# What should be my next goal? (long post)



## spp_24 (Apr 13, 2009)

I'm looking for advice on next financial goals to have in my life. I recently got some good news at work that I will be promoted and that due to the completed reorganization my job should be safe for the next few years. 

I'm married in Calgary with a major oil and gas company. I'm 35 , my wife stays at home and is 40, our kids are 4 and 2 years old. Our home (average Calgary home) is paid off completely. My current salary is $155,000/yr. We are reasonably frugal so after all of our expenses & savings contributions we usually have $1,500-$2,000 left over each month. My new job entails a good raise (around 10%) plus increased yearly bonus. Last few years was 30% of salary, now will likely be 40%.

ASSETS

TFSA 10,000
House 425,000
Work Group RRSP 60,000
Work employee share plan 17,000
Work share bonus plan - max $70,000, min $0
RSP his 120,000 (ETFs in couch potato strategy)
RSP hers 90,000 (ETFs in couch potato strategy)
Vehicle 1 25,000
Vehicle 2 4,000 

TOTAL ASSETS $740,000 - $840,000

LIABILITIES
manulife one acount -$3,000 (remaining from summer landscaping costs of $15,000)

*Net Worth *$737,000 - $837,000

Other assets
RESPs - $21,000
RDSPs - $3,000 (both children have cystic fibrosis a genetic disease affecting their lungs, health is currently good but who knows in future)

I currently max my employer GRRSP plan (14% of salary), the employee stock contribution plan (600/month), TFSA contributions (400/month each) and contribute $600/month to my wifes RRSP. As well I max out the RESPs ($400/month) and RDSPs ($300/month).

Long term goals for my wife and I would be to provide for our children and take early retirement (55-60) living a modest lifestyle in a warmer climate (or be snowbirds)

*A few questions:*
Am I missing any fundamental financial planning components? (i.e. are the savings and contributions above adequate to retire at 55-60?

Based on my income and free cash what would be likely next financial steps?

Thanks to bonuses and stock options we are considering vacation properties or taking on major pruchases such as major home reno, RV or sports car.


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## Rickson9 (Apr 9, 2009)

I think hitting $1M in net worth excluding your primary residence would be a nice goal.


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## Spidey (May 11, 2009)

Rickson9 said:


> I think hitting $1M in net worth excluding your primary residence would be a nice goal.



I agree. For someone in your position, that would be a good target.

If I can just throw in a little bit of preachy advice as well, I wouldn't simply limit goals to financial ones but would make some health goals, relationship goals, family goals and some fun goals such as places you may like to visit or things you would like to do. I've always found that all this stuff is more interconnected than we realize and taking care of one area tends to support the others.


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## OhGreatGuru (May 24, 2009)

You are certainly in good shape, and as long as you don't develop any bad spending habits you should be set financially. I agree it's time to think about those "what do we want out of life?" questions. The only reservations I have about your current portfolio is those various company stock options. Holding money in your employer's stock is having too many eggs in one basket. Ask all those former Nortel employees how smart that was. Flip the shares as soon as the rules will allow so that you can diversify into something else.


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## MoneyGal (Apr 24, 2009)

You ask whether you are missing any fundamental financial planning components: what jumps out at me from your summary is whether you've protected your human capital value. 

Do you have life and disability insurance to replace (some? all?) of your income stream should you be unable to mine your human capital?

As for whether you have "enough" to retire at 55 or any other age: it depends on many factors, from your health, to your expected withdrawals, longevity, inflation, expected returns from your investments, your product allocation, your bequest motive, and more. I wouldn't structure a retirement income plan now, at your age 35.


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## steve41 (Apr 18, 2009)

Hey.... if you have a reasonable job, expect to live like a pauper for the next 10 years and are fortunate enough to discover how to extract 20% out of the market,... you might become a millionaire.

On the other hand, if you steer away from scammy, leveraged real estate schemes, and look to a participate in a more realistic 5-6% investment market... you will be much more likely to arrive at that $1M, although it will take a bit more time and patience.

I'd opt for the latter.


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## ssimps (Dec 8, 2009)

Spidey said:


> If I can just throw in a little bit of preachy advice as well, I wouldn't simply limit goals to financial ones but would make some health goals, relationship goals, family goals and some fun goals such as places you may like to visit or things you would like to do. I've always found that all this stuff is more interconnected than we realize and taking care of one area tends to support the others.


Great advise Spidey. Not always easy to do unfortunately.

Regarding the original question, if you have a good job and are making good $ from it, I'd go for lower risk investments and let your income build your wealth and your investments maintain it over time.

BTW, buying expensive cars, RV ,etc will generally decrease your $ wealth, not increase it, but I'm sure you know that.  But maybe for you that is part of how to get what Spidey is suggesting.


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## spp_24 (Apr 13, 2009)

Thanks for the advice folks

Every year my wife and I set a few goals for the upcoming year. Always there are 1 or 2 financial ones (paying off mortgage etc.). Plus we set a few fitness goals like completing bike tours, entering running races etc. And we always have some family related ones like visiting family, potty training etc. So financial goals are just part of the picture.

I do have life and disability insurance, some through work and some held directly with RBC.

I was looking to ensure I haven't missed anything before starting an investment account outside of RRSPs, RESP, TFSA. I am a passive investor so I will have finish reading "The Intelligent Investor" and get up to speed. Maybe in a few years when I have more capital built up I will look at recreational real estate. 

Having a goal of 1 million net worth outside my home is a good goal though - thanks for that one/


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## Berubeland (Sep 6, 2009)

Laugh more - Cry less
Smile more - Frown less
Listen more - Talk less
Tell your family you love them at least once a day
Show your family you love them at least once a day
Read the book by the Dalai Lama - The Art of Happiness

Be a better person.


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## dogcom (May 23, 2009)

One good fun way to increase risk but use very little money in doing so is investigating the next big thing or subscribe to a small cap news letter finding small companies making money with a good future you can buy into.

You can easily lose most of this money if you buy to high or you get caught up in some sort of promotion so you must be aware of this and not get to caught up into this. 

If you feel like health care, rare earth or some sort alternative energy will be the future then find some very small or small companies to buy into. You would only invest a very small amount of money like 1 percent of your overall investments in them and if they work out the pay off can be very large.

As someone suggested above keep most of your money in low risk investments and pay more attention to increasing your contributions as well as enjoying life.


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