Tuesday, January 20, 2015

2014 Year End Budget Review

The year 2014 ended several weeks again and I finally have time to sit down and total up my numbers.  I am happy to announce that I did not incur any new debt for the year!  In fact my income was a whopping $700 more than my expenses.  I feel pretty good about that considering my career change that set me back 10% of my income.  I hope to see my savings & investing grow more this year with my car paid off.  However life tends to always change on you so who knows what 2015 holds for me.

Initially I had written about my budget and what my targets were.  When I started tracking I realized I was nowhere close to hitting those targets and when through several adjustments in how I track.  The budget goals were simply not realistic since they were not based on the past.  This year's budget should be better and more predictable.  Having information will allow me to set achievable finance goals.

Category
Initial Target
Comments
Needs
60%
Doing my best didn't even come close.  Missed by 11%.  More below on this area.
Investing
10%
Tax refund and reinvesting dividends helped here and was only off by 1.7%
Wants
20%
Formerly known as guilt free spending money.  This was combined with charity and surprisingly I spent all that I planned to.  We did have a nice family vacation and Christmas this year so money well spent.
Savings
10%
Well it was less than 1%.  Google spreadsheet charting didn't even dignify it with a percentage.  Any extra money I invested and my savings account is very sad right now.  Emergency fund, what's that? 



My needs will drop without a car payment.  I might also drop some car insurance coverage as I fully cover both our cars.  That might help get closer to 60% but I doubt it.  My house is the single biggest consumer of my income (and doesn't pay me dividends).  It does provide a home for the family but in retrospect both my wife and I agree we over paid for it.  Within a year of buying it homes in our neighborhood were going for considerably less.  Goes to show you trying to time the real estate market or the stock market never works for the majority of us.  Many lessons learned in 2014 and I look forward to what I will learn this year.  I hope you all feel the same way and will continue to grow with me.

Thanks for reading,

The Dividend Family Guy

8 comments:

  1. Always easier with realistic goals. I'm sure you'll do great in the next months. ;-)

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    1. I think so as well. Planning and setting goals is much better than flying blind like I did most of my life. Thanks for the encouragement DivGuy.

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  2. One great reason to keep dividend investing... When you can't time the market the dividends still come rolling in can smooth out the average so sometimes you might buy low, others you buy high but in the end, the checks keep rolling.

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    1. Yep dividends are simple and easy for me to understand.

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  3. Hi DFG,
    Hopefully without the car payment you'll be able to get your savings rate up. I'm looking forward to seeing your revised budget and being able to make it more accurate this year will make a big difference.

    I must admit I don't pay too much attention to house prices - whatever number you get is 6% too high (assuming you would sell it via an agent), and "fair value" means nothing if no-one will make an offer at that price. In any case you're getting a tax-break and if you have a fixed-rate loan, then inflation is making the loan cheaper each year.

    That said, I am keeping an eye out for a good opportunity to re-finance my mortgage and possibly take some equity out to re-invest though it's not looking likely for a few years with interest rates set to rise.

    Best wishes,
    -DL

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    1. I agree. Might be a few years for me as well and I do hope the rates stay low.

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  4. Looks like you have a great 2014. Hope 2015 is going to be a good year for your family!

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    1. Thanks FQA for the encouragement and stopping by. I will have to check out your world year when I get a few minutes.

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