I mentioned here that I'd found a list of 20 financial milestones to reach in your 20s. Well, I'm in my 20s, and it's not too late to take a gander at this list. The list comes from Gen Y Wealth, a GREAT personal finance blog for people like me.
I've pasted the list of 20 milestones below, with my comments about where we are and where we're going. All in all, I think we're in pretty good shape. Once I get some retirement funding set up, we'll be in great shape.
1. Finance a dream vacation in cash. Doing. We've been married three years now, and we've only really had one vacation - our honeymoon (8 months after we got married). We didn't take on any debt for that trip, but a lot of it was made possible by our parents (frequent flyer miles, timeshare, a wedding gift of cash specifically for the honeymoon). This summer we're going to Israel with a group of young adults from the church. Part (ok, nearly half) of the trip will be funded by the church since Brian's a pastor, which is the only way we'd be able to save enough in the 10 months from plan to execution (THANK YOU, CHURCH!!). We are so excited.
2. Pay off your student loans. Doing. I was fortunate enough to make it through college without taking on any student loans, thanks to my mom and grandparents. Brian made it through grad school without any loans (amazing) , but we're still being visited by the undergrad loan fairies monthly. We make steady payments on these and are on track to paying them off early, but there's still a ways to go. It'd be pretty awesome if we could get these taken care of in the next 2 years, but that isn't going to happen unless I start bringing in some cash money (which is admittedly the goal).
3. Automate paying your credit card bill in full. Done, but done MY way. Everyone says that automating your finances is a good thing, and it probably is. But I've found that I much prefer having my finger in every pie, so to speak. I like writing the checks. I like tallying and pushing buttons to make the money go here and there. I like reviewing every credit card statement before paying it off (in full every month). I get why automating is pretty sweet, but I have deliberately chosen not to automate at this point. We do pay off our credit cards in full every month, and I have about a billion email reminders set up to make sure I don't miss anything.
4. Get rid of all bad debt. Done. A lot of finance people say any debt is bad debt. I get that. And I don't like being in debt. But I'm ok with two kinds of debt - home mortgages (which we don't have) and student loans for a finished degree (which we do have). We lived on credit cards for a few months in the first year of marriage, because we simply had no money and all of our savings was gone (not to mention my ability to sleep at night...2008, the year of depression and anxiety). But I found a better job (better pay, not necessarily environment) and wiped the credit card debt within a couple of months. Because that stuff sucks the life energy from you.
5. Build an adequate emergency fund. Done. I haven't really decided what an adequate emergency fund is for us, but whatever it is, we've got it.
6. Make your first, and last, investment mistake. Done? I think we've made ok investment choices, but the biggest mistake we've made is not doing more, sooner, especially retirement investing. BIG mistake. After having negative dollars for a while, I kind of needed to see commas in our regular checking and savings accounts. BUT, this is the year to get past that and start setting up some things for the future. More on that in a minute.
7. Develop a statement of cash flows. Doing. I haven't done this before now. I kept the checkbooks balanced and made sure there wasn't more outgo than income. But as far as anything on paper, haven't done it. Until now! I spent an hour or so on New Years Day putting together some new spreadsheets for our new budget. (Is it weird that I get a rush from that stuff?)
8. & 9. Max out a Roth and Contribute to your 401(k). About to do. So....we don't have any retirement accounts set up yet. Being nonprofit/church workers for the vast majority of our working lives, we've never had 401(k)s. I did have a shot once at a 403(b) but we couldn't eek out the minimum monthly contribution, so it stayed empty (no employer contributions before a year of employment, and I left before reaching the year marker). I think Brian has a retirement account of some sort through the denomination now, but I haven't figured out what exactly is going on there. But it's on the to-do list for this month, as is opening a retirement account for me! I've started researching and expect there will be a new Roth IRA in my name in the next ...oh...8 weeks? By April I should have a good idea of what kind of contributions we'll be able to make, and then I'll get those automated. Or at least I'll get Brian's automated. Or something like that.
10. Get a degree or certification that increases your earning power. Done? Brian took care of this with his masters degree. Me, I'm not sure how to approach it. I took some coursework, though not a full certification, to increase my earning power, when I was working. Getting a certification doing the kind of office work I do is overkill. As a freelance editor, I've read that certification isn't going to help me out a whole lot since I already have the right degree. But if I do go back to admin work, I think there's plenty of room for certification.
11. Take a career risk. Done! I worked a hellish soul-sucking job right when the market crashed and hundreds of thousands of people in Richmond lost their jobs. In the middle of the bedlam, I got an offer for a 2-month temp job paying a lot more than what I was making, doing work that was a lot more enjoyable, with people I'd worked with before and knew I liked (and who wouldn't stand outside my door talking in raised voices about how some people had better step up their game because there were lots of people looking for work). I decided to go for it. And it worked out to my great benefit. My new boss connected me with a friend who needed someone to do what I do, which led to probably the best job I've ever had. I was really sad to leave that job when we moved out here, but I'm crossing my fingers that my days with the organization aren't over.
12. Negotiate something. Done. I don't think I've negotiated anything of import (though marriage has been one long negotiation, it seems). I do negotiate every Craigslist deal I've done, though. Brian is a terrific negotiator when he sets his mind to it. He talked himself out of a contract with one cell phone company 9 months early and then talked himself into a contract with a new company to include no startup fees and a reduced price on a cell phone. I'm still dazzled by that, and it happened a year ago.
13. Earn your first side grand. Doing. I'm not there yet, but I'm on my way! Brian's about halfway there, too, I think. Though he's not really trying.
14. Start a sub-savings account for an upcoming financial goal. Done, basically. Our banks don't do this, and the ones that do offer a lower interest rate, so I keep the numbers on a spreadsheet instead. I'd rather earn higher interest and still have the numbers handy. If you're really into line-item savings, ING Direct gets rave reviews.
15. Set a target retirement date. Um... not there yet. I can get my head around retirement savings, but retirement itself is kind of an enigma. I guess I would have had to have a steady career for retirement to be a factor. Brian says he doesn't want to retire...we'll see what he says when he's 65. I think that's kind of a minister thing, though...not retiring.
16. Monitor your credit. Done. For three years now. Did you know I have credit accounts dating back to 1978? This is of particular interest to me, given the fact that I was born in 1983.
17. Say no to a financial salesman. Done. Step off, life insurance salesman guy. We've got bigger priorities right now.
18. Give just enough to make it hurt. Done, and doing. We made a lot more money last year than we have ever before. We also gave away a lot. Some days I really would have liked to skip the giving, just for a month or two. But we never did. And that hurt. Looking at our donation balances and comparing them to our student loan balances hurts. Those debts could be more than halfway paid down by the amount we gave last year. But ultimately, giving is more important to us. I'm really glad we stuck with it.
These next two are for the Over Achiever, which I apparently am not.
19. Invest $1 for every $1 you spend. Right now this is simply not feasible. I'm ok with that, though. Unless you define 'spending' as leisure/recreational spending, and not total spending. If that's the case, we probably could do this. If we chose to, anyway.
20. Start a 529 College Savings Plan. I get how flexible and cool these things are, even for folks without kids, but I think it's more important for us to get our loans paid off and our retirement beefed up before looking at things like this.
So tell me, what do you make of this list? Like it? Hate it? Wish you never saw it?