Last updated: Nov 10, 2024
The three main goals I set in 2022:
- Be fully and efficiently invested
- Earn as much from investments as my business earns in a year
- Earn around 8% return on investment
I’ve slightly revised them for 2023:
- Being fully and efficiently invested
- To make relatively low-risk, consistent returns
- To keep pace with inflation
Revised them again in 2024:
- Be 100% fully invested
- Beat inflation
- Invest in real estate or other assets besides stocks
- Reduce trading frequency
And in 2025, they are:
- Beat inflation with my returns
- Track the S&P 500 return (not lag behind it too far)
- Lean towards capital preservation and away from pure risk or speculation
- Increase tax effectiveness
Although my original goals were lofty, I didn’t need them to be lofty. And I was unwilling to accept the variance that investing in risky assets required.
Goals need to be measurable. So, how can I measure the above goals?
- Be fully and efficiently invested – keep cash on hand below 10%
- To Make Relatively Low-Risk Consistent Returns – 33% invested in bonds/money markets (not including cash)
- To Keep Pace with Inflation – predicted annual return as a percentage of around 6%
| Stated Goal | Goal Percentage | Deadline | Current Percentage | Date Achieved |
|---|---|---|---|---|
| Cash-on-hand | Less than 10% | Jan 1, 2024 | 15% | Dec 2, 2024 |
| Low-risk returns | Around 33% | Jul 1, 2023 | 12.4% | Jun 23, 2023 |
| Rate of return | Around 6% | Jan 1, 2024 | 6.06% | Dec 1, 2023 |
| Total rate of return | Around 8% | Dec 31, 2022 | 9.13% | May 1, 2024 |
At some point, I will have to switch from the predicted annual return to a run rate or actual return, but I just stepped back into the market and don’t have that data yet. I’m using the 5-year average annual return for the investments for now.
I’ve also decided to aim for a particular investment mix. My desired investment mix will be:
- Index Funds – 40%
- International – 15%
- Individual Stocks – 5%
- High Div ETFs – 20%
- Bond ETFs – 10%
- Cash/Money Markets – 10%
My current investment mix is as follows:
- US Index Funds – 41.8%
- International Exposure – 18.7%
- Individual Stocks – 2.3%
- High Div ETFs – 12.3%
- Bond ETFs/Preferred Shares – 15.6%
- Cash/Money Markets – 9.4%
Note that my definition of cash includes short-term investments like money market funds or short-term bond funds. At some point, I need to resolve the difference between uninvested cash and invested cash.