Financial Plan

  • I will design a financial plan one time every year. This plan is my blueprint going forward as I build a financially successful life. I need this plan to guide me and hold me accountable for the decisions I make throughout the years.

  • I will complete my net worth statement and place the results on my plan. This helps me to identify where I currently am financially. I will review these results with last year’s numbers to verify that I am on the right path.
  • I will review my investments and make sure my asset allocation is still appropriate based on last year’s assessment. I will rebalance my investments as needed. I know that my asset allocation and costs incurred with those investments will make the biggest difference in how they turn out (up or down) from year to year.

  • I will review ALL of my insurance policies. This will involve making sure my policies are providing me value for the money I am paying. I will make sure the deductibles are high which will lower my yearly premiums. I will focus on dealing with catastrophes, not minor inconveniences. The money I need for deductibles will come out of my emergency fund as needed.

  • I will set my short-term goals. These goals will be very specific and I will periodically check them during the year. I need these goals to provide me a path to follow. I will meet these goals!

  • I will set long-term goals. These goals help me in making my short-term goals (backward planning). I know my financial future will be bright if I have a plan with goals that will get me there. I will not wing it. I will take control of my financial life. I am the answer!


My Current Status

  • My assets equal $28,450

  • My Liabilities equal $10,230 (student loans)

  • My Net Worth is $18,220

  • My current asset allocation is 80% stocks and 20% bonds/cash (no change needed)

Insurance Needs

  • I don’t need life insurance at this time

  • I have full coverage on the truck with the highest deductible ($1,000)

  • I don’t need rental property insurance at this time (I don’t have much to steal)

  • The job covers my health insurance with no deductible

Financial Goals (this year)

  • Put 100% of my 401K contributions in the Vanguard 2050 Target Retirement Fund

  • Change my 401K contributions to 20% of my gross pay.

  • Read 2 of the personal finance books on the list stated below

  • Monitor my expenses very carefully. NOW is the time to sacrifice.

  • Keep my tracking document updated and focus on what is really important to me. Live below my means today so one day I can live well above my means!

  • Empty my savings except for $1,000. Put everything else towards the school loans.

  • Starting on 1 February start paying down $1,000 on my student debt loans per month. Select the smallest loan and pay that off first. Proceed to the next smallest and pay that off. Continue this process until all of the loans are paid off.

  • Take my tax refund check and put it all towards my student loans.

  • Stay out of debt! I promise myself the only debt I will have going forward will be mortgage debt and MAYBE a business loan. I will AVOID all other debt!

  • I will go back and fill up my emergency account. Once I have $3,000 I will move it to move it to the Total Bond Market Index Fund at Vanguard. I will identify my monthly living expenses and load up this account to equal what it takes for me to live for 6 months.

  • Once the emergency fund is full once again I will start my Roth IRA (the home fund). I will go to Vanguard and open up the Target Retirement 2030 Fund (VTXVX) with an initial $1,000. I will set up an automatic investment into this fund of $400 per month. I will have the money automatically taken out of my bank account and just keep feeding this fund in good times and bad. I will ignore the day to day ups and downs of the stock and bond markets.

  • I will start looking at homes when the account reaches $10,000. I will identify how much I can afford and then figure out what 20% of that amount would be. Once I have built up that 20% in my Roth IRA I will be ready to buy. I will try hard to finance for 15 years.

  • I will stay flexible. When children come along, I will check on my free life insurance at work if there is any, my survivor benefits at Social Security and then and only then will I look at getting some inexpensive term insurance at I will continue to educate myself from independent authors who have no conflict of interest with the information they are providing me.

Financial Goals (into the future)

  • Buy a home around the year 2030

  • Max out my 401K and my Roth IRA each and every year

  • Buy a better car (3 years old) in 2028 with cash that I saved up in my emergency account

  • Find a wife who has a similar perspective on money as I do.

  • Retire at 50!!!!!!

  • Read all of the financial books stated below at least one time before I reach 30

This plan provides me a predictable, secure and financially free future. Will there be bumps along the way? Sure there will. I want to live the life of my dreams. As I age this will become clearer in my mind. I will sacrifice today for a greater tomorrow. The rewards are worth it! I will update this financial plan at the same time next year.

Recommended Books

  • Now What? by Mike Finley

  • Financial Happine$$ by Mike Finley

  • What Color is the Sky by Mike Finley

  • Graduation! by Mike Finley

  • Let’s Get Real About Money by Eric Tyson

  • The Millionaire Next Door by Thomas Stanley

  • Your Money or Your Life by Vicki Robin and Joe Dominguez

  • The Investor’s Manifesto by William Bernstein