Financial Plan For 2016

I am not much of a planner. The universe probably has its own plan for most of us but it also doesn’t make sense to just leave everything up to chance. So, with that, here are a few things that I will aim for in 2016. Not a resolution since I like to roll with the punches and will adjust my plan as needed. (Fear of commitment? me? no!)

Debt

I stopped using credit cards a few months ago and it has made my life so much simpler. For several years I’ve only used it to collect miles but even that is too much of a headache and just leads to more spending. I’ve been using my debit card for all purchases — love it. I will have my student loans paid off before the end of this month (December). I’ll start the new calendar year debt free.

Real Estate

The condo, which I recently purchased, is ready for me to move into. Even though I was going to just let my lease run out (another 6 months), I decided to save myself nearly $4,000 by subletting the place.

It’s important to me that I don’t fall into the trap of renovating and upgrading which I feel is a big financial black hole when it comes to owning a primary residence. I will have ongoing expenses of HOA dues and property taxes which add up to ~$350/mo. I need to touch up a few things so for 2016 the goal is no more than $1,000 spent on the condo.

Job

I’ll continue full-time work for most of 2016. This year I will  break the $250k gross income point. Hopefully with itemized deductions and 401(k) contributions I can bring this below $250k otherwise I’ll be hit with AMT (taxes) and lose the ability to deduct my property taxes (I think).

My tentative retirement date is 5.2019. I would still need to work until then in order to vest in my pension program. However, I don’t see myself staying at this job for another 3 years and change. I could go down to as little as 50% and still vest so we shall see.

Expenses

Going back to YNAB for sure for 2015. I posted not too long ago that even though I thought I was spending no more than $2,000 per month the reality was closer to $3,000. It’s easy to forget about those little expenses and they add up quite nicely.

YNAB screenshot. These are the categories I am using.

I’ll be needing to cook more at home which means eating out less. My entertainment expenses are out of control now that I’m dating so there is a lot of room for savings there.  I go to a coffee shop about 2x a day on my off days. I will cut that back to 1x per day.

 

What plans do you have for 2016?
Are you working towards a retirement plan or is it something you’re not quite ready to tackle yet?