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Friday, December 14, 2018

2018 End of Year Money Recap

Here we are, Bosses. There are only 2 weeks left in the year and what a year it has been. I will be taking a break for the rest of the year to spend time with friends and family. As my last post of the year, I wanted to help you recap your year. How was your 2018? Did it go by as fast for you as it did for me? I think it is important at this time of year to think about what was accomplished and what can be improved upon. I am going to take you through my yearend review process and help you understand how financial planning should be a part of your yearly reflection. Hopefully, it will allow 2019 to be your best money year yet!


Questions to ask yourself

1) How did 2018 feel?

Every year has a vibe to it. Some years feel like scrambled eggs. We get slapped upside the head with medium to large payments. We make a big life decision that costs a good amount of money. We take a hit in income that throws us for a loop. What was your impression of the year? Did you feel like you just couldn’t get ahead? Did the turmoil in the stock market make you weary? Did work push you further or set you back? In a couple sentences describe your financial year.

2) Are you ahead of the game, or behind?

What sticks out from this year? I think it is important to evaluate your financial standing on a monthly basis and certainly an annual basis. Have the debts piled up or are they reduced? Did you eliminate your debt or did you acquire new ones? Is January 2019 going to smack you upside the head because of the holiday spending, or were you ready for this holiday season?

3) What did you accomplish financially this year?

Some accomplishments can include setting up an emergency fund. Acquiring well-needed insurance. Eliminating costly debts. Opening an investment account. Having the discussion about retirement. Buying a home or paying off your existing home. Implementing a budget for the first time ever. Sending the kids off to school or if you are/were a student, paying off the student loan. Accomplishments can be as simple as finally kicking the daily Starbucks habit or as complex as setting up an estate plan.

4) What setbacks did you have this year?

We all have hurdles to our financial growth. Some are our fault, others get brought upon us. Where did you slip up this year? Did you accumulate new debts this year? Did you not get anywhere with your existing debts? Did employment affect your life somehow, ie. job loss, reduction in pay/hours.? Did the kids cost you an arm and a leg in some form or fashion? Even more important, what could you have done to prevent these miscues? While some circumstances are brought upon us, how we handle them is completely in our control. What can we have done to be better prepared?

Avoiding a January Debt Hangover – Budget Boss

Financial Advisor


Net Worth

It is important to track your net worth on an annual basis. If you have never done this before, now is a good time to get started.

Net Worth = Assets – Liabilities


Any assets you have that have a tangible value to them can be included in your net worth. This includes money in your bank account, the value of your investment accounts, equity built up in your home, and anything that has “non-depreciating value.” Things like your automobile, unless a vintage car, should not be included in your net worth. The reason why this is so is that when it comes to resale value, you can’t be certain what you will get for it. Also, the value you get for it fluctuates greatly on an annual basis, declining as time goes on.


These are your debts. Some common liabilities including loans, like student loans or auto loans, your mortgage balance, credit card or line of credit debt, and any money owed personally to family or friends. The goal should be to have this number decrease on an annual basis.

Your total net worth

When you take all your assets and minus all your liabilities you now have your net worth. Your goal throughout your working years is to have this number increase on an annual basis. When you are younger this number will often be a negative one. This is due to loans taken out to start our lives, ie. student loans, auto loans, and mortgages. Having net worth milestones is an important part of the financial goal setting process. It helps keep you on track for the goal of a comfortable retirement.

Why Knowing Your Net Worth Is Important – Investopedia


Your monthly budget

One of the areas where people neglect their finances is on the micro level, meaning the month to month spending. A solid financial standing always begins at the daily spending level. How did you find this year’s monthly budget? Were you always scrambling to come up with money for bills? Were you late on some payments, thus affecting your credit?  Did you fall behind and therefore created new debts? Did you use a system to keep track of spending, namely a dedicated written budget? Your net worth is the macro picture that helps you see if you are on track for larger goals like retirement. Your monthly budget is how you achieve those macro goals. It is important to understand how it all fits together and it literally all starts from your monthly checking account.

A Simple Way to Organize Your Money – Budget Boss

Financial Advisor

What would you like to happen in 2019?

There are 2 things that help us determine our goals in life. The first is pleasure, and the second is fear. I often find that fear is a greater influencer than pleasure. The pain of debt, missing deadlines, losing money to interest, missing out on an opportunity, and working hard for no real gain is a huge factor in helping us formulate financial goals. The pleasure of living comfortably, doing the things we want to do, traveling without financial fear, and accomplishing large goals is also a key factor. What do you want to accomplish in 2019? Is it fear-driven, or pleasure driven? Here are a few goals that might be part of your 2019 game plan:

  • Implementing a budget (fear)
  • Saving up an emergency fund (fear)
  • Opening an investment account (fear)
  • Securing affordable personal insurance coverage (fear)
  • Buying a home (pleasure)
  • Going on a vacation (pleasure)
  • Helping a loved one with education (pleasure)
  • Getting a raise and/or a promotion (pleasure)

Your goals for 2019 will be as unique as you are. If you struggle to think of goals, I suggest you consider this. What do you not like about your financial status? A noble goal is to work backward from a pained moment and find a solution to it.

Needing car repairs caused me to put it on my credit card.

I then had to take a few months to pay that back.

If I had savings, I would have avoided those interest costs.

I, therefore, need to accumulate some emergency savings to avoid this again.

I, therefore, need to institute a monthly budget to track spending and make sure I have a monthly surplus to put into savings.

Working backward is a great way to determine financial goals. The key is to recognize a problem and work back towards the solution. Another important key is to be honest about the root causes of the problem. Remember, while an issue that occurred may be out of your control, like your car breaking down, the solution is always in your control, like having emergency savings to pay for repairs.

The Top 10 Money Goals for 2019 – Budget Boss



Financial self-evaluation is extremely important. 50% of Canadians have no emergency savings. 70% do not have adequate insurance coverage. Over 50% are not on track for their retirement goals. These figures are troubling and not fun to think about, but they should also be an eye-opener. Every December should be a time of reflection of the year gone by and planning for the year ahead. If you have this mentality you can take your financial future by the horns. The key is negating those items that cause you financial harm and emphasizing your financial strengths. Let’s all try to make 2019 our best money year yet!


“The way we experience the world around us is a direct reflection of the world within us.” – Gabrielle Bernstein
Financial Advisor

50 Budget Hacks for 2019

Email – joe@budgetboss.ca 

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