2020 Recap – Did we get closer to reaching financial independence?

It’s December 30th, and we’re right at the end of 2020. What a year it turned out to be for the world, for our friends, and for our family.

Outside of focusing on financial independence, 2020 created some very unique experiences with our kids … they are young enough that their memory only has recall for a masked society. We’ve seen them talk about masks in self play, we’ve seen them promise that their friends don’t have the ‘sickness’ as part of their pursuasion to have friends over for play dates. It’s been a real challenge and stress for them, because they know we’re parents… and parents aren’t kids or “my size” as our oldest child put it.

Looking back though, I am happy I was able to spend so much time with my children. We typically would drop them off at school and then head to work — instead we balanced working from home with consistent interaction with our children, and developed a much closer bond because of it.

Alright, now that I’ve shared a couple words on that … let’s see how much closer we are to reaching financial indepedence because of 2020.

2020 Goals For Reaching Financial Independence

Goal 1: Contribute $10k To Emergency Fund — ACHIEVED

We successfully contributed to our emergency fund to add the $10, actually in this case multiple times as we drew from it. We now are entering 2021 with a large enough emergency fund to allow us to immediately begin contributing to investments.

Goal 2: Contribute $10k to IRAs — ACHIEVED

We successfully maxed a traditional IRA for both of us for 2020.

Goal 3: Contribute <= $15k to remodel master bathroom — ACHIEVED

We did complete the master bathroom remodel, and it actually ended up costing us $23,000 rather than our target of $15,000. This is now the third time we’ve done renovation work where things went over budget. From research, this is relatively typical and we’re learning to expect this and how to plan for it. Either way, even with the increase we were able to take advantage of credit card points for the remodel, amd then immediately pay off the debt with cash to avoid interest. We increased our home value, gained credit card points, and paid zero interest … win win.

Goal 4: Contribute $2k to 529 Plan — MISSED

Our contributions for the year are $1580, with a ending value of $1783.97. This goal is very important for us, as we want to surprise our kids with paid for college once they are accepted into a school of their choice. However, we were ok with missing this in order to achieve other goals, because we can contribute to these at any time to hit our target.

Goal 5: Contribute $13k to Spouse 401k Plan — ACHIEVED

Our goal was to take advantage of company match and contribute $13,000. In reality, contributes were just over $16,000 resulting in us achieving the goal.

Goal 6: Contribute $19,500 to 401k Plan — ACHIEVED

I received the email from my 401k provider this evening that I hit the allowed maximum contribution of $19,500 resulting in successful completion of this goal.

 

Final Thoughts

I am very grateful for the year we had financially, in a time when many others were far less fortunate. I am also grateful for my kids, my wife, and our families. I am grateful that we stayed healthy, happy, and loved. We are still working on our 2021 goals, but a sneak peak is that we are planning to sell our current house and move into a new one that is larger.

 

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