I haven’t listed my personal financial goals before mainly because the more interesting ones tend to be fuzzy. But I’ll take a stab at it here.
1. Zero debt
I have no debt right now and I’d like to keep it that way. There can be good reasons to take on debt, but they don’t apply to me at my current stage of life.
2. Keep our 2015 total family spending to the same level as 2014
We don’t really use a budget, but we do look back at how much we’ve spent on everything. We add a monthly charge for very infrequent costs such as a new car, new roof, new windows, new furnace, and new flooring. This charge applies every year whether we buy any of these items or not. With these costs charged every month, I don’t count the cost of a new car in the year we buy it (unless we pay more than planned for the car or we buy new cars more frequently than planned). The same applies to the other infrequently-purchased items.
3. Max out my RRSP
I have no RRSP room left now, and I intend to use all of the new room that comes in 2015.
4. Max out TFSAs
My wife and I have no TFSA room left right now, and we plan to use up the combined $11,000 of new room that we’ll get for 2015.
5. Save as much as possible in non-registered accounts
This is where things start to get fuzzy. I’ve had components of my income that are variable for many years now. I have some control over them, but not much. If my company has a good year financially, I get more money. If not, I get less. With my more precise goals on the spending side, at least it means that whatever I get as variable income gets saved.
6. Strike a balance between enjoying life today and saving for the future
Lots more fuzziness here. This one is potentially in conflict with goals 2 and 5. If a very interesting opportunity to do something fun comes up, I may take it and spend more than I intended for the year. This way of thinking can be dangerous for those who tend to spend beyond their means. However, with my family’s saving rate on take-home pay at roughly 70% for 2014, I’m not at risk of spending my way into poverty.
I often tell people who set personal financial goals that they need to include a debt-related goal as I’ve done here. Perhaps I’ve missed an important goal as well. Please leave a comment if you have ideas for improving these goals.