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BHAG UPDATE

1/11/2013

2 Comments

 
So about a month ago or so I defined my BHAG (BIG HAIRY AUDACIOUS GOAL) of retiring in 7 years and in order to do that I needed to save somewhere in the realm of 72% of my income, assuming I start with nothing.  Give or take 10% depending upon future investment returns.  There's a lot of unknowns over the next 7 years.  

How have I been doing?  For the month of October I was at a saving rate of 26.5% of my income. About 45.5% short of my goal!  I'm very disappointed in myself (sad face).  I attribute this to 2 things, first being that I had to pay early for my vacation this winter, which consisted of over 66% of everything I spent last month.  Secondly, I had to pay for my homeowner's insurance premium (18%), which should effectively smooth out as the year goes on since it's an annual contract.  

Another big expense would be the purchase of a new home, which carries a lot of additional expenses.  I've found a way to mitigate this with roommates.  A contract was signed this week for one and I'm working on the second.  If I can find a second, this should help mitigate two-thirds of the costs as one would expect with 3 people living there. Pretty low cost of living even for me.  

It'll be interesting to see how this increases or decreases over the next 2 months and then going into the winter.  I've been keeping track of the income and expenses on my iSpending app, which has proven to be incredibly easy to use and customizable.  It's like $3, but well worth the money!  

I never thought I'd be so disappointed to save over a quarter of my income, but that's the way it is.  That's the whole point of setting up a BHAG.  Now that a big expense is out of the way, I'll have to see how the rest of the year goes.  If my future spending habits go the way they did this past month (minus the big purchase), then I should be back on track for the 70% range.    
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2 Comments
Mortgage Investors Corp link
15/11/2013 08:54:46 pm

In these times, it is essential that you have a good way to manage finances

Reply
MortgageInvestors.com link
18/11/2013 03:48:26 am

Surely you can find an option to solve these financial problems

Reply



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    This website was created due to the atrociously misguided financial advice that I've heard over the decades.  Financial freedom is not intellectually strenuous, but it takes discipline. 

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