I read a very interesting post over at Bible Money Matters about setting your course for next year now. This article was about setting your financial goals for 2010 before it happens . Too often, we tend to wait until the next year begins to start new financial projects. Then, we forget about fixing SMART (Specific, Measurable, Attainable, Realistic, Timely) objectives in January and we wake up in spring without accomplishing much to date.

While I enjoyed the idea of setting financial goals in the fall before the craziness of the Holidays hits our lives, I wanted to share the method I tried in 2009 to attain my goals. It is quite simple and effective too! I simply ask myself 4 simple questions. I did it back in 2008 and my 2009 was a great financial success. I didn’t become rich, but I have achieved my goals. No matter if your financial objectives are too ambitious or humble; the important point is to achieve them.

So I am now repeating the very same routine in order to have a great 2010:

#1 Where Am I?

This is definitely a step that should be done prior to next year. You need to take time to draw your financial portrait on a piece of paper. This will also help to set priorities in your personal finances. So here’s my picture at the end of 2009:

- My wife stays home to take care of our children while going back to school. This was one of our goals in 2009. However, while we have what we wanted, this also means that we are now living with a single income.

- We have $260,000 in mortgage debts at a very low rate and our house is worth about $325,000. We took a lot of money out of our equity in order to do renovations. Now it will be time to pay it back.

- We have a car loan (yup, I have a new car and I don’t regret it… this will be discuss later on in another post!). The good news is that it is interest free; the down side is that I monthlies to pay for the next 6 years…

- We also have a personal debt of $31,000 to repay to my parents that is coming due in November 2010. For various reasons, we were not able to put money aside in order to reimburse this loan so far and this will be my main priority in 2010.

- I have to increase my income through various ways (getting a promotion, getting a big bonus and creating an alternative source of income through my blogs). This is probably my biggest financial success from 2009 and I intend to continue on this path in 2010.

#2 Where I want to be?

This is the time to set the SMART objectives. You want something challenging, but not impossible. It has to be something you can track down and take action to make it happen. In my case, I have decided to find ways to pay off my parents next year.

While gathering $31,000 actually seems like climbing Mount Everest, making a 6 figure income at the age of 28 also seemed unattainable back in January 2009. But with a solid plan, I have managed my way to hit it.

So at the same time of the year in 2010, I want to:

- reimburse my parents in full

- increase my blog income by 50%

- keeping my 6 figure income (which is highly variable right now!)

- allow my wife to stay home for our children

#3 What has been done so far?

While this question looks more like a follow-up question, you can also use it while setting your financial goals for the year. What has been done so far will become what has been done in 2009 that brings me to where I am. You just have to orient the answer according to your new financial goals.

While I said that not much has been done to pay back my parents, I still have a few bucks put aside. I have about $4,000 that I managed to save through my employer’s profit sharing plan. Each month, I put $475 aside in my employer’s shares (this is including my employer’s contribution). So at the end of next year, I should be able to add another $5,700 to the $4,000 I have. This is almost $10,000 out of the $31,000.

I can’t say it’s not good, but I can’t say it’s enough either! I will have to find other ways to reimburse my parents.

With regards to increasing my blogs’ income by 50% (this will definitely help increase my chances of repaying my parents!), I am now working 4 days a week at my full time job and spending a full day of work on my websites. I hope this will be enough to bring my online income to the next level.

The rest of my financial objectives are more about keeping the status quo in my personal finances. This will be done through hard work both at work and on my websites.

#4 What can be done in the next three months to get closer to my goals?

By reviewing your goals quarterly, you are in a much better position to make sure you achieve them at the end of year. You can assess if you are going in the right direction and you have sufficient time to adjust to the situation and make modifications if needed to achieve your goals.

Final Thoughts

If there is one thing I have learned from stating goals is that they become insignificant if they are not written down and if you are not committed to them. Talk about your goals to your friends and family. This will create additional motivation (pressure from within, if you prefer) and will certainly help ensure you work on them

As I am still working on my plan to successfully reimburse my parents in 2010, I would welcome any ideas!

Author: Mike.

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Even if I dropped my books, I didn’t lose their weight!

Back in April 2009, I was about to finish my MBA. I was working full time and doing my MBA weekends in the hopes of creating a better future for my family. Dealing with young children, pressure at work and deadlines for school all at the same time was definitely not part of the best moments of my life! However, sacrifices are necessary if you want to achieve financial freedom. But, there was a bigger challenge I hadn’t expected that appeared in the meantime. It was insidious, like a snake and nobody even noticed it. It was gradually taking over my body like Venom over Spider-Man; I was getting fatter everyday! During the previous 6 months, I had gained 25 pounds!

While at school, I stopped working out and started eating more. It can be considered normal as I was studying from 10pm to midnight… with my only companions, a glass of milk and a few cookies. It was to give me additional energy Well I gained additional pounds as well!

Losing 30 pounds in 4 months

Nope, I am not going to sell you some Acai berry miracle product or the latest diet I found on the net. I will actually tell you how I lost 30 pounds in just 4 months in a healthy way without spending much money.

Most people think “I am built this way” and that losing weight “is not possible” or that they would “gain it back as soon as they stop their diet”. Well here is the trick: there is no temporary method, diets included, to permanently lose weight. You simply have to change your way of living.

I actually love eating good food and think there was nothing preventing me from accessing food. Eating is probably the most accessible day-to-day pleasure in life; I didn’t want to become a slave to a diet. So, I decided to go the other way: exercise.

Find a spot in your schedule

We all make the very mistake of “forcing” a training hour into our schedules. We fit it in between two other obligations. It will probably work for a while, but sooner or later you will either feel tired or feel bored. This is because you are forcing workout time into your schedule.

I took a moment to analyse my schedule and establish the best time to workout. I found that I had more energy in the morning so I decided to wake up earlier and go to the gym every morning. After all, cutting down on my sleep wasn’t the end of the world if it could help me reduce the size of my gut!

I registered at a gym right beside work so I don’t lose time going there. And since I have to go to work everyday, I stop by the gym on the way. It is now part of my routine, instead of forcing myself at an inappropriate time. I don’t say it is easy. It can be quite a pain to wake up earlier each morning. Every time I hear my alarm ring, I wonder what am I doing; waking up so early! Then I head to the bathroom and look at myself in the mirror; this is why I have to wake-up so early!

The gym wasn’t the most frugal way to workout. However, I personally needed to spend money to commit. Since I have paid for a 1 year membership, I would lose a great deal of money if I don’t go to the gym regularly! Since I hate to waste money, it motivated me to go to the gym every day. The fact of having a personal trainer to review my program every 2 months has really helped me as well. I gave myself only 2 months to get some results, even as modest as they could be, before I met with a trainer. Since she is a professional, she was able to build a program so I lose weight faster than by doing random exercises. She also gave me additional tricks for my workout in order to optimize my time at the gym. After all, I only have 30-40 minutes in my daily schedule allotted for the gym.

The great thing about getting in shape is that the more physical activity you do the less food you feel like eating. I had been cutting out the unnecessary (and fattening!) food and the desire for junk food slowly disappeared by itself. It just doesn’t seem as appealing to me anymore!

Back in April 2009, I weighed 210 pounds. It has now been 3 months and I weigh 180 pounds. I have reduced my intake a little bit (especially sweets and deserts) but most of my weight loss has come from 30 to 40 minutes per day at the gym. However, it is an eternal challenge as gaining weight is like accumulating debt; it grows slowly and it really hurts when you look at yourself in the mirror.

The key in both cases is to apply the basics in a disciplined manner. I would be curious to know what your biggest challenge was in 2009 and how you handled it?

Author: Mike.

Image source: Nimages DR

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For some reason I can’t seem to mentally grasp that 2008 is almost over.  I feel like I was just writing this same article but back in 2007.  I like setting goals for myself.  Granted I am not near as good at meeting them as I am setting them, I do like laying out a destination for myself.  Goals help keep me focused and heading in the right direction, even if I don’t always achieve them.  As the old saying goes, it’s often more about the journey than the actual destination.

2008 goals reviewed

Here’s the number one goal I set for 2008 and how I did with them:

Goal 1: Pay a minimum of $1,000 a month towards out debt. This will be done by setting up two auto transfers from our checking account towards our debt. Each transfer will be in the amount of $500, one from each paycheck I receive.

I did terrible on this one.  To be real honest with everything going on in our lives and in particular us moving I only paid over the minimums during the first half of the year.  After that, it was pretty much just paying a little above the minimums so that we could cover repairs on our old home and save up for a down payment on our new one.

2009 Financial Goals

For 2009, I’m going to set a few more goals and try to keep them a little more realistic (the above goal to be honest was really a stretch goal).

Goal 1: Sell or rent our out our old home. For selling the goal would be to break even.  If I rent, the goal would be to recoup enough monthly to cover the mortgage, taxes, insurance, and provide a little extra to save for any necessary repairs or problems.

Goal 2: Payoff our last credit card. This one will be a bit of a stretch, especially depending on how goal #1 goals but I do feel it’s feasible.

Goal 3: Live within budget 90% of the time all year. I wanted to say 100%, but the reality is unexpected events happen.  My intent this year is to manage our budget tightly and stay only have a 10% variance against our budget and actual expenses.  While I like my spreadsheet a lot, I am going to try giving You Need a Budget another whirl.  I let you know how it goes.

Goal 4: Update my budget daily. I have not been consistent lately about updating our budget.  I go a few days where I update it daily, then stop for week (and even two weeks a few times) then go into this mad rush to update it again.  I am going to set aside a few minute each night to update my budget and know where we stand each day with our money and our budget.

I thought about adding a few more, but decided to just keep it to these 4.  This will allow me to be more focused and hopefully more successful.

2009 Blog Goals

I also want to set some goals for Gather Little by Little and my blogging business in general.  Here they are:

Goal 1: Finish my Empty Cabin Media site by the end of January. I started working on the site in November and just don’t seem to me making the progress on it like I would like.  I  need to get it done so I can begin promoting my blog consulting more.

Goal 2: Blog more consistantly. With Gather Little by Little this hasn’t been a problem.  I write 5-6 days a week here on GLBL, but my saltwater aquarium blog has really been almost forgotten and my wife and I haven’t written anything for Review Mommy in a while either.  On Gather Little by Little I’ll continue my current schedule of writing.  For Saltwater blogger and Review Mommy I’ll write at a minimum 1 article per week.

Goal 3: Reach subscriber goals of 5,000 for Gather Little by Little, 500 for Saltwater Blogger, and 500 for Review Mommy. Doing this for Gather Little by Little shouldn’t be too hard, but reaching 500 for the other too will require some work.

Goal 4: Work with at least two clients per month under my blog consulting business. I announced recently that I started doing some blog consulting.  Thus far I’ve received a number of inquires and worked with two different clients.  I have really enjoyed the work and received really positive feedback on the consulting I’ve provided.

Goal 5: Double my current blog income. Each month my overall blogging income grows, some months more than others.  For 2009 I really want to “hunker down” and double my current blogging income.  Remember, my long term goal is to begin running my blogs and consulting full time.  Doubling my current annual income will go a long way in that direction.

How did your 2008 goals turn out?  Are you setting goals for 2009?  If not, nows the time to start.  Not a big goal setter?  Just try one and see how you like it.   Any thoughts on mine?  Add a comment, I’d love to hear what you think.

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Everyone has dreams and goals, some big, some small.  I have lots of them, but for me my two primary ones are 1) Be debt free and 2) Have my own company full time.  Dream #1 is is fairly recent and became important to be in 2006.  Dream #2 has been a dream since I as kid and just kept getting stronger as I entered the work place.

I am taking active steps right now in my life to make these other dreams into a reality.  I have less than half the debt in 2006 and plan to be completely debt free except for my home within 3 years.  I’ve also started my own side business which this blog is a part of and am working hard to turn it into a viable business.  A more recent dream both my wife and I had was to live in the mountains.  We are now living that dream.

Dreams are like a vision, they are a mental picture of where you want to be someday, but dreaming isn’t enough.  Let’s look at how to turn dreams into reality.

Define your dream

The step in accomplishing your dream is to put some definition around it.  For example, you may have the dream of being a millionaire.  Well, what does that mean exactly?  Does that mean having exactly 1 million cash in savings or 2 million in investments?

In order to define steps that will take you along a path to accomplishing your dreams, you must first define the dream and make it specific.  Using my example above of owning my own company, technically I already have that.  I have my own LLC (Empty Cabin Media) and as a part of the company I have 3 blogs, 10 or so niche stores and recently started providing blog consulting services.  So I could say I have accomplished that dream, but my dream is a little bigger I want to work on Empty Cabin Media full time.

Write your dreams and goals down and evaluate them.  Are they specific?  Will you know you’ve met them when you get there?  If not, tweak them. Are your dreams on the path that God would have you on?  This is a critical factor that many people don’t consider.

Let’s say your goal is to get out of debt, or be debt free.  Make that dream or goal specific.  Word it as follows instead: “Pay off all $30,000 of my debt in 5 years.”  Now that’s a  defined dream or goal.

Define the steps

Now that we have a vision and have the dream defined next we have to work out the details of how to get there.  Depending on your Dream you may be close or you might be far away, it doesn’t matter.  In either case it’s just a matter of taking small steps.  For some the journey will be a little longer than for others, but it’s still one step a time.  Define those steps.

The debt example above is easy.  $30,000 in debt in 5 years, breaks down to $6000 per year or $500 per month.  Now of course that doesn’t factor in interest which you will need to account for, but this will provide you with a basic idea.  Excluding interest, if you pay $500.00 month toward your debt, in 5 years you’ll be debt free.  There are lots of great websites and spreadsheets available online that will factor in interest for you.  So get those numbers and do the math again for the exact monthly amount.  That amount is your monthly step.

Mine is a little more complex.  In order to quit my full time job and run my company full time, I would need to make a salary very close to what I make today.  At this point I’m pretty far from doing that.  I’ve set a goal though of 5 years, and have set specific revenue objectives I must meet each year in order to be making the same (or more) than I am making now from Empty Cabin Media.  I’ve even taken the extra step to know how much that should be per month.

The trick to reaching a dream isn’t to think about the dream itself, as the dream often seems too big or two far away.  Instead focus on the steps that will get you there.  It’s much easier to see yourself taking that next step than it is reaching the dream.  Once you have the steps define, just work on the next step, then the next step.  All of the sudden you’ll look up one day and be at your dream.

You Faith

Taking your faith into consideration is an important part of accomplishing your goals and dreams as well.  As a Christian, it’s important to me that I am not only doing what I want to do, but what God would have me do.  Am I walking the path that God would have me on?  Are my goals and dreams inline with the plans God has for my life?  These are all critically important questions to answer, as having goals and dreams inline with God’s will make the journey far less difficult and more fruitful than you can imagine.

How do you know what God’s plan is?  Pray and ask him.  If you aren’t sure what your purpose here on Earth is, I highly recommend the book The Purpose Driven Life.  This book will take you through the steps to find God’s purpose for you.  My purpose is to teach and that is also my spiritual gift.  It’s one of the reasons I started blogging and I know it’s the reason I became a manager in my professional career.

Don’t daydream

Too many people have dreams and just sit around day dreaming about how wonderful it would be live out those dreams.  While day dreaming is fun, it’s a waste of time.  Day dreaming will do nothing to help you accomplish your goals or reach your dreams.  Dreaming is the easy part, defining a plan and beginning to take the necessary steps is the hard part.

If you really want to accomplish your dreams stop day dreaming and get to work.  Far too many people don’t ever reach their dreams because they fail to take that first step.  Confucius said: “The journey of a thousand miles begins with the first step.”  A thousand miles might seem a long way to talk, but if you take it one step at a time it can be done.

My dad once had a friend that ran marathons.  He asked his friend how in the world he managed to run 26 miles.  He said he didn’t, he ran 1 mile 26 times.  He kept telling himself in his head that he only had one more mile to go…one more mile to go.  He focused on the steps, not on the dream or vision.

You must do the same.

What first step will you take today to achieve your goals and dreams?  Still day dreaming?  Stop.  Define your dream, layout the steps and take the first one today.  Why wait?  Add a comment!

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The Mighty Bargain Hunter posted an update on how his 2008 goals were going. He says it’s a “tepid start at best“, but I think he’s doing great. While he hasn’t fully met his goals, he’s recognized he has some work to do which is important. He’s heading in in the right direction. Also in his update, he decided to “pick on me” and see how I’m doing on my 2008 goal. Seems we both are off to a “tepid start at best“.

In my article, A 2008 financial goal and a chance to win an iPod I wrote about how my primary goal for 2008 was to Pay a minimum of $1,000 a month towards out debt. This will be done by setting up two auto transfers from our checking account towards our debt. Each transfer will be in the amount of $500, one from each paycheck I receive. For the month of January, I’m not doing so good frankly, but plan to fix that and maybe even make up for it a bit in February. I still plan on paying more than the minimums on our debt snowball this month, but it won’t be close to $1000.00. It will be more like $200 – $300. Due to my laziness over the holidays, I failed to anticipate a few expenses:

• Our property taxes were due this month – I knew this a year ago and saved up $1200.00 to pay them. The $1200.00 was based on the cost of our taxes last year. It would seem during the last year, our housing value’s went up as well as the tax rate, and instead of owing $1200.00 as I expected, we owed $1900.00 instead. So that $700 difference really bit into the old budget.
• Our home owners association dues are due at the end of this month – Again, this is an expense I knew about late last year, but forgot until this weekend when I starting getting caught up and getting our finances back on track. I’m setting up an ING Direct sub-account for this today, and will start putting money in there monthly so when the dues come up next year the money is already there. Not sure why I didn’t do this last year.
• Property taxes on our Durango came due – I knew this one was coming, but thought it was next month. Total amount I didn’t plan for: $81.00. I created a tab in my budget spreadsheet called upcoming bills and added the property tax, HOA dues, property taxes, etc. in this tab along with the dates due. I’ll refer to this tab each time I do my monthly budget to help me avoid missing things in the future.

I didn’t start off the year with a bang, but fully plan to meet my goal next month. I’m one to try and focus on the positives and not the negatives and with that in mind even though I didn’t meet my goal this month, I did learn some valuable lessons. I also did what we call at work “risk mitigation strategies” in place to avoid making the same mistake twice. Thanks MBH for “picking on me”. I think it’s important to share our progress (or lack there of). MBH also encouraged me to pick on some others, so I think I’ll do that:

• Lynnae said she was going to to read one personal finance book every month for the year. – How’s that reading coming along Lynnae?
• Jaimie said No more credit card debt – How’s your progress Jaimie?
• Randall told us he wanted to start paying his mortgage from secondary income – How far along are you Randall?

I’ll ask Lynnae, Jaimie and Randall to feel free to “pick on” some others as well.

Readers, how are you guys doing on your 2008 goals/resolutions (financial or not)? Did you set a goal? Feel free to write a blog post or add a comment!

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