Financial Plan – 2019

Recently, I posted my goals for the new year. But while goals are important, it’s equally important to plot a path how you’re going to achieve them. Otherwise, what’s the point? Well, in this post, I will discuss my financial plan for 2019. Specifically, I will discuss the changes I’ve made in certain areas that will allow me to meet my goals. It’s not perfect and I’m not perfect. But, by accomplishing my financial plan, I think I’m well ahead of the game. Let’s dive in.

Financial Plan – 2019

One of the first things I’ve decided to do in 2019 is reduce expenses. Granted, I have a very expensive lifestyle. For example, I eat out everyday and my entertainment costs are through the roof. But that doesn’t mean I can’t reign my expenses in. Let’s see how I do that.

Reduced Housing Expenses

Currently, I live in the Bay Area of California. That can be a very expensive place to live. One of the things I decided to do was to move to a less expensive area. Thankfully, I was able to find a place and now, my rent is $600 cheaper. Honestly, I think the savings are going to be more than that based on what I would be paying for utilities. Specifically, I’ll be paying about $50 in utilities, compared to hundreds of dollars before.

There are also additional savings that come with this move. The cost of living is cheaper and so my overall expenses are going to go down.

Finally, the place I’m moving into is an IDEAL location. It’s in the heart of a down-town area, walking distance from everything. I couldn’t be more happier. The building is older, but I can totally manage. I’m also looking to buy the place from the owner, but that’s a story for another day – probably a year-and-a-half from now.

Reduced Cash On Hand

Ever since I read Ramit Sethi’s book entitled, I Will Teach You To Be Rich, I’ve adopted his approach to spending money. He advocates conscious spending, which I practice. In a nutshell, the idea being is that you make sure that the BIG things are taking care of, such as your contributions to your retirement account. Then, you can spend money on anything you want. You don’t have to nickel and dime or cut back on lattes so to speak.

I’ve done really well in making sure the big things are taken care of. I max out my Roth 401K and my Roth IRA. I also contribute to my dividend portfolio. But, I’ve found that I still WASTE a lot of money. I don’t really follow a strict budget, and that has cost me money.

So, to alleviate this problem in 2019, I’ve decided to limit the amount of discretionary income I retain. That way, the smaller the amount of money I have to spend, the better! And trust me, if I have it in my account to spend, I’m going to spend it. I’m definitely a spender!

In 2019, I will aggressively contribute funds to meet my ambitious goals and in so doing I will limit the amount of discretionary money I have to waste. I think it’s going to be great. I get the benefit of doing wise things with my money while being free from the constraints of a budget. All I have to do now is ensure that I stick to the conscious spending plan!

The Financial Plan

So, in a nutshell, here is my financial plan for 2019.

Consistent with my goals, I will do my very best to save $500 per month to pay off my rental mortgage early and $1500 a month to save for a down payment to buy another house. I realize there is some value in being focused on one goal, but I like to think I can walk and chew gum at the same time.

In the meantime, I will keep my credit cards usage and debt to a minimum. I hate carrying a balance but sometime’s it’s necessary. I don’t plan on utilizing my credit cards a lot in 2019, but we will see.

Conclusion

Above were some of the actions I plan on taking so that I can accomplish my 2019 goals. It’s not going to easy, but it will be worth it. I just need to start to get into that habit. I look forward to reporting on my progress along the way.

What are your thoughts on this post? Let me know by commenting below.