Personal Finance 

What’s Your Big Money Goal for the New Year?

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Happy New YearIn the past, I used to list all the things I wanted to change about my finances at the beginning of the New Year. And then become instantly frustrated as I tried to do too much, and then ended up giving up by March and accomplishing nothing.

A few years ago, in order to break that cycle, I decided to focus on one or two big money goals each year. Instead of trying to fix everything all at once, I started identifying one or two major goals, and then working to accomplish them. The result was that my finances improved appreciably — and the change was more permanent.

This Year’s Big Money Goal: Prepare for a Possible Move

In the past, I’ve done things like pay down credit card debt (that was goal that took multiple years), boost retirement account contributions, and build my emergency fund. All of these big goals require some planning and sustained effort, and required that I break it down into doable actions.

This year, though, I’ve decided that I need to get things in order for a possible move. My husband is an adjunct professor right now, but he’s considering other job options, and plans to begin applying for full-time positions next year. But we’re not quite ready to move, and here’s why:

  • We are upside down on our mortgage. Thanks to declining home values in my area, we are $3,000 underwater.
  • To sell, judging from the recent home sales in our neighborhood, we’d have to discount our home by $15,000 to $20,000 from our purchase price. (We had a small down payment, and now it’s haunting us.)
  • Even though we’ve gotten rid of quite a bit of stuff, there’s still quite a bit that we’d have to move with us. And we’re not excited about that prospect.
  • We don’t have as much as I’d like saved up for a down payment on another home.

Luckily, my job is something I can do from anywhere. Additionally, we have enough money available that we can afford to pay for my husband to travel for interviews if needed. And, even though the stuff thing is annoying, it’s something that can be dealt with fairly easily; I can take a few minutes each week to go through rooms and donate unwanted items to the thrift store.

Chances are that we won’t buy something upon immediately moving to a new city (if we do, indeed, move), so the down payment isn’t urgent. What’s really pressing on my mind is our current mortgage. Our equity situation, and my self-employment has made it difficult to refinance the home. But the real challenge is that we need to drastically reduce the mortgage balance before we sell — especially since I’m not fond of the idea of trying to force my way through a short sale.

So, for the coming year, I will probably focus my efforts on reducing our mortgage balance. That means putting extra money toward the principal each month. In order to do that, I will likely break it down, and look for ways to divert some of our disposable income into mortgage payments. It probably means fewer trips (I’m not giving up FinCon, though), and less eating out. My husband my have to reduce the number of action figures he buys.

And I’ll probably take on an extra project or two, while my husband has already been offered an extra class during the summer. If we take it a little at a time, we will likely reach our goal of reducing our mortgage principal, and preparing our finances for a possible move in the next year or so.

What about you? What’s your big money goal for the New Year?

(Photo: F. Montino)

{ 18 comments, please add your thoughts now! }

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18 Responses to “What’s Your Big Money Goal for the New Year?”

  1. Bridget says:

    My big money goal this year is to pay off my car note. I just want to be free of that bill. Good luck on your mortgage. I know a lot of people who are upside down in their mortgage and some of them have no choice but to short sale their home.

  2. Our big money goal this year is to get rid of my girlfriend’s student loans! She started out with over $80,000 and I actually just posted an update of where we are today on my blog if you’re interest in our progress!

  3. ChrisCD says:

    First, is actually thinking about them and then listing them on paper. Then breaking it down into smaller pieces. Unfortunately I have some big tax bills so it isn’t fun thinking about them.

    Have you considered renting out your house?

    cd :O)

  4. PawPrint says:

    I’m curious why you would pay down a mortgage of an underwater house that you want to sell instead of saving the money (earning some interest, little as it might be) so that you could just bring the difference to the closing table?

    • Miranda says:

      That’s a good idea. We’ll probably just do that instead 🙂 That way, if we don’t end up moving, we’ll have the money to build on for the following year.

  5. Christian L. says:

    It sounds like you two will be just fine for you. That’s good to hear.

    As for me, I’m trying to put 4 percent of my income to a Roth IRA, but the the 2 percent increase on the payroll tax might affect that. So far so good, but it’s early!

    -Christian L. @ Smart Military Money

  6. My big goal last year was to move. It was designed to save transportation costs. That worked but not as well as I had hoped. Then we had budget cuts. I haven’t come up with my big money goal this year.

  7. My goal is to figure our where we are. Sounds simple but not so easy. Small corporations involved–will be nice to see what A, B, etc have. We really don’t have a handle on it now.

  8. Suzanne says:

    I am similar to you in that in the past I made tons of big goals and became frustrated if I didn’t achieve ALL of them. A few years back I decided to have “one big goal that supersedes all other goals.” In other words, if I could not achieve the first goal, then the next in line could not be accomplished. You would be amazed at how well that has worked for me. This year my big goal is to fully fund our emergency account and I’ve made significant progress already.

  9. I remember last year I made too many BIG goals. This year I opted to for major goal. What I’ve learned to accomplish my BIG goal is to set up checkpoints along the way. These checkpoints allow me to review what I’ve done or if I need to rethink my strategy. It prevents me from becoming too overwhelmed.

  10. My major goal is to have zero credit card debt by June 2013 and reduce my student loans by 10-15%. I am hoping to achieve this through more focus and effort towards multiple income streams.

  11. cubiclegeoff says:

    My only goal is to use as little savings as possible until my wife starts working again in September. That’s not really a concrete goal, but it’s the best I can do right now I think.

  12. Robert says:

    Try to fund 401(k), IRA and my son’s 529 plan to the maximum amounts allowed by the law.

  13. Steph says:

    I have two major goals this year. The first is to save up at least $5,000 for a wedding, which I already started, but I’ve had to dip into that fund to pay for other things as well. 🙁 The second big goal is to pay down one student loan and begin a snowball effect to pay down the rest. Step one towards that goal is to deffer my federal loans, which I’m already beginning.

  14. Scott says:

    Our major goal is to get our will and life insurance plan in working order. Just need to find the time…

  15. Shirley says:

    My financial goal for this year is to add another 10k to our emergency fund.

  16. admiral58 says:

    Saving up for a home down payment

  17. Julie says:

    My goal is to increase my retirement contribution this year by 25%!

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