I was reading Luxe Strategist’s post the other day (my new favourite personal finance blog discovery because with this one post, it is clear that she and I are so much alike it is eerie), and she wrote about how she would crush her 2017 goals.
I guess I never thought about it.
What are my goals this year now that I am working?
1. Add +$100,000 to my net worth by the end of the year
Very possible to do. It just means staying under $3000 spent a month until the end of the year and hoping the markets don’t tank.
I also would breathe much easier if I got extended for all of next year as well and then my net worth is really set.
…which brings me to..
2. Get extended for all of next year
Mama needs another year of working to solidify her income and net worth. C’mon, extension!!
I also LOVE. LOVE. this client. <3
3. Rein in my spending. No rules though.
EVERY TIME I SAY SOMETHING about spending, I end up getting screwed either by myself or by family influences or stupid, too-good-to-ignore sales.
Honestly, I just want to …. rein in spending. It is hard when you’re tired, you’re bored, and you want to do something and the only thing your brain can handle, is window shopping online.
No for real.
I have no mental capacity to comprehend a book, listen to a video in French, nothing. Nada.
Nothing is in there.
Only shopping appears. LOL
4. Give some thought to my retirement plan
I don’t know about this.
Everyone keeps asking:
When do I want to retire and how?
If I say I need $1,000,000 net worth (just myself) to retire, I have to consider the following and work backwards in my math.
$1,000,000 saved minus $300,000 for the house leaves me $700,000 in cash or equivalents.
If I took very low paying dividends at 2% a year (stable but low), we are eking out a $14,000 yearly dividend income.
No way am I living on that. I know myself.
I need at least $30,000 as a base income of dividends to live on, after taxes.
So let’s say I need $45,000 in dividends to be sure.
$45,000 / 2% = $2.25 million saved.
Fine. Let’s go with $2.25 million, and if that’s the plan, that means I have about $200,000 saved in cash or cash equivalents, and I have about $2,000,000 left to save.
If I can keep working full years, that means I need 10 more FULL WORKING YEARS to go.
Then this happens in my head:
A) Will I even be able to work for 10 years full-time on a contract?!?
I normally only get 3-month contracts at a time, and some times, go up to a year or two without working. That eats away at my money. That, and shopping and eating it.
B) Will I seriously be able to work without a break?
Breathe, Sherry, breathe.
OK, so let’s say it takes me double that time to work, give or take spending etc…
That means I can expect to retire in about 20 years. I’ll be a little over 50 years old.
Wouldn’t be so bad, would it? And that’s considering a dividend income at 2% a year giving me $45,000 a year.
Now let’s look at the budget on a dividend income
Let’s say I get $36,000 a year after taxes are said and done.
That is doable.
- $1000 = Condo fees and taxes
- $1000 = Living expenses
- $1000 = Vacation, shopping, Baby Bun, Other
So .. I guess the plan is:
10 Years of Full-Time Working
$2.25 million saved.
*rolls up sleeves*.. 2 million to go.
Unless I scale back and need LESS in dividend income..?