2017 Review of Financial Goals
It’s that time of year, when we can look back at the past 12 months, and look forward to the next. I’ve just reviewed my Q4 17 goals, now it’s time to go back and see how I did over the whole year.
Reminder of long-term goal
The reason I’ve started paying attention to first monthly (ditched this – too much pressure!), now quarterly and annual goals, is that I’ve realised I want to:
RETIRE BY 55 – JUST OVER 12 YEARS AWAY, EEK!
I’ve broken this down into 4 year periods, inspired by the Olympics, and with 3 main elements: spend less, save more, earn more.
I want to:
- Find new ways of earning money so that by 2020 I’m earning enough from this to cover a third of my expenses
- Save £200,000 by age 55, which I can use until my state pension kicks in at age 67 (not that I’m relying on the state pension).
So, other than the general aim of spending less, saving more, and earning more, what specifically did I set out for myself at the start of the year?
- Shop around for a better household insurance policy at renewal, something I couldn’t face the year before.
- Improve budgeting. My system is too complicated, and I’m not good at checking how I’m doing.
- Become more organised with my finances, using my new laptop.
- Automate more, and set up separate bank accounts for different types of savings, so they take care of themselves.
- Switch an old personal pension from cash into something that actually earns some return.
- Get the cat-sitting business off the ground, and see if any other ideas I have could earn me some extra income.
- Figure out how much extra I need to earn / save so I can start making progress towards my early retirement goal.
…and how did I do?
- I switched household insurance in Q1, saving myself nearly £200. It’s unoriginal, but shopping around for our largest expenses is time well-spent.
- My budgeting still needs improving. I track my spending with the Spending Tracker app, so I have a good idea of where my money goes. I just don’t check the figures very often. My food spending has gone up this year, and I need to work out what I spent in total on other types of spending (toiletries, gifts etc.) compared to my budgets.
- My laptop has helped, both with blogging (I no longer need to borrow one, which was ancient and took an age to power on!) and finances (I have a few snazzy excel files with figures). It can definitely be improved, mostly by me actually updating the figures more often.
- I’ve automated some savings – increased pension contributions, a new standing order to an equity ISA, and continued standing orders to decent savings accounts. This is definitely the best thing I’ve done to improve my finances, as I don’t have to think about it (suits me perfectly). The pension and equity ISA are for retirement, but I don’t have separate cash savings earmarked for short- and medium-term goals. I save what I can into the best savings account I can find, then have the dilemma of deciding which of the multiple things I need to spend money on I’m going to use it for. Work still to be done on that front!
- After several years of actually losing money, I finally transferred a small personal pension which inexplicably was invested in a cash fund, into a global tracker fund. It might not be the best fund on the market, but it’s invested in stocks and bonds and is a vast improvement on cash.
- My cat-sitting business is small (tiny) but live, I actually have paying clients! Setting this up has taken up most of my spare time this year, and is my biggest achievement. I also went to a trade show in Q1 to do some background research for another idea I have for earning extra money, no details as yet as it’s been on the back-burner this year, but it’s still definitely something I plan to work more on.
- I haven’t worked out how much extra I need to earn / save to meet my early retirement goal. At present, I’ve focused on saving as much as I can afford, and activities to get the cat-sitting business off the ground.
The list above covers the broad goals I had at the start of the year, what else did I manage this year?
- Proof-read a draft of a book for my husband. He’s been preoccupied with setting up his own new business, so the self-publishing is also temporarily on hold.
- Attended a SavvyWoman event in Q3 on saving for retirement. It’s good to chat to others who are interested in the same topic, to see what they are doing, as well as listening to specialists on the subject. It all helped in becoming more knowledgeable and thinking about what is best for me.
- Bought new windows. I’m the proud owner of new windows, the first of the big house expenses we have to deal with, I’m thrilled to bits with them.
- Paid a bonus into my pension. It’s the first time I’ve ever done this. I didn’t see a penny of it, but I’ve made big improvements with my pension this year and I don’t regret it. I’ve elected to do the same this year (should I get one….).
- Switched energy provider. It supposedly saved some money, but actually I don’t think it’s turned out to be that great a deal. Something I need to look at again….
- Attended UK Money Bloggers’ annual conference in Q3. I really enjoyed chatting to other bloggers, and came away with plenty of ideas (that I’ve yet to implement!) for my blog.
- Volunteered at a local food bank. This was linked to the UK Money Bloggers’ reverse advent calendar challenge, and it was a worthwhile experience to see first-hand the work they do, and to play a small part in helping people in need locally.
The benefit of writing this blog is that I can go back over my quarterly and annual goals, and be amazed at the end of the year when I actually have a list of achievements I’d completely forgotten about! Here are my highlights though:
- I have a small business! It’s gone from an idea, and planning, and numerous tiny tasks and activities, into an actual live, real business, with 7 paying clients, which I don’t think is too bad at all! It’s part of the ‘earn more’ element of my overall goal, and though it’s minuscule at present, and hardly the ‘passive’ income I’d rather (if I don’t work, I don’t get paid), it’s a start and a something to build upon next year.
- My pension has doubled in 2 years! The sharp realisation that I needed to do something about my pension is what shocked me into blogging. I’ve increased my contributions twice over this time, initially by 2%, then by 5%, and I paid in my bonus. It’s only when you check a year or two later that you see the progress. It’s part of the ‘save more’ goal, and I’m thrilled to bits! I’ve a long way to go, but it’s an example of how you can start to see progress relatively quickly if you can make some important changes.
- I’ve set up a standing order into my equity ISA. It’s small, but it’s regular, which is what I need as have flurries of good activity followed by a drought. Again, it’s the ‘save more’ goal.
- I’ve moved my personal pension from cash into stocks. My main goal is retirement saving, so though this is a small sum of money, I feel much happier knowing the money I have saved is working as best as it can for me. It had also been bugging me for years….
- Better household insurance. The ‘spend less’ part of the goal is the one I dislike the most (there’s a surprise!), so I wanted to make sure I picked one thing that fell into this category. I’m definitely spending less, but penny-pinching leaves me feeling bad (miserable, stressed, guilty, depressed) with minimal financial benefit. Focusing on the big expenses such as household or car insurance makes much more sense. I’d rather feel bad once, spending a couple of hours shopping around and saving £200 on one insurance renewal, than feel bad multiple times over by trying to save the same amount with small items – for example, denying myself 75 lattes (yes, I’m really charged £2.65 at work for a latte…) over the course of a year, an average of 1.5 small, joy-sucking, moments, every single week of the year.
So, there we have it! 2017 is over, I hope you’ve had a good year, and thanks for reading!