Monday, April 14, 2008

My Financial Goals

As you have probably noticed I have some financial goals listed to the right in bar graph form. I thought i should explain what these goals are and why i have chosen these.

Emergency Fund

The first goal is an emergency fund. Due to a recent layoff (temporary) I have come to realize the importance of having an emergency fund. I have set a goal of $5,000, as this should provide for about 3 months of expenses should i ever lose my job. I hope to achieve this goal over the next 2-3 yrs. You can check out an earlier post about why you should set up and emergency fund.

Dividend Income

I have set a goal of $40,000 of dividend income. This is the amount of income i would like to be collecting from dividends when i retire. As you can see it is currently at $0, as i have been investing inside of an RRSP until just recently. I am changing my strategy to invest outside of an RRSP in companies that grow their dividend year after year. I hope to retire in about 20-25 yrs if all goes well.

Down Payment

The third goal is to have $10,000 for a down payment on a home. I am currently renting and want to get out of that rut so i am building my own net worth and not someone else's. I am well on my way to this goal and have about 75% saved thus far. I am trying to decide what to do with my tax refund and I may put it toward my down payment. We will see. I hope to achieve this goal in the next 6 months.

Bike Loan

I have a bike loan for a motorcycle I bought a couple of years ago. At this time i have no plans to pay off the loan early, as i want to concentrate on some of the other goals. For now i will be paying the monthly amount until the loan expires. As you can see i have about $8,000 left in the loan and it will be paid off in May 2011.

Net Worth

The final goal is a net worth of $1,000,000. I pretty much just pulled this number out of the sky. It is not nearly important to me as the dividend income of $40,000/yr. However, I would still like to achieve this goal even though it will take quite a long time. I obviously have a long way to go on this one but hope to achieve it by the time i retire. You can learn how to calculate your net worth here.

These are my current financial goals. Hopefully they will inspire you to set your own!

What are your finacial goals?

4 comments:

Dividend Growth Investor said...

Dividend Dollar,

I was wondering what companies you are looking into buying for your dividend growth strategy?

Good luck in your financial endeavours!

Dividend Growth Investor

MG said...

Sounds like you are well on your way! Good luck!

Dividend Dollar said...

DGI,

There are lots of companies I am looking at buying. I'll give a quick list of 10 here.

Royal Bank
Bank of Nova Scotia
Manulife
Power Financial
CN Rail
Walmart
McDonalds
J&J
Encana
Home Depot

Dividend Dollar

Dividend Tree said...

DD,

You made a start and good one with some goal in mind. That's a big step. Be positive and enjoy the process. As a beginner, only one suggestion, have patience.

Good luck
DT