Looking Back, Looking Ahead-With No Goals Whatsoever

As have done many, I thought I would take a moment to share with you where my financial “head” is right now.  This is usually the time of year when most people are either taking a look back at the year they had in 2009, or taking a peek ahead at what’s in store for them in 2010 financially.   I thought I would do both.

Before I do, I wanted to let you in on a little secret.  I know that I have been a big advocate of financial “goal-setting” and I firmly believe in its importance.  My secret is this:  I don’t set goals.  What?  Are you screaming “imposter” right now?  Calling me a fraud?

Well, hold on just a second.  What I mean to say is that I don’t set goals in the traditional sense.  As I have read the retrospectives and goals of other people out there, it occurred to me I don’t set goals.  Again, just not in the traditional sense.  For example, my journey out of debt.  I basically had no benchmarks, no “six months to do this”; no “by the end of the year” do that, nothing. 

My approach, as with most things, is similar to a bull in a china shop.  I was horrifically in debt, and I knew I had to do something or I’d be suffering for the rest of my life.  So, I stuck my head down (figuratively, of course) and simply bulldozed my way through my entire financial mess, until it was clean and clear and I was ready to move on. 

Then as I have also written before, I was kind of in a funk for about a year or so, because I didn’t know what to do with my newfound financial freedom.   Meaning, I didn’t know how to get my so-called “extra” income to start working for me. Here, I probably could have used a clear set of goals, I just didn’t have them.  Once I figured it out though, I simply put into place the steps that I wanted in order to start building for my future.

An example.  If you think that you will be able to reduce your power bill by 15% in the coming year, then why make a goal out of it?  Why write down “I want to reduce my power bill by 15% in 2010.”  To me, that means you can goof around the whole year before finally doing something about it.  How about this.  If you’ve identified a way or ways to make this happen-put them in place.  Get going.  Do it right now.  This has always been my approach to just about everything.

I know that there are some things that take time, and for these, a set of goals would be good.  But as I read the retrospectives of others out there and also their goals for the coming year, it occurred to me that a lot of the things that I was reading could be put into place on a more immediate type basis.

Having said that, here is my brief look back at 2009, and a concise look ahead for 2010.

2009

This was definitely a year of simply “holding on” for me.  I did not lose my job; however, I did take about a 28% pay cut.  Basically, my bonus compensation was eliminated for the year, and it was/is a big chunk of my monthly income.  It wasn’t eliminated; it was simply that the financial results of my department(s) did not match up with some budget numbers that were generated before the downfall in the economy.

I basically knew it was coming before 2009 started, but it did take a month or two to slash our household’s spending.  Mine is a one-income household, with a three year old son at home, so things were tight anyways.  Well, as I said, there was no time to sit down and map out a set of goals.  I had to slash spending, and slash I did.  We eliminated just about all forms of discretionary spending, and I cut back slightly on some 401k contributions and I did not contribute much to my Roth IRAs this year.  It killed me to do this, but as they say, you have to pay yourself first.  I also paid off our second car this year, which eliminated $250 from our monthly budget.  This could not have come at a better time.

That was part and parcel my 2009 financially speaking.

2010

Looking ahead, I of course hope to get back on track with my bonus potential at my job.  It was a good lesson learned.  This bonus money really just began for me in 2008, and our household did not handle it very well.  I kept less track of spending, and really got a little sloppy with a few things.  It was the first time I had experienced such a windfall (basically, a 2% increase in one year) and to be honest we did not handle it very well.  However, there were no “beat up” sessions, it is simply a lesson learned.

If/ when I do get back on track, I‘d like to return to my 401k contribution percentages, and even make up for what I did not contribute this year.  I‘d like to do the same with my Roths, as long as I stay under the contribution limits.

In addition to this, any savings/spending/investing ideas that I come across in 2010, I plan on putting them into place as soon as I can figure out how.

And, on a side note, I want to get rid of these 10 pounds that have been nagging me for a few years now, and keep them off!  Having a sound body goes a long way to having a sound mind.

Agree with my mindset?  Disagree?  Have your own plan you’d like to share?  Let me know-I love your comments.

Tagged as: budgeting your money, frugal living tips, how to save more money