2008 was a reasonably decent year from a net worth perspective, although Q4 was the first quarter in which my net worth actually went down (due to a reduction in the value of my primary home) since Q3 2002. Yikes.
My net worth as of 1/1/08 stands at $775,200, a 10% increase from January 1st last year. In nominal dollars, I saved/invested $64,000 this year and netted a $70,000 increase in net worth. Not great, but not terrible either.
My financial goals for the upcoming year are as follows:
1) Save 50% of my Net Spendable Income (NSI) - Targeted at $55,000
I define NSI as my gross income less taxes (Federal, State, SS, Medicare) and less charitable giving.
So, for example, if I have a gross income of $100,000, $25,000 in various taxes and $15,000 in chariable contributions, my NSI is $100,000 - $25,000 - $15,000 = $60,000 and thus my savings goal for the year is $30,000.
Due to an expected raise in early '08, a (relatively optimistic) expectation of a decent bonus and some sideline consulting work, I am tentatively setting my income goal at $200,000 for the year. I'm also assuming that I will contribute 15% of my gross income to charity, and that taxes will total 30% of my gross income.
Thus, in nominal dollars, my savings goal for the year equals $55,000 ($200,000 - $30,000 charity - $60,000 taxes = $110,000 / 2 = $55,000).
2) Contribute 15% of my gross income to charity - $30,000 target
Giving is a huge goal for me. My long-term goal is to reach a point at which I'm contributing 50% of my gross income. This will take some time, but I have consistently given at least 10% for the past 5 years and will work towards hitting a consistent 20% level over the next 5 years.
3) Achieve a net worth of $900,000
Starting at $775,000 with a $55,000 savings goal yields $830,000. To this, I'm planning on $70,000 of investment income (9% weighted average investment return).
And yes, I know I have close to zero control over this given my index-centric philosophy.
I'll put up my quarterly updates to track my progress through the year.