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December 2009

Although I’ve been tracking my finances publicly on Consumerism Commentary since 2003, this is only the fourth year I’ve outlined specific financial goals for the new year. The next year is a bit of a mystery for me. I feel like some changes are necessary, particularly in my day job. Although I have some big plans for the work I do outside my job, I have to consider the possibility that these plans simply won’t work out. I’ve been hedging my bets for a while, but I’m not sure that I can continue putting as much as I want into my projects, working 9 to 5 in a corporation, and maintaining my health and sanity.

So it will be interesting to see where I am able to go this year.

While I try to determine my immediate life plans, the least I could do is set some financial targets.


While my “Other Earned Income” increased from 2008 to 2009, there was a trend throughout the year of less of that income being generated through advertising. That is both good and bad; while it means I’ve diversified my income somewhat, advertising is generally the main source. It is possible that advertising has had a slow year in general, and will pick up with the economy, but I’m not counting on it.

My goal for 2010 is to maintain a a six-figure income outside of my day job. I think I will need to keep conservative expectations this year. This will be difficult enough considering the trend of declining income in the second half of 2009.


I’ve been considering increasing my non-retirement investing, currently $1,000 per month in the Vanguard Total Stock Market Index. I am not sure the numbers make sense, though. The stock market has spiked up recently and I prefer to increase investing following declines. I will continue investing in my retirement accounts but I’m going to consider ceasing my automated monthly non-retirement investment in VTSMX.

The limit for investing in a 401(k) in 2010 will be $16,500, reflecting no change from the 2009 maximum. I’ll continue investing a percentage of my income for retirement that would hit that mark after 52 weeks. I will also fund my 2008 IRAs this year.

If you’re considering investing, ShareBuilder is offering 10 free automatic investment trade credits if you start an investment plan in January. Normally, these automatic purchases of stocks through ShareBuilder cost $4 each, so you could save up to $40 on transaction fees. Keep in mind it will still cost $9.95 to sell your investment.

Non-financial resolutions

The most popular New Year’s resolution, even more popular than to get out of debt, is to lose weight. I have no choice but to be like everyone else; my primary non-financial resolution is to get in shape this year. I am not significantly overweight, but I need to increase my level of activity and eat healthier.

I don’t consider myself to be very organized, and living by myself, I have a tendency to let entropy take hold. I will resolve to keep my apartment in such a condition that I could quickly prepare for visitors rather than needing a weekend to make my living quarters presentable.

And finally, I plan to continue doing things that I enjoy and that enrich my life. One of my favorite hobbies right now is photography. I signed up for a second photography class starting in January, but unfortunately the course might be canceled due to low enrollment. I’ll keep finding interesting things to work the creative side of my brain — in addition to writing.

What are your goals and resolutions for 2010?


This article is presented by Kelly Whalen, Consumerism Commentary staff writer.

At midnight people around the world will be celebrating a new year with celebrations, parties, or a quiet evening at home. You may already have plans to party like it’s 2009, but if you don’t here are a few ways you can celebrate without breaking the bank.

Host a potluck with a twist
Having friends or family over is a great way to be social without having to spend a lot of dough. For adults have everyone BYOB. You will end up with a variety of choices for everyone to try, all you have to do is provide the party music, and the cups.

Throw a kid-friendly party
Instead of keeping the kids up until midnight (never a good idea unless they are teens), shout Happy New Year at the hour of your choosing, it’s a New Year somewhere! Best to combine this with plenty of snacks and crafts to keep the kids happy while parents chat.

Stay home with your sweetie
It may seem boring, but it’s good practice for your old age. A candlelight dinner (if you have kids, wait until they are in bed), a bottle of champagne, and watching the ball drop is a wonderful way to ring in the New Year.

Go out for drinks, but not dinner
Why not save your cash and dinner before you go out? You’ll save a ton since restaurants tend to have price fixed menus.

Be the designated driver
If you are going out, be the designated driver for your friends or family members. Everyone will be so appreciative they will buy you non-alcoholic drinks, you’ll wake up without a hangover, and you won’t spend a dime!

Have any other money saving ideas for New Year’s Eve? I’ll be staying at home with Mr. Whalen, enjoying a movie, and some champagne. However you choose to ring in the new year remember not to drink and drive.


At the beginning of the year, I set a few financial goals and resolutions representing what I would like to accomplish by the end of 2009. Like last year, my progress is mixed. I’ll get to that in a moment.

I’m not a big fan of the concept of financial goal setting. Goals or targets evoke the image of an endpoint, the touchdown. If you keep running through the end zone, you will hit a wall. The financial goals I set and share each year are markers or milestones. The collection of money, even a certain amount of money like one million dollars, is not a goal. The goal is the kind of person you want to be and how you use the money you accumulate.

Nevertheless, setting time-based financial targets is helpful to measure progress against expectations, even when some variables are beyond control. Here is how I did in 2009.

Goals for 2009

Income: My goal for “Other Earned Income” in 2009 is $108,000, or an average $9,000 per month. My stretch goal is to surpass this year’s success with $132,000.

Result: success. Other Earned Income is basically any income I receive other than the salary from my day job. Surprisingly, I surpassed my stretch goal. However, the year ended weaker than it started. Just maintaining my income throughout the year required more diversity in income sources and much more work than I expected.

Investing: Contribute the full $16,500 to my 401(k). Contribute the maximum to a Roth IRA if possible; if not, contribute to a Traditional IRA and convert the account to a Roth IRA in 2010. Contribute the maximum to an SEP IRA. Invest $250 per month into an account to help pay for future children’s education.

Result: mostly a success so far. I did contribute the maximum to my 401(k) this year, a feat I would not have been able to accomplish (without a major lifestyle change) if I were working with my day job salary alone. I did contribute the maximum to my 2008 Roth IRA and SEP IRA earlier this year, and I plan to do the same before my 2009 taxes are due in April.

Now that my business has been reclassified, I may have more flexibility in how I determine how much I can contribute to the SEP IRA, so I won’t be able to determine the amounts until I work with my accountant.

In addition to retirement investing, I invested $1,000 in the total stock market index fund at Vanguard in a regular non-retirement account at the beginning of each month since May.

I did not, however, set aside $250 each month for my future children’s education. I am still undecided about how — and whether — to tackle this before having children.

Saving: After I pay my taxes, I’d like to take half of whatever I have left and earmark that amount for a down payment on a house.

Result: qualified success. The amount I have in savings accounts, including business accounts, has increased this year from $80,000 to $120,000. I consider that a success. I haven’t specifically earmarked half of that for a house. My “House Fund” at ING Direct holds about $14,000 while I’ve allowed my business savings account to accumulate.

One of the reasons I haven’t invested most of this is because, as I’ve been saying for a few years, I want to have the funds available for when I decide to purchase a house and need a down payment. I’m still not keen on the idea of settling down.

Overall result: mild success. I don’t set net worth targets any more due to the volatility of the stock market. I should end the year with a modified net worth of around $300,000. I have to extend great thanks to the stock market for recovering this year from lows at the end of 2008.

Although I earned more money this year than I earned in 2008, I also spent more money. Overall, my “savings,” what I have left of my income after expenses, decreased by about $20,000. If we take taxes out of the picture, the situation changes. I paid close to $50,000 in taxes this year, including a significant 2008 tax bill, compared to $20,000 in 2008.

Thankfully, I’m working with an accountant now who has already saved me $15,000 between 2007 and 2008.

Tomorrow, I will use some of these results to determine my financial targets for 2010. Did you meet your goals this year?


If I were to tell you that I think I drink too much liquor, you’d likely conjure up some images of alcoholics you’ve seen, maybe picturing some guy falling down, abusing the people he loves, making terrible decisions and driving like an idiot. So I want to be clear right from the start that I am not a drunk, nor has anyone accused me of even coming close. I sympathize with those who suffer from real alcoholism, and I hope they all get help.

The truth of the matter is that while I don’t have an addictive personality, I do have A.D.D., and I’d been self-medicating without knowing it for the first thirty years of my life. Sometimes with sugar, sometimes with caffeine, and sometimes with liquor. But since I got diagnosed, I’ve been watching my behavior much more closely, and acting self-aware more often. I usually know just how much caffeine to take, and when to take it.

However, I think I’ve been overdoing it on the wine lately. Every so often some receptionist will ask me to fill out a form that asks, among other things, how much alcohol I drink. And I find that the answer I give – 1 glass a day on average – is becoming less true. It’s almost always at least two. More worryingly, some days I’ll come home and pour a glass as soon as the chores are done, which is before 5 PM. There have even been days when I want a drink before I even think about taking the garbage out.

Red wineI’m what you might call a quiet drunk, at least when I do it properly. Mostly, I just feel a lot less nervous and a lot more comfortable, as if I don’t have A.D.D. So, I’m not looking forward to losing that comfort, but I recognize that it’s artificial, and I don’t really want that for myself.

Why am I writing about this here? Well, because I’m the one who takes the garbage out, I see how many bottles of wine we go through. It is, not to put too fine a point on it, plenty of bottles. Let’s say there are ten glasses’ worth in each bottle (that’s a 1.5 liter bottle, you know, the big one), and my wife and I both have two glasses a day, and three each on Saturday and Sunday. This is a conservative estimate. That’s one bottle for the work week and just over half of another for the weekend.

In a month, that’s 68 glasses, or almost 7 bottles. Assuming we buy the cheap stuff every time, that’s about $70 a month. (Coincidentally, that’s the same amount we’re saving by switching off the cable TV.) Granted, sometimes I will want a glass of wine, and I’m not about to try banning it from the house. I’m not a prude, and I don’t seek frugality at the cost of comfort. But for myself, I’m going to try drinking less.

I’ll still have wine sometimes, but not every day as a matter of course. Like a visit to Starbucks, I think I’ll treat it like a reward for doing something I wanted to get done. And in 2010, I expect to get a lot of things done.

Photo credit delphaber.


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