2013 Financial Resolutions

Just like last year, I would like to share my financial resolutions for the new year. Here's what I hope to accomplish financially in 2013:

• Keep investing in real estate. I need to move the two places we have from "start-up" mode to "on-going" mode. This means getting them fixed up and rented. As for new places, I'd like to do two more transactions this year and at that point, I'll probably be set for a bit. Since I now have a good start on my portfolio, I can be even pickier regarding what I buy.


• Develop extra income streams. I have a couple of money making ideas related to FMF that I would like to implement as well as a couple other ideas in the works. I'd like to get at least one of them to the point where it brings in an extra few thousand dollars in 2013.


• Re-work our estate plan. It's been a few years since our estate plan was done so I think it's time to review.


• Complete a "death file". I have been working on a document that lists where all our assets are, online passwords, credit card and insurance info, etc. for my wife in case something should happen to me. This is the year I'm resolving to complete the job!!!


• Consider a landscape investment. We have several trees that may or may not be dead in our back "woods" (not true woods where you can let trees die and go on your way, but really a clump of trees in a neighborhood.) We're not sure about their condition because of the thaw/bloom/freeze cycle we had last spring. They could be dead or just stunted a bit by the weather. So we need to evaluate and if they are dead, we will need some landscaping upgrades.


• Take a family trip. We want to go on another cruise/warm weather vacation as well as plan another trip similar to the DC vacation we took this year. Our kids are getting older and will only be in the house a few more years, so we want to do as much with them as possible while we're all together.


• Review retirement plan. As my real estate investments become more stable (earning income and not in "fix-up" stage), I will adjust my retirement calculations to make them more accurate.


• Review other investments. I need to do a complete evaluation of my stock/bond holdings to be sure they are where I want them to be, accomplishing my objectives, etc.


• Get free financial advice. Both Chase and Vanguard have offered me the opportunity for a free financial overview. I'm wary that they will simply turn into a sales pitch, but their thoughts may be worth something, so it could be worth the risk -- especially if they have "special opportunities" for accredited investors.


• Keep up the networking. My career-focused objectives for 2013 are centered on networking. I want to keep up and expand my in-person network as well as (finally) get set up on LinkedIn and do some online networking. As they say, there's never a better time to set up a strong network than when you don't need it.

There may be a few other goals that come in over the course of the year, but I think these are the highlights.

How about you? What are your key financial resolutions for 2013?

Comments

[Joan]

I like this post, especially the "death file" one. I am bound and determined to get all my passwords and recurring payments noted. Why? My husband does not know any of the passwords for banking or utility sites I pay the bills thru. So just in case something happens to me, he will have a reference. Linkedin is another one I need to keep up on.

[Cherleen @ My Personal Finance Journey]

I am always looking for various sources of extra income. Hence, I started with two new blogs on travel and food. My daughter and I will also start with our new business of hair accessories. I am positive that they will bring us extra money for this year onward.

[Steve]

I've always invested very aggressively (justifying it on being young and no debt including a paid off house). I'm no longer as young, the losses from the last crash are more than recovered and the portfolio is getting quite large.

So it seems like its time I should be including bonds at this time that everyone is saying there is a bond bubble. I need to start figuring this out.

[retireby40]

You should go for the free financial overview. You don't have to buy if it turn into a sales pitch. Rentals can be a pain in the beginning so don't get your hope up too high. Good luck in 2013.

[My Money Design]

Good call on the death file. I've got one of those. It's not fun to put together, but I know it will make things a whole lot easier in case the worst ever happens.

[Kramo]

Geez, FMF, why have you become so obsessed with real estate all the sudden? Is it because your index funds are letting you down? Still don't think real estate is very cheap anywhere...ask Old Limey!

[FMF]

Kramo --

Just how am I obsessed with real estate? I mentioned it in one bullet point -- just like I did with my other investments.

As for why I'm interested in real estate, I made that pretty clear here:

http://www.freemoneyfinance.com/2012/08/my-road-to-becoming-a-landlord.html

As for the financials, they are pretty good, as detailed here:

http://www.freemoneyfinance.com/2012/12/we-bought-our-first-property.html

There's no way for you to be able to make a blanket statement like "Still don't think real estate is very cheap anywhere" with any sense of accuracy unless you know real estate in every single market in the US, and even then you need to know every single deal out there -- which no one does.

As for my index funds, they are on autopilot -- paycheck to bank to Vanguard -- so there's not much I need to do with them. Which is, by the way, a GREAT benefit of index funds. They are very low maintenance.

[jnwcmr]

FMF,

I have a "death file" which I update annually. However, I call it a "Letter of Instruction," but it serves the same purpose. I also have some suggestions for how to handle online passwords.

If you'd like, I'll share the table of contents and other details with you. Send me an email if you're interested.

[Rich@Money Wise Pastor]

FMF,

My wife and I just had a 4-5 hour long budget meeting yesterday to work on some financial goals for 2013.

It was frustrating. And fun. We got mad at each other. We laughed at each other...and at ourselves. We sat with blank stares at times, unsure where to cut and what to budget in some spending areas. And we arrived at some great decisions - together.

Somehow it was even a little romantic (budgets are sexy, so I've heard).

It was the best time we have ever had talking about our finances.

Here are some of our top financial goals for 2013:

1. Meet together twice a month (on my paydays) to review our spending plan and track our progress.

2. Save for a Florida vacation and Caribbean cruise "extra expenses" for our family (my in-laws are paying for the cruise itself) in January 2014.

3. Accelerate pay-off of a Lending Club loan for a new furnace at our rental house in September 2011.

4. Review our home, life, and auto insurance coverage and compare rates.

[Mike Collins]

The 'death file' is something that has been on my list for awhile too. I kind of have it in bits and pieces but need to put it altogether and store it safely. thanks for the reminder!

[Old Limey]

One of the secrets of many wealthy married couples is that they have the same attitude regarding Spending versus Saving. I have been fortunate that my wife and I came from almost identical backgrounds and that we have always been on the same page with our financial decision making.

It reminds me of our current government where one party favors a small government that does as little spending as possible and encourages personal responsibity, and the other party favors a large government that takes over many of the responsibilities that should belong to and be shouldered by the individual.

In regard to the current discussion going on in the news about funding the $60 Billion it has been estimated that it will take to rebuild the devastated areas in NY and NJ it's easy for me to separate an individuals's responsibility from that of the Federal government. It would seem to me that since I don't have earthquake insurance and live in California that if my home was demolished by an earthquake I shouldn't expect the federal government to make me whole again. Likewise I don't have flood insurance either. I do however carry a large automobile insurance policy and a large homeowner's policy but both policies are very clear about what they cover and what they do not cover. In the NY and NJ situation, FEMA (the Federal Emergency Management Agency) has already been and gone and fulfilled their obligations.

It is partly for these reasons that my wife and I have always placed a very high priority on "Saving" and "Investing" for a rainy day and now have more than enough financial resources to replace every piece of all the physical property that we own should it become necessary. However I'm in the minority.

[kitty]

@Kramo "Still don't think real estate is very cheap anywhere.."

If one can buy real estate with about 20% down 30-year fixed, rent it and have a positive cash flow, then it is NOT overpriced by definition. When real estate is overpriced, renting is cheaper than owning. If owning is cheaper than renting than the market is underpriced. Also - you cannot predict the exact top or exact bottom, but in many areas real estate started to turn. If you wait for the bottom, you'll wait forever. And really, do you know of many risk-free investments these days? You can lose money on stocks, and the CDs and bonds aren't even keeping with the inflation. Plus, the interest rates are still low. If you get a nice rate, then you'll be a winner as soon as we get inflation and higher interest rates.

Personally, I am seriously considering buying a condo and renting it. I plan to start looking next week.

I rented a condo out in the past and it was a great deal. My father (whom I took to live with me after my mother's death) is renting out his co-op. Saying how "rental can be a pain in the beginning" is another one of the generic statements. It can be a pain or it can be a cash cow.

[My Financial Independence Journey]

I'm very interested in your real estate adventures.

I'm considering real estate myself, but at present it seems like a pain. Some of my big concerns beign:

1) Super high down payments (where I live at least). I would rather be funneling that money into my investment accounts.

2) Finding a property manager who can actually do a good job. I could probably manage the property myself, but I'm useless at DIY stuff and don't really want to get into eviction spats.

3) Would REITs be a better investment?

I've got a lot of research left to do before I make a commitment one way or another.

[DPF]

I'm looking forward to you sharing more about your real estate investments this year. As for the other items on the list, I think the "death file" is a great thing for everyone to have. Not fun at all to think about, but necessary.

Linkedin is great - it's helped me out, just by having a profile out there, recruiters contact you. It's been very beneficial to me. Great for networking too of course.

[Ron Moon]

Don't expect a lot from the Vanguard financial review. I had one 3Q last year and while it was a sound 40 minute discussion - about how long it took to prepare the material on my end - they did not want to discuss my "non-Vanguard" non-financial assets. These matter. Given that, I doubt they will consider your rental business, and without that they can't do a full review. So they will probably give the sound pablum you'd expect from Vanguard and not much else. But it was a friendly discussion with a knowledgeable fellow. Good luck!

[Jane Savers @ The Money Puzzle]

I had never thought about a death file. My sons know where my will and important papers are but they will have an easier time if all passwords are available.

I am trying to learn about marketing to develop my own side business. If I follow the blog development strategies I have been reading about it will take several hours each day. I could be too tired for my day job.

[Stacey]

The death file or "letter of instruction" is on my list also. I'm interested in the table of contents that jnwcmr offered. Since I can't figure out how to email him, maybe that is something you can share on FMF or modify it enough to not attribute to jnwcmr. I'm also interested on a post on your allocation with your indexes and how you may have modified them over the years, number of indexes, etc. There are many "gone fishing"-like allocations...curious what you've learned in creating your auto-pilot plan and if you do it yourself or use Vanguard or another planner.

[Rajeev Kumar (@Mirketa)]

Very comprehensive mix. I never thought about the 'death file'. It makes sense to get it done to avoid trouble for others later on. I am not sold on 'free advice'. Would love to hear more once you had an opp. to talk to them. Good luck.

[FMF]

Stacey --

Stay tuned. I have an investing post coming up in a few weeks where I give a bit more info on my investments.

[Jenny]

I'm completing a death file as part of my goals this year too but I'm calling mine a Legacy Binder. A little less scary :)

[FMF]

Jenny --

That is a much better name! :)

[Timothy Mobley]

LinkedIn is a great resource. It has proved very useful for networking. A "death file" is something I need to work on as well.

[Leslie]

I've never heard it termed "death file" before. I have had one for a few years. I created it because I was traveling a lot and wanted things to be "easy" for my family. As things have changed a bit, a refresher is in order; thanks for the reminder. I would like to see more income from my two online initiatives and need to work towards that in 2013.

[Kim@Eyesonthedollar]

I have resolved to update our will in the next month, and I need to update the "death" file. I did one a couple of years ago, but I'm sure it needs to be changed.