4 Actions to Meet Your Financial Goals This Year

4 Actions to Meet Your Financial Goals This Year

Last year my husband and I decided that we would pay off $20,000, on top of automatic payments, to student loans in one year. That seemed like a very aggressive goal, but looking back it was only a matter of focusing our finance priorities. We reached that goal by following the “4 Actions to Meet Your Financial Goals This Year.”

It’s uncomfortable to talk about finances and to talk about it so transparently. Even writing about student loan debt is somewhat embarrassing to me, but the more I shared the more I realized that many people are struggling with the same dilemma. Debt isn’t noticeable, and often times the more it is a secret the more the spending is out of control. People don’t want to talk about it because they connect their self-worth to the amount of money they have. Believe me, I did and still do this.

It’s also extremely uncomfortable to talk about within a marriage. I don’t claim to be a marriage or a finance expert, but I will say that we did not start making significant improvements until we both were on the same page with our finances. Have the uncomfortable conversations. You will both grow from it.

I don’t create budget spreadsheets. Instead I set up automatic payments each month. It’s aggressive, but also simple. I don’t have to think about all the different expenses. I just have to watch my bank account and make sure we have enough by the end of the month! Having a side-hustle really helps. I don’t include any of this income in our base pay, so it gives us a bit of cushion and allows us to feel like we’re not living paycheck to paycheck. Both my husband and I have separate incomes from second jobs.

Focus on What You Can Control

4 Actions to Meet Your Financial Goals This Year

We don’t know what the future holds, but we will be actively trying to raise our salaries in our current positions. We’ll be asking for a raise, taking on side projects that don’t take too much of our extra time, working our side-hustles, and even looking for new employment if needed.

The one thing that we do have control of now is our spending. I’ve always wanted to be a family that lived off one income and saved/invested the 2nd income. I think I can see us moving towards that goal in the future. I’m inherently pretty good at saving. I could make a few jokes about myself, but frugality does run in my family and culture. Here’s the thing though, I used to feel a bit of shame over how I watch money come in and out of our bank accounts, paying attention to the details, and implementing “spending freezes” when needed. I get it. Spending money wisely is never sexy. It’s most definitely not spontaneous, and it doesn’t evoke a sense of excitement. It most likely means going out to eat less, taking less exotic vacations, and prioritizing purchases. However, you know what is sexy? Not having a mortgage, not feeling strapped down by loan payments every month, and having the ability to give generously to family, friends, and those in need.  You know what is sexy?  Knowing my husband will have a robust retirement account growing until we don’t want to work anymore.

Personal Finances

I know and love people in my life who exude this. They’re not flashy. No, they’re just financially responsible. We hope to get to that level someday. Until then, I’ll be making a delicious and healthy meal at my home because it’s about 30$ cheaper. 🙂

This year, we’ll have to see how far a dollar can be stretched because if we lived off of one income, $50,000 a year, we could meet our goal of paying off $40,000, with some wiggle room. However, I still want to contribute to our retirement, have an emergency fund, and in general not feel like any extra expense is an emergency. We love Dave Ramsey, but we don’t totally follow his advice. I have been actively contributing to my retirement since I got my first job, and I don’t want to give that up. It’s called personal finances for a reason – it’s personal.

4 Actions to Meet Your Financial Goals This Year

As we met our first goal of paying off $20,000 extra debt in one year, I’ve gleaned some wisdom. Explained below are the most important actions to reaching your financial goals this year. Honestly, except for number one, nobody told me these factors and how important they are to sticking to your financial goals. I hope this can kick start your financial independence.

1.Calculate Your Net Worth

What’s interesting to think about is the concept of net worth. Net worth as defined by Investipedia is “ simply the value that is left after s/he subtracts her debt from her assets. Examples of debt includes mortgages, credit card balances, student loans, car loans etc.” So basically, you take all the money you have saved in your checking, savings, investments, and retirement and subtract your debts from that total.

Our net worth, as you might have assumed, is in the red. We’re owning it and getting out as fast as possible! If you have a mortgage you might be in the red as well, since your mortgage is what you owe on the home. Granted your home is the last thing you should work to pay off according to Dave Ramsey, so that was not meant to scare anyone. It’s just meant to level the playing field. Many people are in debt.

Calculating your net worth helps you accept your financial situation. You’re either above or below water and there’s no in between. You’re either broke or you’re not. Figure out what you are, and then move on with the next action step.

2. Decide With Your Partner

I’ve written briefly about this in a previous post about the actual benefits of student loan debt, but basically you need to decide together to reach a financial goal. For many years, I was bitter about our situation. I grew up in a family where for the most part I had everything I needed and more. My husband had a more volatile upbringing. I see finances as security and freedom. He sees finances as a reward. Not entirely different, but as far as financial planning can go, I was more in the long game and he was more in the short game. We’ve had many years of conversations that didn’t quite make it to the core of the issue.

This last year, instead of nagging about finances every once in a while, I just went and created my own tutoring business as a side hustle. I’m your regular busy overwhelmed mom, and adding that to my plate did create some burnout effects. However, it helped me change my perspective and I stopped blaming our financial situation on our disagreements. It didn’t take long for my husband to recognize my hard work and see the benefits and since then we’ve been working towards the same goals.

Our financial conversations are not always pleasant. We still disagree about purchases. However, we discuss yearly financial goals together, write them down, and track our progress. We encourage each other, instead of arguing about credit card statements. In general, we are a team. Be a team, simply because it’s so much easier. 🙂

3. Start a Side Hustle

Right out of college, one of my best friends needed to find a nursing job, and it was the middle of the Recession. We had this joke going that she should just stand on the side of the road and tell people they look dehydrated so she could do a health assessment for a small fee. We coined it “taking nursing to the streets!” It was my first comical idea at creating a side-hustle.

Taking Teaching “To the Streets”

My friend never took me up on the idea. I think she could have really made it big, at least uploading the videos to Youtube or something. Ironically, I recently “took teaching to the streets!” I simply created a website, wrote about my credentials, and posted a few advertisements on Craigslist. Granted, I was already a well seasoned teacher, with enough street cred. to hold my own in the rowdiest of classrooms, but it didn’t take long to get a few students. Then, family’s talked about me to their friends, and I got a few more students, and pretty soon I didn’t need to put advertisements on Craigslist, but I did need to apply for a business license. If you’re a teacher, and want to make extra money, starting a tutoring business is the fastest and easiest way. If you want to see some examples of a website, check out my reading and writing tutoring page here.

No, I’m not rich from it, but $50 for a 45 minute literacy lesson is money well deserved and exceptionally fun. I love teaching, and this side-hustle has brought me the joy of a classroom back into my life as I transitioned to a more home-based mom. Hey, it has paid for groceries most weeks!

Side Hustle = Higher Self Worth

You know what else creating a side hustle does? It shows you your self worth. I had become a bit of a martyr as a middle school teacher, with more tasks to accomplish and what seemed like little to show for it. Every year, I would literally sit at my desk and cry as I looked at our state test scores. For the record, I’m a damn good teacher, but sometimes progress is hard to see when you’re at the bottom looking up. Starting a side hustle reminded me that I am an expert in my field, and that literacy is a highly coveted skill that needs to be taught well. Getting paid directly from parents who are happy with their child’s progress makes me feel proud and grateful every single lesson.

Your side hustle could be anything. Are you good at cleaning? Clean! Are you great at organizing baby clothes? Create an organization business for new moms! Are you a great writer? Write an E-book! Just try. What’s the worst thing that could happen? Your feelings get hurt? Not that big of a deal, in my view. The book, 100$ Startup gave me some encouragement, and ultimately helped me post my first advertisement to Craigslist. Check it out!

4. Prioritize Your Spending

You have to get clear on what are actually necessities, and what truly bring you happiness and security. It has been a fun year to chisel away at experiences and things that actually bring me joy. Here is a short list of my findings.

Things I spend money on that actually bring me joy:

A spontaneous latte, a night dancing with girlfriends, a drive to the mountain, a couple extra hours of childcare, a warm fire, a glass of wine, a green smoothie, a trip to the beach, a trip to the cabin, a flight to visit family, traveling to a new place, a loved book, a new laptop, a bike for my daughter, a quality piece of clothing, a treat at a bakery, a tool, or gear used for an experience I love, a gift for a friend.

Things that I spend money on that bring me less joy:

Eating out, drinking too much, driving, eating junk food, movies in the theater, clothes I never wear, stuff I never use, the cheap version of something I need, a book I’ll only read once.

What I found was that, the things that bring me the most joy all can be budgeted for, and the things that bring me less joy actually lead to more spending. They lead to more spending because they all stem from my own insecurities, and there is no clear focus.

My point is that you have to prioritize your life to reflect what you truly enjoy. It’s so easy to just follow everyone else, but everyone else is probably in debt, and equally insecure. Decide what you think is important.

I’ve written about this in a previous post, but I’ve always budgeted money for travel. Even when we were barely making ends meet, granted my dad is a pilot, so that made things a little bit cheaper, but I cut travel costs by couch surfing in a foreign country, refusing to buy food in an airport, and traveling solo through Sweden because I really wanted to spend time with family in Finland. I made sacrifices because I knew that travel made me feel alive.  Prioritize your spending so you can prioritize the happiest experiences. 

Final Advice

If you happen to be someone dealing with debt, or just want to meet a few financial goals, I hope my writing has inspired you to change your perspective. Speaking from experience, people like an underdog. People like someone who owns their spot and grinds to meet their goals. So don’t be afraid to acknowledge your net worth. You might be surprised who you end up leading.

Join the Discussion!

What steps have you taken to change your financial future? What of these 4 Actions to Meet Your Financial Goals This Year have you already accomplished? How has debt affected your marriage? What things or experiences do you love spending money on?

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Maria Halcumb

Author

-Maria Halcumb
B.A. in Secondary Education, English, and Physical Education
M.A. Ed. in Curriculum & Instruction and Reading Specialist