Part of getting my house in order is doing a review of my finances. I believe that you should always have a good idea of where you stand on money. I’ve done alright for myself over the years and consider it a blessing. Given that I will probably need to spend some of my hard earned cash on my new ventures, I want to make sure that I’m always on stable financial ground.
Currently, I have assets in traditional checking/savings accounts, a Roth IRA, an IRA rollover from an old 401k plan, a handful of mutual funds, and a small brokerage account with some fun money. I’m not a rich man, but I’ve invested when and where I can. I’ve always taken advantage of 401k matches and I’ve tried to keep my contributions high. In my twenties, my contributions were over 15%, but not as much in more recent years. I’d like to maintain 15% as a goal.
I do have a mortgage, a car payment, some credit card debt, and probably a home equity line coming in the near future. My student loans were paid off ten years ago. I can live with the mortgage payment, but I’d like to get rid of the credit card and auto loan. I’m well on the path to doing this, I just need to finish what I have started and get them taken care of.
Going through the dreamlining exercise this week was interesting. It made me really think about how much money I really need to make to have the life I’d like to have. I’d like to be financially golden by the time I am 60, but I’d also like to have a lot of fun between now and then. These two things do not have to be at odds with each other. If I stick with my 15% investment goal, keep life simple, and calculate my dreamline costs and make good choices, I should be able to make all this happen.
Enough about my personal finances. Now it is time to think about the income side of the equation.