2014 Financial Goals Results

In January of this year I wrote down 3 goals for myself to accomplish this year. Here’s a recap of those 2014 financial goals.

1) Increase net worth by $55,000
Pass! From the end of December 2013 to now my net worth has increased by more than $110,000. I never expected to exceed my target by twice as much, so that’s a pleasant surprise. Here’s a rough breakdown of the $110,000 gain.

• About $50K is from property appreciation. Hurray for Vancouver real estate and Saskatchewan farmland! 🙂
• Another $15K is simply due to debt reduction. Every time I make a mortgage payment, for example, my total debt amount shrinks and my wealth increases! Hurray for easy forced savings.
• Another $30K comes from stock portfolio appreciation, dividends, interest, and rent. The U.S. stock markets are up double-digits year to date. Hurray for loose monetary policy! My $50K+ margin loan at 4.25% interest rate is kind of a drag though. Oh well, gotta spend money to make money right? 😉
• And the remaining amount of my net worth increase this year comes from good old fashioned savings.

2) Read At Least 3 Books related to money
Pass! Currency Wars, Secrets of the Millionaire Mind, and Think and Grow Rich.

3) Make $6,000 in gross dividend income
Fail! My total dividends this year only add up to $5K. I changed focus early on this year and made large investments into fixed income securities in an effort to diversify my passive income sources. I’m making about $1K a year from fixed income interest right now though.

Stretch Goal: Start an emergency fund and put at least $100 into it.
Nope. Didn’t happen. But to be fair, did anyone honestly think I would actually achieve this objective? It’s me we’re talking about here. 😛 I originally thought having an EF might be fun because then I could at least tell people I have one, since all the financial experts recommend it. But then I changed my mind when I realized I’d be lying to myself if I did that. The worst mistake an investor can make is to not be completely honest with himself. Besides, the Toronto Stock Market index returned 8% so far this year despite lower commodity prices. I’ll take my 8% return over a savings account any day.

2 out of 3 passes. Not bad overall. 🙂 If the FED raises interest rates too quickly in 2015 and triggers a major stock market correction then I may be screwed because of how leveraged I am. The other large unknown is Canada’s lofty housing market. 😐 But those are risks I’m willing to take because I can handle the volatility. Besides, life is more interesting living on the edge. I don’t drive fast cars or swim with sharks. But I get a rush from watching my investments rise and fall.

I think next year will be more about balance, such as balancing savings and spending, or income and time. If the cost of borrowing changes I’ll also have to reassess the balance between my investments and debt.

There are some people who literally save too much without enjoying life as it comes. But then there are other people who spend too much without thinking of the future. Discovering the sweet spot in between those two is where we will ultimately find happiness. 🙂 Live for today but plan for tomorrow.

Happy Holidays, folks! Remember that Christmas is not just about receiving new gifts. It’s also about other people’s presence. 😀

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Random Useless Fact:
The most popular cookie kids leave for Santa is the Oreo.