Goals for 2013

For 2012, I was able to meet most of my financial goals, which encourages me to do better and aim higher in 2013. This is Year 2 in my journey to early financial independence, and achieving success this year will go a long ways towards helping me reach my final destination – freedom. After taking two weeks off from work to rest and relax, I’m fully recharged and ready to rock n roll!

Challenges Ahead

At first glance, I am expecting 2013 to be a more challenging year. For one, the novelty of saving intensely and investing in real estate + dividend stocks has started to wear off. This is to be expected, of course, so the real test will be to determine whether or not I can stay consistent for another year. That is, I have to stick to my convictions and avoid lifestyle inflation! I have to continue to ignore friends and co-workers when I see them waste money, and encourage me to do the same.

By no means have I lost interest in investing and saving, as I thoroughly enjoy seeing the passive income stream grow on a monthly basis. 😉 I’m just pointing out the obvious fact that Year 1 is almost always easier, with regards to almost anything you choose to do. The path to early financial independence is no different.

Lastly, I expect my workload at my job to pickup drastically in 2013. The honeymoon period is over, and I will be expected to contribute much more this year. As such, I’m anticipating working many long hours, and “selling my soul” to the company. This year will be the year of the grind, for sure.


1) Acquire Rental Property #2

I am currently under contract on a short-sale property, which I won back in late October. At the time, my winning bid was for $285,000 for a 2/2 condominium in a prime location. Since then, the local real estate market has continued surging, and the estimated value of the home is now around $320,000.

The lender is currently reviewing my file and a decision is pending. If the purchase price is deemed too low (the lender will do their own appraisal to determine fair market value), I may be forced to increase my offer, or risk a rejection. In addition, there’s no guarantee that I will even be able to obtain a second loan, since I just purchased my first rental property last year.

There are a lot of variables and unknowns at this time, so I’m not counting my chickens before they hatch. Worst case, my offer is rejected and I have to continue my search. After all is said and done, though, my goal is to acquire another rental property in 2013. Plain and simple.

2) Passive Income of $1000/month

The current rental property is generating around $400/month or so in profits (after all expenses). If I can acquire another rental property, I should be able to add an additional $400/month. So, if the rental properties can generate $800/month, this means I will need my dividend portfolio to average $200/month.

Readers who have been following might think that I’m aiming a little low on the dividend side of the passive income stream. After all, my projected dividend income for 2013 was already calculated to be around $2300/year. This gives me an average that’s just under $200/month.

The reason for the lower projection? If I do indeed acquire rental property #2, I will be forced to sell some stocks in my dividend portfolio to fund the downpayment. There’s no other way around it, since I don’t have enough funds in cash to complete the transaction. By doing so, I expect the total value of the dividend portfolio to be reduced by 30% or so. After the transaction is complete, I will need to use the remainder of the year to rebuild my dividend portfolio. I really do detest the idea of having to part ways with some of my holdings (I’m a big believer in buy and hold/monitor), but it’s hard to have the best of both worlds, sometimes.

3) Max out Roth IRA for 2012 = $5000

I still haven’t gotten around to funding my Roth IRA for 2012, but I’ll have until April to complete this task. Since this only requires $5000, I’m confident I will be able to meet this goal.

4) Max out 401k for 2013 = $17,500

I’m holding off contributing to my 401k until the short-sale status is finalized. Once this is all sorted out, I will do my best to catch-up and fund my 401k. In the perfect world, I’ll be able to meet the max again for 2013.

5) 80% Savings Rate Average for Each Month

I’m going to challenge myself this year and aim to save 80% of my net income. Last year, I averaged just under 70%, coming in at 68.96%. If I can cut some costs here and there, and continue building my passive income streams, I believe this goal should be reachable.


I expect 2013 to be a challenging but fulfilling year. Work stress is anticipated to be at an all time high, which is undesirable, but hopefully this will just add more motivation for me to succeed in reaching my financial goals.

If I stay the course, and all goes to plan, my passive income streams will be generating over $1000/month by the end of the year. This progress would provide a tremendous boost, as it would put me 2/3’s of the way there towards reaching my final goal of $1500/month.

This would make for some exciting times, indeed. After all, my forecast for reaching early financial independence has been pulled in from 37.5 to 33! So, let’s get to work and make 2013 a most successful year! 🙂


What are your goals for 2013? What are some of the challenges you expect to face?

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JC @ Passive-Income-Pursuit

That’s some pretty nice goals. I hope you can get that second property that is currently under review and without having to raise your price. That way you can start getting your cash flow going from there. It’s a shame that you’ll have to sell some of your DG stocks, but if the right opportunity comes along then it’s worth it. I’m still not a big fan of trying to max out the 401k since it’s much tougher to have access to it before 59.5, but if you feel that’s best for you then you need to do it. I’m… Read more »

Dividend Growth Investor

Actually, if your portfolio holdings are held in a margin account(s), you can withdraw money from it, and won’t have to sell your stocks. Of course you would be paying a high interest rate (something like 6% – 7%), and if your stocks decline too much you might be asked to add money to your portfolio by broker (margin call). But if you wanted to withdraw $15K form your 65K portfolio, that sounds doable. Also, the interest on the portfolio charged on your income portfolio can be offset against the dividend income you receive.

Jon @ MoneySmartGuides

Great list of goals! I wish you luck on saving 80% of your income. That is truly something to be proud of! One question about the short sale, if your offer gets rejected or you would have to up your bid and you decide not to, are you out any money? I’m not 100% clear on how the process works.

The First Million is the Hardest

Nice goals, I’ll be really impressed if you hit them all! Personally, I’ll be trying to save 50% and trying to build up my dividend and passive income streams. Although I don’t have a specific $ amount in mind as I’m still getting started on it all this year.

Dividend Mantra
7 years ago

FI Fighter,

Man, that’s some set of goals! I really hope you’re able to achieve all of them. That would be simply phenomenal. That 80% savings rate goal is especially impressive.

2013 is shaping up to be really great. Even if you only hit a 70% savings rate and fall short of your goal that still would be really awesome.

That rental property is working out spectacularly. A second one would only compound the results you’ve already achieved.

Best of luck with all that 2013 brings you.

Best wishes.

7 years ago

Sounds like we both have some pretty ambitious goals! Short sales are fun, but I hope it works out for you! When do you plan on maxing out your Roth IRA for 2013? You should do that this year as well 😉 80% saved of your net income is killer!! I can’t wait to see what you do this year!

7 years ago

Those are definitely some good goals. We have 2 rental properties at the moment, and are very glad that we bought them. Our goal is to continue paying on our debt! Good luck with yours!

Compounding Income
7 years ago

Wow man, those are some lofty goals! If you’re gonna aim, you might as well aim high.

“the novelty of saving intensely and investing in real estate + dividend stocks has started to wear off.” Hehe I know what you mean. The excitement of seeing a dividend hit the account is long gone… I probably log into my brokerage account once a week or so unless I plan to make a purchase. I try to check every so often incase of identity theft, it’s something I worry about. I will never use a no-name brokerage for that very reason.

Brick By Brick Investing | Marvin

FI Fighter

You’re absolutely killing it! I wish I had gotten into real estate while I was single. I marvel at your techniques and properties that you plan to acquire. Hopefully one day I will pull the trigger on investment real estate. I know it’s the quickest route to passive income!