise at my day job. I’ll work to continue to show my value and see if I can get promoted to earn more money.
I also want to build this blog to become a consistent income source by generating quality content. On top of that, I will continue to look for opportunities to create income through digital properties and businesses.
What about you?
Now that you know what some of my goals are for the New Year, what about you? What would you like to accomplish personally, professionally, and financially?
Take some time to come up with specific goals. Then, write them down and look at them regularly. Make a plan to reach them. Take action. You can and you will reach them this upcoming year.
Best of luck!
