Friday, October 05, 2007

2007 Financial Goals…

I know how important it is to set realistic goals or as Single Ma would put it, "S.M.A.R.T." goals. Check out her post here on annual goals.

S.M.A.R.T. stands for:

S - specific

M - measurable

A - achievable

R - realistic

T - time based

I realized today that I didn't set any 2007 goals. When the year began, I knew it would be a tough one with me finishing school, preparing for the bar and looking for a job. I felt like and still feel like my life is in limbo and that things can change any minute for the better. I could get a new job next week that could keep my income the same, double my income or even triple my income. It's just a matter of opportunity.

In the back of my mind, I think that I knew I wanted to reach $30,000 in my 401k by the end of the year, establish a $15,000 emergency fund (3 months of expenses) and that I wanted to be below -$90k for my net worth.

I am on course to be below -$90k thanks to my parent's graduation gift, with $28.5k in my 401k but only 2 paychecks remaining for the year, I will come really close to the $30k goal but I will need some help from the market. As for my emergency fund, I fell short. I will only have $12k. Some might think that my emergency fund goal is too high but when you add in my upcoming $1,650/per month student loan payments into the mix, my monthly committed expenses grow by leaps and bounds. While I know during times of unemployment, I can probably put my loans into forbearance, I also know that it takes a little processing time and I want to be prepared for a hostile lender situation if need be.


Anonymous said...

hey. congrats on passing the bar. i'm working at a law firm in chicago but i'm supposed to take the bar in february. filling out the application for the bar exam is a pain!

it seems like you have a checking account and a savings account (like most people). i would suggest taking a look at fidelity's my smart cash product (if you haven't already). the checking portion (fdic insured) has a 3.45% interest rate and you can purchase money market funds (at least a couple of which have greater-than-5% yields). the good features are free draft protection (so that you keep the my smart cash account balance at $0 and then any deductions result in a sale of the necessary amounts from your money market fund), unlimited atm rebates, check-writing, 1.5% cashback credit card and good customer service. for now, if you transfer more than $10K into fidelity, you get $100 and 15K united or american miles (quite a few people have successfully double-dipped). the only bad thing is that the money market funds are not fdic-insured. for me, that risk is not large because not too many money market funds have seen their NAV go below $1.

if your credit history is okay, you may also want to consider doing a balance transfer for life for better interest rates on a chunk of your student loans.

Anonymous said...

First off, I'm from Phoenix "Go DiamondBacks (sorry about the Cubs)Now onto your post...I have been teaching people how to supercharge their retirement account and create that emergency fund very quickly!!! visit my website at: and my blog at
it can really help you,
Steve Herman

Chitown said...

zzzhr...thank you for the information. I am going to check it out today.

Good Luck with the February bar!

Chitown said...

Thanks Steve! I will check it out!

LOL at your Cubs comment. =)