Every January I open an excel spreadsheet and make estimations as to how I think the year will play out financially for the Ninja household. Although the year isn’t quite over, it’s time to check in and see how we’re doing. Here is a screenshot of our goals for 2011…

In the past, I’ve set the bar low and made my/our goals too easy. One year I reached them by July. It’s embarrassing to set low standards, so I made sure to really step up our game in 2011. You’ll notice in the chart above, we had a goal to increase our net worth by $3,000 a month, for a total gain of $36,000.

I knew we could reach said goal if we buckled down and made wise decisions throughout the year. We went through some significant life changes: like a 1,200 mile move and Girl Ninja looking for work, but overall we have had a really incredible year and pretty much punched our goals in the face. Here’s where we stand…

I guess you can look at our results two ways…

1. We kicked serious booty and were able to blow our “savings” goal out of the water and increase our liquidity by $40,000 in a single year. We also surpassed our $96,000 net worth goal by an additional $15,000.
2. We are epic failures because we were wrong on two of the five categories. Which means we are 60% awesome, and 40% fail. Sad.

Although I didn’t set my standards high for the markets this year, they still managed to do worse than I predicted. I only needed a $700 gain in my Roth IRA (after my $5,000 2011 contribution) to meet my goal. Sadly, I haven’t gotten it yet. It’s the same sad story with my TSP . I’m holding out hope though, we still have six weeks before the end of the year and I’m praying for a last-minute rally. I need a 3% rally to hit ALL of our goals. Think it will happen?

I was hesitant to write this post because I don’t want to come across as arrogant or bragging. I hope you know I’m an open book. I blog about the good, the bad, and the ugly in the Ninja household. We were fortunate to have a pretty stellar year, and we try our best to be responsible with what we’ve been given. Sometimes that means having fun and going on a random vacation to San Francisco, other times it means buckling down and contributing to our retirement, and sometimes it means giving a bunch of money away. Twenty-eleven was great to us, and we plan to do everything we can to make sure 2012 is equally awesome.

How has 2011 treated you (the good and the bad)? What were some of your financial (or personal) goals this year? Which ones have you met? Which ones did you fail?

Girl Ninja and I have a plan to punch 2011 in the face as hard as we can. On January first of each year, I like to open up my annual budgeting spreadsheet and see what the Excel gods tell me. After some serious number crunching, and some even more serious random number guessing, we have something to work towards, and that my friends is a net worth of $96,000. Here’s the breakdown…

2010 was the year of the non-budget budget as I didn’t have a clue how to prepare for dual income. I knew our income could vary greatly depending on how many days Girl Ninja was able to substitute teach. Last year was crazy, and this year things are no different.

We are almost sure to face some significant financial changes over the next year. That’s right, we’re pregnant…no not with babies (sorry mom)…but with job opportunities. And as you can expect, with a change in job, a change in salary often follows. There are really three potential outcomes for us.

1) We stay in San Diego. This would be the easiest situation to budget for as it would mean nothing really changed for us.

2) We move to Seattle. We are both originally from Washington and would love to be near our parents and our friends from high school. If we moved up north I would likely either A) transfer in my current position to the Seattle office (same pay) or B) I would look for something more lucrative in the Seattle area. We would likely meet, or exceed, our $96,000 goal if we moved up north.

3) Move wherever the heck the government tells us. You remember that “dream job” I’ve blogged about over the last two years. The one I applied for in February 2009? Well, I was called over Xmas break and told to expect to start March 28th. That is, if I re-pass the physical fitness test and accept the final offer. In the long run, this position would pay quite a bit more than my current position can, but it would DEFINITELY mean a short term pay cut (for about two years). One of the requirements of this position is a willingness to relocate at the needs of the agency. Since we don’t know how much my starting salary will be (should know in about 45 days) and we won’t know where we will be living (until after we’ve accepted the offer), I pretty much have no clue what this would mean for our net worth. The $96,000 goal would probably decrease to like $80,000 (after my pay cut and the time it would take for Girl Ninja to find a teaching job).

It’s crazy to think Girl Ninja and I will be determining the next five years of our life over the next five weeks. Heck, it’s probably pointless to make any goals since when we have no clue where we will be living or working. I guess it’s better than not thinking things through though…right? As always, I’ll be updating you all as Girl Ninja and I face some pretty significant life decisions, and I will definitely be blogging about our financial journey throughout this process.

What’s the most significant decision you and your significant other have had to make? How much of a pay cut would you stomach for your dream job? Do you set annual financial goals for yourself?

Seeing that 2011 is rapidly approaching, it’s time to see how the last 12 months treated the Ninja household. If you’re too lazy to read through, I’ll just tell you. Spoiler Alert: It kicked major butt!!!! Here were my original goals…

I love looking at that thing. It’s funny how much can change in one year. According to that chart I should still have about $12K owed to Sallie Mae. Praise baby Jesus, that’s not the case! Here’s a look at where we currently stand.

Checking: $9,374

Savings: $13,616

Roth IRA: $21,087

TSP (401K): $19,765

Sallie Mae: $0

Total: $61,000

As you can see, things turned out quite a bit better for us than originally anticipated. This is either the result of setting the bar too low, or having a freakin’ fantastic (emergency free) year. I like to think it’s a little bit of both. Since I like to be as transparent as possible, here’s a little more about the income we made in 2010…

Blog Income: $4,592

Gift Income: $4,429 (yes I’ll admit some of this was gifts from Mom Ninja, but most was wedding gifts)

Interest Income: $170

Net Income: $46,400

Tutoring Income: $2,552

In the words of Jay-Z, “I’m a hustler baby, and I just want you to know.” Haha, my two side hustles (tutoring/blogging) brought home a cool $7,144. I’m hoping next year to up that to about $10,000. Who knows if I’ll actually make it, but it’s worth a shot.

How ’bout ending with some random statistics you probably care nothing about, sound good?

Total Spent on Groceries: $2,095

Total Spent Dining Out: $1,431

Blog Operating Cost: $190 (which means a 2,316% return on investment)

Rent Paid: $13,532

Twenty-ten was pretty darn good to me and Girl Ninja. I would be totally stoked if 2011 turns out to be an even better year (those goals to follow in a future post). Here’s to hoping! How did 2010 treat you? Do you set goals each year? Do you “hustle” (if so, how much did it bring you)?

Got this letter from a fellow PDITF reader….

My husband and I own a condo in the SF Bay Area. We bought a 1bd condo at what (we thought) was the bottom of the market (sad face). We’re currently under water on the place about $30-$40K. We recently started snowballing our debt and the only remaining debt is about $3k of student loans due to be paid off in the next 2 months or so. Here’s our dilemma: after building 6 mo. of expenses in savings, should we:

1) start paying off the condo? Keeping with our current snowball amount ($3k) we could have the joint paid off in 2016! Problem is, we also plan on having children in the next few years and the maximum time we’ll live here is about 4 more years (although we’re open to using as a rental property), but we will likely stay in the area.

OR

2) start saving the 3k/investing the 3k? We are embarrassingly naive about investing in general and have no stocks/bonds/MM accounts other than our 401K…

We just don’t want to pour money into a house when we know it’s not our long term home, but we also want to make a savvy financial decision.

Advice from you/your readers would be hugely appreciated! Many, many thanks!

Courtney

The first thing that stood out to me about Courtney’s letter was this: “We are embarrassingly naive about investing in general and have no stocks/bonds/MM accounts other than our 401K”. Girl, it’s time to get educated and start investing. You need to have, at minimum, a basic understanding of the different investment vehicles available to you. That way YOU can decide if you’d rather invest or pay down the mortgage. You can’t make a decision until you know what all your options are.

I’m a fan of Vanguard mutual funds. Some love bonds. Others invest in individual stocks. I’d recommend scowering some PF blogs that really dive in to the ‘meat and potatoes’ of investing, so you and your hubby can choose the plan that’s best for you.

How much should you be investing? The general rule is at least 10% of your gross income, but probably some where closer to 15% if possible. I don’t know how much of your gross income is going in to your 401k plans, but if you’re investing less than 10%, I’d say your first plan of action (once your free of the student loan) should be to up your retirement contributions.

Unfortunately, I can’t really tell you what you should do with your discretionary income (save or pay down mortgage), because I have no clue what the real estate market in S.F. will look like in four years. If you think the markets are going up, up, up…it makes sense to pay down the mortgage a bit and let your equity appreciate. If you think the market is going down, down, down…it’s probably better to put your cash in the bank so it doesn’t lose value.

It doesn’t really sound like you are too sure what your life is going to look like 2-5 years from now. You may have a kid (you might not), your condo might go up in value (it might not), you might rent out your place (you might not). Until you really have a solid idea when you’ll be moving and when you’ll be having kids, I’d recommend putting your discretionary income in the bank. Cash gives you flexibility. If at any point down the road you decide you’d rather pay down your mortgage, you can always pull cash from your savings to do so.

I’m just one man though, and I’m definitely no real estate (or investing) expert. Let’s see what other PDITF readers would recommend doing in your situation. How bout it y’all, what do you think Courtney should do? Pay down the mortgage or build up cash savings?

Ask and you shall receive. That’s our new motto anways. Two years ago Girl Ninja and I had to do one of the hardest things we’ve ever done; Ask our friends/family for money. We volunteer for a high school ministry here in San Diego called Young Life. Most of the kids we’ve gotten to know over the last few years, come from low income (I’m talking like REALLY poor) families. Every winter, we try and take a group of kids to camp in Utah for a five day snowboard/ski trip. Can you believe the majority of these kids have never seen snow!

Most of the kids that come to Young Life want to go on the trip, the only problem is they can’t afford it. Throughout the year we’ll host fund raising events like car washes, selling raffle tickets, auctions, etc hoping to raise enough funds to reduce the cost of camp to a more reasonable level, like $100.

Two years ago, after some pretty unsuccessful fund raising campaigns, us leaders decided to reach out to family and friends and try and raise a little more. Here’s how a typical phone conversation went…

Me: Hey mom.

Mom: Hey Ninja, my most favorite child of all time, what’s going on?

Me: Well I’m calling to see if you think you and Dad Ninja could sponsor a kid to Young Life camp.

Mom: We would love to sponsor a kid.

Me: Thanks

Mom: No problem son. Dad Ninja and I think you are the most wonderful son in the world. We are honored to be called your parents.

Asking my parents for money was easy. It’s my parents, I knew that I could pretty much guilt them in to supporting me. It was having to reach out to my friends that freaked me out a little bit. How was I suppose to ask my friends to donate money to kids they’ve never even met? Thankfully, I have some pretty awesome friends, and just about every one of them was able to provide at least some financial support to our area.

Girl Ninja and I learned a lot that day and are glad we went through the experience of asking people for money (although we hope we don’t have to do it again anytime soon). We now know what it’s like, and we feel better prepared to help those that ask us for help.

It’s for this reason, we’ve decided to ALWAYS give money to friends and family when asked for charitable contributions. We know it isn’t easy for them to ask us, so the least we could do is help them out.

- Friend raising money for a breast cancer walk? Give ‘em money.

- Friend’s kid selling candy bars to raise money for a school trip? We’ll buy a box.

- Friend trying to provide clean water to people in another country? Count us in!

Don’t get me wrong. I’m not saying we’ll donate to every solicitation we receive (especially any annoying mailers). But what we will do is SUPPORT those that are close to us. We see this “rule” as a friendly (pun intended) reminder to be generous with the income we’ve been given.

Have you ever been asked (by a friend or family member) to donate/sponsor/give to an organization or charity? Did you do it? Do you buy lemonade from the local neighborhood kids that set up their stands in the summer? What giving/donating guidelines do you operate by?