Saturday, February 9, 2013

Defining Your Goal

There are two major inspirations for why I am working on this new project of mine.  Although neither have said "Thou shalt start a dividend portfolio."  Both in different ways have pushed me to thinking differently about life and finances.  I typically feel ahead of the curve on the finances side, even if my wife seems to think I spend more than necessary on the items she does not feel are worth the value.  On the life side of things it really depends on the day of the week you ask.  Just like, I assume, most in their late twenties feel I'm still learning how everything works in life.

My first source of inspiration is actually a blog written by Trent Hamm, called "The Simple Dollar".  I've been reading this blog for a few years now.  To be honest I have not read every single post.  That is the beauty of this blog however.  It is packed full of great advice and is written with a take it or leave it mentality.  I mean I don't think I would ever rewash Ziploc bags for lunch, but now I know it saves me ~$1.50 an hour if I wanted to.  I didn't necessarily use that advice, but one big thing that is re-occurring on the blog is to set goals and build a path to accomplish those goals.

My second source of inspiration is my boss at work.  He does all the normal things a boss does, but goes beyond and truly is a mentor for personally.  One thing he told me when I first started working for him almost 2 years ago was that my job and career at our company would not define me as a person.  Being in my mid twenties and single I thought he was crazy.  Of course my career defines who I am... right?

Both have pushed me in different directions, but lead back to this project.  How can I use finances to ensure a sound and happy life?  How do I create the opportunities to have a successful life?  My answer is a rough outline or path to my goals.  My path is to create a passive stream of income that I can build up now to rely on in the future.  I plan to create a dividend portfolio by utilizing excess income over my spending to build a steady dividend stream when I need extra money in the future.

Well that's pretty simple... at least I hope.  The harder part is how do you define goals.  Not that defining goals is difficult, I do this every day at work when I'm given a new report or a request comes in.  Those are very short term and clearly defined.  A dividend portfolio really takes time (10 years or more) to truly build and create.  Long term goals like this really escape people early in their career since it just started ~5 years ago.

I've decided to leave my goals a bit vague, but with keeping the idea of ensuring happiness in my life there are two things that I am certain are going to make me happy.  Those two things are to see my kids be successful and to spend a long low stress life with my wife.  So to try and ensure those both happen my goals are...

  • By time my first child is in college; generate dividend income to fully offset college expenses with the hope that if all kids go to college I can supplement at least 1/3 of college with this portfolio.
  • After college for my kids is complete; generate dividend income to allow us to own a country home outside the city and still afford to visit our kids wherever they may live regularly. 

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